Whether your income during tech school is coming from a job or coming from financial aid, it’s natural to feel financially squeezed at this time in your life.
Although your funds may be limited, there are simple steps that you can take to minimize your financial stress and ensure that you start your career on firm financial footing. The most important of these steps is to set and follow a monthly budget.
Budgeting serves two key purposes. First, it ensures that you have a plan for meeting all of your financial obligations. More importantly, however, it gives you an opportunity to consciously think through your spending and ensure that your spending is in line with your values.
Step 1: Calculate your average monthly income
Look at all sources of income: financial aid (if you receive funds to help with living expenses), your full-time or part-time job, side income from pet-sitting, etc.
As you add up your income, make sure to only include post-tax earnings. If your full-time job pays a salary of $24k/year, you are NOT bringing home $2000/month! Check your pay stubs to determine your take-home pay.
Knowing your income is the starting point for creating a useful budget. You have to spend less than you earn; you can’t do that if you don’t know your true earnings!
Step 2: List all of your expenses for a typical month
Your current spending is a good starting point for setting a budget. List all of your expenses, breaking them down into categories that seem logical to you. You can do this on paper, but an Excel spreadsheet or an online calculator will make it easier to see your totals (and visualize the impact of changes, which we’ll discuss in Step 4).
Start out with the most obvious items, which are your monthly bills. These bills may include: rent/mortgage, electricity, water/sewer, cable/internet, trash collection, cell phone, health insurance, car insurance, car payment, etc. For the most part, these bills remain relatively consistent from month to month.
Next, create categories to encompass your other monthly spending. Look through your bank statements or credit card statements from the last couple of months to gain a true understanding of your spending (or keep a paper spending log for a few weeks), then divide these expenses up into descriptive categories. For example, my own personal budget includes categories like: gas, groceries, eating out, “fun money,” pet food/meds, human prescription meds, miscellaneous shopping, etc.
Step 3: Take a quick glance at each category and look for surprises
Before you begin to compare your spending and income, look over how much you typically spend in each category. Are there any surprises? Maybe your eating out category is much larger than you realized, or you’re spending far more on pet care than you expected.
If you find that your spending in a particular category is especially shocking, or runs contrary to your values, this would be an optimal category to target for spending cuts.
Step 4: Make adjustments to balance your income and spending
Look at your monthly spending to see how it compares with your monthly income.
If you’re spending far less than you earn, great! Congratulations! Hopefully, you are saving or investing that extra money in an emergency fund, retirement account, or a savings account for future goals!
If you’re spending more than you earn, however, you’re in good company. Fortunately (or unfortunately!), there are only two ways to fix this. You can spend less, earn more, or employ some combination of the two.
Review each category in your budget, paying special attention to anything that surprised you in Step 3. Are there categories that you can easily reduce? For example, if you’re currently spending $200/month on fast food lunches, packing your lunch every day may be an easy way to decrease your monthly spending.
If you don’t have any large expenses in your budget, you may need to be more creative. Shaving even $10/month off each budget category can make a big difference in your overall monthly spending. Can you be more efficient with your water and electricity usage? Carpool or combine errands to reduce your gas spending? Forego Netflix? Eat less meat to decrease grocery expenses? Think carefully about your daily habits and routines, looking for opportunities to shave off a couple of dollars off your spending here and there. Although it sounds silly, these little changes can add up and maybe be enough to balance your budget.
If you can’t decrease your spending any further (or you don’t want to), you will need to increase your income. Although increasing your earnings may require a bit more creativity than limiting your spending, it can have powerful results.
First, if you are working, are you maximizing your earnings at your current job? If you have gone several years without a raise, talk to your employer to determine if there are steps you can take to increase your value to the clinic and increase your pay. Even if you cannot get a raise, you may be able to sign up for additional shifts or minimize how often you end up leaving early on slow days.
You can also seek out a different job, with higher pay. Apply for other jobs, interview with other employers, and determine whether a job change will increase your take-home pay. Take into account factors like benefits, commuting costs, and other expenses to determine whether a job change could result in a net increase to your income.
Finally, look for creative ways to earn additional income. Many vet techs pet-sit in their free time; this can be a lucrative and flexible way to boost your monthly cash flow. Other options might include scooping pet waste from people’s yards (it sounds gross, but I’ve heard it pays well!), offering pet photography services, carpooling with a classmate in exchange for them giving you gas money, or other unconventional side jobs. Depending on how large the gap is between your income and spending, you may even be able to bridge the gap by selling unused items from around your home.
Step 5: Follow your plan
Once you’ve created a budget that allows you to balance your spending and income, focus on sticking to that plan as closely as possible. You may encounter setbacks along the way (okay, realistically, you will encounter setbacks along the way…), but reviewing and revising your budget on a regular basis will help you minimize debt during vet tech school and ensure that you start your career with as little financial stress as possible!