Oh No, the Real World

August 23, 2019

This is the story of Jill, who recently graduated from college with a degree in marketing.  Right before graduation, she landed an entry level job at a local bank doing marketing and client outreach.  Her starting salary is $45,000 a year with a matching 401k and 75% of her medical insurance costs covered. 

Jill is excited and goes out to celebrate. Then she starts looking for an apartment, since she will be making enough to live on her own.  Up to this point in her life, Jill’s parents have helped her out a lot by guiding her along the way.  Now Jill is on her own, but she has a job and can handle it.

Jill finds an apartment quickly and starts her new job.  Jill goes out to eat, buys stuff she needs for the new apartment, and puts it all on her credit card because she is expecting a fat paycheck on the 15th from her new job.

Pay day lesson

Pay day comes and Jill checks her online banking account to find a direct deposit of $1,197.52.

Jill is silent, horrified by the amount. $677.48 out of my paycheck… how can that be? Jill thinks to herself.  Jill thinks there has been a mistake, so she logs onto her company’s HR portal to view her pay stub.  FICA, Federal Income Tax, State Income Tax, and Health Insurance are all listed as deductions.  There are so many deductions that Jill freaks out, because she already spent most of her paycheck before she even received it.

Forgotten financial goals

Jill has some student loans, which is her only debt, and she knows that she should save for retirement, but paying anything more than the minimum on her loans while also saving for retirement seems all but impossible.  She wants to have a life and do things -- how can she do this and still have fun?

A financial coach in your pocket

Jill had never created a budget and really did not want to create one on her own.  She wanted help controlling her spending so that she could have some fun, but also pay off her debt as soon as possible and save for retirement.  She decided to get help by using an advisor, the spending guru, to start saving and get advice between savings, paying off debt, and having fun.  Once she committed to a spending plan based on the advisor’s recommendations, they helped her stay on track by sending her reminders to reduce her spending and to make sure she was saving for retirement and paying off her debt.

This is a hypothetical example and is not representative of any specific investment. Your results may vary.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.