It takes money to make money, or so they say. And this doesn’t just pertain to opening a new business — sometimes even a stable job with a salary and paid vacation comes with hidden costs.
Besides the obvious expenses such as a business wardrobe, some companies foster a culture that has its employees exercising their credit cards to either keep up appearances with clients or to simply fit in at the office.
So how can you stay afloat while facing the conflicting demands of these expenses and the reality of a middling starting salary and student loan debt? Below is an examination of the hidden costs of work and how not to go broke building a career.
Unexpected expenses to watch out for at work…
It seems pretty counterintuitive that the place where you earn money can end up costing you money. But sadly, it’s true.
From the student loans you might have taken out to get a degree to land the job, to the price you pay to dress appropriately and get to work, the expenses can really add up. But what about the costs you’re not ready for?
Here are just a few you might encounter:
- Frequent happy hours you feel pressured to attend to show you’re a team player.
- Cabbing home after those happy hours, or after late nights in the office.
- Regularly splitting the bill at lunch, even when you ordered a salad and they all had steak.
- Ordering lunch and dinner because long hours don’t leave you time to shop or cook.
- Buying lots of books or taking expensive courses to improve your skills.
- Feeling pressured to wear designer brands to match your office’s or clients’ culture — and, if you’re female, you might even find yourself spending more on makeup and blowouts.
- Having to drive a certain type of car to show clients you’re at their level.
Sometimes the expenses are clearly required, such as when blogger Kayla Sloan was told she had to buy clothes and shoes from the store she worked at to “show off the products and stay ‘in season.’”
Other times, you might not be explicitly told to do these things, but still feel an underlying pressure to comply.
So what’s a career-minded-but-also-indebted college graduate to do? As financial behaviorist Jacquette Timmons says, “be mindful of expense creep.”
… and how to manage your money amidst the pressure to spend
When you want to succeed at work, especially early in your career, you might feel like you have no choice but to succumb to the pressures to spend your hard-earned money. But if you’re also facing student loan debt, then you could find yourself losing progress in your payoff. Or worse, you could find yourself in credit card debt just to keep up.
Here are a few things you can try in order to creatively circumvent the hidden costs of work:
- If you feel you must go to happy hours, order a soda with lime and nurse it — chances are no one will know you’re not drinking alcohol.
- If you cab home after happy hours or late nights, ask coworkers to split the ride.
- Propose eating outside for lunch on a nice day — that way you can pack and others can buy, and it won’t make a difference. During cold months, slow down on the work lunches or suggest not splitting the bill. (Others might be just as annoyed by the habit as you, after all.)
- If you purchase items such as books or courses to grow your skills, talk to your boss about what can be reimbursed beforehand. If the answer is nothing, save your receipts — that’s a tax write-off.
- If you have to wear designer clothes, only do so on the staples (such shoes, a jacket, or a skirt or pants) and only in neutral colors. That way you can wear your staples over and over again and mix in other clothing items on the cheap — without actually looking cheap.
- If you need to drive a certain type of car, consider leasing instead of buying — that way if you leave the job, you won’t be stuck with the car and its monthly bill for forever.
As for making sure any amount you have to spend doesn’t get out of control, the key is tracking your expenses.
In Timmons’ words, tracking what you spend helps you “get a handle on the ‘hidden expenses’ that may be preventing you from paying off your student debt.” What’s more, it can help you understand if there are areas that really do need cut-backs.
Focus on building your resume, not your credit card debt
It’s not easy saying no to the hidden costs of work, but at some point, you might have to draw the line to save your budget and avoid falling deep into debt.
If you’re getting to that point, cut what you have to, and do the rest in moderation. Once you get used to tracking your expenses and even putting your foot down on extraneous costs, you might find room freed up in your budget for the work commitments you actually want to spend your money on.
Let this be the first lesson of the real world: It’s all about balance when you create a strategy to achieve both your professional and financial goals.
Interested in refinancing student loans?Here are the top 6 lenders of 2019!
|Lender||Variable APR||Eligible Degrees|
|Check out the testimonials and our in-depth reviews!
1 Important Disclosures for Earnest.
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest fixed rate loan rates range from 3.89% APR (with Auto Pay) to 7.89% APR (with Auto Pay). Variable rate loan rates range from 2.47% APR (with Auto Pay) to 6.97% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of Month/Day/Year, and are subject to change based on market conditions and borrower eligibility.
Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.
The information provided on this page is updated as of 08/21/18. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at firstname.lastname@example.org, or call 888-601-2801 for more information on ourstudent loan refinance product.
© 2018 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.
2 Important Disclosures for Laurel Road.
Laurel Road Disclosures
APR stands for “Annual Percentage Rate.” Rates listed include a 0.25% EFT discount, for automatic payments made from a checking or savings account. Interest rates as of 11/8/2018. Rates subject to change.
Variable rate options consist of a range from 3.27% per year to 6.09% per year for a 5-year term, 4.64% per year to 6.14% per year for a 7-year term, 4.69% per year to 6.19% per year for a 10-year term, 4.94% per year to 6.44% per year for a 15-year term, or 5.19% per year to 6.69% per year for a 20-year term, with no origination fees. APR is subject to increase after consummation. The variable interest rate will change on the first day of every month (“Change Date”) if the Current Index changes. The variable interest rates are based on a Current Index, which is the 1-month London Interbank Offered Rate (LIBOR) (currency in US dollars), as published on The Wall Street Journal’s website. The variable interest rates and Annual Percentage Rate (APR) will increase or decrease when the 1-month LIBOR index changes. The variable interest rates are calculated by adding a margin ranging from 0.98% to 3.80% for the 5-year term loan, 2.35% to 3.85% for the 7-year term loan, 2.40% to 3.90% for the 10-year term loan, 2.65% to 4.15% for the 15-year term loan, and 2.90% to 4.40% for the 20-year term loan, respectively, to the 1-month LIBOR index published on the 25th day of each month immediately preceding each “Change Date,” as defined above, rounded to two decimal places, with no origination fees. If the 25th day of the month is not a business day or is a US federal holiday, the reference date will be the most recent date preceding the 25th day of the month that is a business day. The monthly payment for a sample $10,000 loan at a range of 3.27% per year to 6.09% per year for a 5-year term would be from $180.89 to $193.75. The monthly payment for a sample $10,000 loan at a range of 4.64% per year to 6.14% per year for a 7-year term would be from $139.65 to $146.76. The monthly payment for a sample $10,000 loan at a range of 4.69% per year to 6.19% per year for a 10-year term would be from $104.56 to $111.98. The monthly payment for a sample $10,000 loan at a range of 4.94% per year to 6.44% per year for a 15-year term would be from $78.77 to $86.78. The monthly payment for a sample $10,000 loan at a range of 5.19% per year to 6.69% per year for a 20-year term would be from $67.05 to $75.68.
However, if the borrower chooses to make monthly payments automatically by electronic funds transfer (EFT) from a bank account, the variable rate will decrease by 0.25%, and will increase back up to the regular variable interest rate described in the preceding paragraph if the borrower stops making (or we stop accepting) monthly payments automatically by EFT from the designated borrower’s bank account.
3 Important Disclosures for SoFi.
4 Important Disclosures for LendKey.
Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.
5 Important Disclosures for CommonBond.
Offered terms are subject to change. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900). If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, the loan term selected and will be within the ranges of rates shown.
All Annual Percentage Rates (APRs) displayed assume borrowers enroll in auto pay and account for the 0.25% reduction in interest rate. All variable rates are based on a 1-month LIBOR assumption of 2.28% effective October 10, 2018.
6 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|2.57% – 6.97%1||Undergrad & Graduate|
|2.47% – 6.99%3||Undergrad & Graduate|
|2.68% – 8.77%4||Undergrad & Graduate|
|3.24% – 6.66%2||Undergrad & Graduate|
|2.61% – 7.35%5||Undergrad & Graduate|
|3.01% – 9.75%6||Undergrad & Graduate|