Illustrated by Jihyang Lim

Hack Month: How To Save Money When You’re Broke AF

Don’t be a bummer, baby

by Hafeezah Nazim

Welcome to Hack Month, a series of helpful tips and videos on how to make your lives easier throughout the month! This August, we're bringing you editor- and expert-approved tips on how to improve all areas of your daily lives, including beauty, fashion, money, and more.

While there's always a lot of buzz around anything we, millennials, do—like killing J. Crew, changing the beauty industry, or obsessing over houseplants—the most chatter seems to surround how we handle our money, which usually can be found far away from a savings account. But saving as a young person is rarely very easy, especially if you live in a large, expensive city, like millennials love to do.

Beyond just being hard to do, saving money feels hard to do, because few of us have the tools or education to know how to do it properly. However, saving money is necessary in order to be a functioning adult. So we enlisted the help of an expert, Broke Millennial author Erin Lowry, to give you the low-down on saving up for your future.

Read the interview below to find out how you can avoid being a present-day fun-sucker, and become a future savings wizard by getting your financial life together now. Spoiler alert: It's much easier than you think. 

What are some of the biggest mistakes you see or hear about when it comes to how millennials handle their money?

That they either can't save or that there's no point in saving because it will never be enough. I can empathize with why it feels pointless to save a small sum of money that doesn't add up quickly. Savings $10 a month only means $120 in a year. But it's important to build the habit.

Can millennials have fun while saving?

Having fun while saving may never be the proper way to think about saving. It's not so much that it's fun, but rather you're making a decision to moderate your spending behaviors in the present so that your future self won't need to work as hard nor for as long. Or you could be focusing on saving for a short-term goal, like paying off debt or taking a vacation. Instead of thinking of what you're missing out on today, you should reframe the thought to consider what you're gaining by deciding against a splurge item. One easy way to motivate yourself early on is to nickname your savings accounts. That means when you log into your bank account, you'll see the purpose for that money right there on the bank account. Maybe it's "New Car June 2018" or "Six Months Emergency Fund" or "Trip to Paris November 2019." Whatever you pick, make it as specific as possible. You can also put your main savings account at a different bank than your main checking account so that you won't be tempted to skim a little off the top each time your checking account feels a little low and you want to go indulge in an activity or purchase. 

What can students in high school do to begin to create savings? Students in college? Post-grads?

Anyone at anyone age should start in two ways: (1) set an actionable goal and (2) automate money out of each paycheck into savings.

Even if that sum of money you're routing directly into savings is a pitifully small sum, you still need to do it! Actionable goal setting is important because it gets specific and makes it easier for you to backward plan. Saying, "I want to save," isn't nearly as helpful as, "I want to save $2,000 this year." Now you can say, "In order to save $2,000 this year, I need to put away $203.33 a month." Getting specific helps encourage you to actually work towards the goal. 

How does your book, Broke Millennial, address these issues? What tips can readers find in it?

It spends an entire chapter covering different types of savings strategies, accounts, and ways to stop being your own worst enemy. But for the actual tips, well, you'll have to buy the book!

What advice do you want to offer to young adults and teenagers who want to save, but feel like they can’t do it because it may seem too hard?

The key is building the habit. Don't stress so much early on about the amount you're saving. Even if you can only afford $5 per paycheck, put that in savings. You may feel like that's pointless, saving the equivalent of a small latte out of each paycheck. It's true that $5 per paycheck isn't going to build your savings quickly. But what it's doing is building the foundation for you to be a lifelong saver. It means you won't struggle to change your behaviors and lifestyle when you start earning more and have less debt. Making a lifestyle shift is much harder, so do your future self a favor and start the habit today. 

Purchase Broke Millennial here to get more money saving tips.