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Why I Don’t Believe in a Budget Anymore: From an Econ Major

Us college students are always strapped for cash, and if you’re anything like me, it can become a big source of anxiety on top of juggling a full college life. For me personally, budgeting my expenses for the month often made me scared to look at my finances by the end of the month. I remember feeling elated when I was even slightly below budget and, worst of all, extremely guilty when I wasn’t.

Stressed Over It GIF by HULU - Find & Share on GIPHY

So why was I, who literally majored in Economics and was always good at managing finances, suddenly looking at money as an all-or-nothing experience? I think the pandemic, and how volatile situations could get for the last two years, definitely contributed to my mentality. After taking a closer look at my spending habits, I noticed that periods of “spending below my budget” during peak COVID times were closely tied to periods of “spending above budget.” That and the rise in prices for eating out, going out and certain grocery items created an illusion in my head that I was always running out of money.

Created an illusion in my head that I was always running out of money

So what did I do? Did I get better at budgeting at the expense of feeling restricted in my lifestyle? Or did I try to make more money to keep up with rising expenses?

The answer is: I forced myself to breathe. And take a break.

Breathe Schitts Creek GIF by CBC - Find & Share on GIPHY

We as college students have a lot going on in our lives, COVID or not. Even though college is expensive and learning money habits early on is good, reinforcing unhealthy patterns in our brain in regards to money is not going to help us grow. Talk to any college-educated adult on the street and they will never be able to put a price on the formative experiences they had in college. As we grow older, every extra dollar we earn gets less and less important, something known in economics as “diminishing marginal utility.” Fancy econ words aside, this means that the concept of “paying yourself first,” whether by saving for something you want to buy or investing a bit out of each paycheck, actually means more right now than it will when we get older.

As we get older, every extra dollar we earn gets less and less important

Do I recommend blowing through your savings after reading this? Of course not. I just wanted to emphasize, to myself and to you who’s reading this, that in the end, it’ll all be okay. There are plenty of opportunities to make more money in the future, and stressing out over it today isn’t going to change that. Use your time right now in college to develop your passions, be healthy and explore yourself as much as you can! Money can always come back, but your time right now can’t.

Somashree is a 3rd year Economics major minoring in Environmental Systems and Society and Digital Humanities. She's a huge cinephile with a special affinity for historical dramas (eg. The Crown or Bridgerton). She also loves learning languages and hopes to learn at least 4 languages by the end of the decade.
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