Here we are again with a New York story, submitted by an anonymous reader, who I've chosen to call Frugal Female:
I am a single, 28-year-old woman who has a BA in American History from an Ivy League college.
I had over $10,000 in savings when I graduated college in 2002, mostly because I took off a semester in the middle to work, and my parents covered food, housing, and tuition while I was in school. (In college, I paid for books, clothing, travel, eating out, movies, etc.) However, I had six months of unemployment, punctuated by stints with several temp agencies and some freelancing, and that, combined with my move to Manhattan in 2003, basically wiped out my savings. I think I had $1000 or $2000 left when I moved to NYC, and my parents had to pay for the movers. I had about $13K in federal college loans, but my parents sold their house in 2002 for reasons unrelated to me, and then paid off my college loans. I moved into a $1100/month apartment in Manhattan with three roommates in 2003, and I think I made $35K that first year, in the non-profit world. I was able to afford food, transportation, and clothing that year, but my parents had to help me with dental and medical bills (no dental insurance, adequate medical insurance) and had to pay for any trips I took home or to visit my grandparents in California.
From 2003-2007, over which time my salary increased from $35K to $48K, I managed to keep my rent at about $1100/month, plus utilities, in doorman buildings in Manhattan, in "converted" apartments--first a two -bedroom converted to a four-bedroom, and later a two-bedroom converted to a three-bedroom. Utilities weren't bad, though, split either three or four ways. My parents bought a new computer for me when my 6-year-old laptop died in 2005, but I was able to pay my own medical and dental bills (totaling $1500--after insurance--in 2006), except for therapy, which I still cannot afford and for which my parents generously pay. (It costs about $4/year even with insurance coverage. I go to an MSW, not a PhD, which is cheaper, and she charges me at the bottom of her sliding scale.) I was not able to save a lot of my increased salary, but I was able to be less dependent on my parents, which was important to me. I have been able to afford things like better work clothes, gym membership, new prescription glasses, charitable donations, and taking guys out on dates, which I couldn't afford at all in 2003 or 2004. I took one nice vacation to Brazil, in 2005, which cost me only about $1500, because I got a free flight and stayed with some distant relatives part of the time. I took one graduate school class in library science, but wasn't sure it was the right path for me, and couldn't fathom how I could ever afford to live in NYC while in graduate school. From 2003-2007, I only managed to save a net of about $5000, plus about $6000 in a 403b through work (partly my own contributions, partly matching funds, at two different non-profit jobs). My friends who live in Washington DC, Boston, and other cities have been able to save a lot more than I, and some of them have bought condos.
This past August, I moved to a new apartment, in a cheaper neighborhood in Manhattan, where I pay $600/month to share a converted one bedroom in a non-doorman building. Since August, with the $500/month I have been saving in rent, I managed to pay myself back for the move (movers and realtors' fees added up to more than $2500--this was the first move that I was able to pay for entirely on my own!) and to finally open a Roth IRA, which has been on my to do list since 2003. I put $1000 in, and I'm hoping to put another $1000 in before April 15.
I would not have been able to afford to live in Manhattan without my parents' help, especially their generous offer to pay off my college loans and their paying for my therapy. On my part, I try to live somewhat frugally. It helps that I am something of a homebody and that I keep kosher, which means that I eat out a lot less than other people do. Good kosher restaurants are very expensive, and bad ones aren't that tasty. I don't like to cook, but I also don't like to spend too much on take-out, so I end up eating a lot of yogurt, sandwiches, veggie burgers, and boxed soups. I like tofu and vegetables a whole lot, and don't eat much meat. I definitely waste too much money on junk food, which leads to the additional problem of my weight fluctuating, which means that I've worn clothing in three different sizes since 2003. I splurge on books and music, mostly, plus at-most-weekly lattes from Starbucks. I never see any shows, which makes me sad, but they're just too expensive. I take full advantage of free summer performances in Central Park, and sometimes see dance performances at Julliard. I take public transportation almost everywhere (including the airport), and only take cabs in extenuating circumstances. I gave up my gym membership because I wasn't using it, and now I'm trying to get enough exercise by walking as much as I can. Last year, when I did this, I managed to walk 2-3 miles/day five or six days a week just by living in Manhattan!
I am a little bit afraid of money and of looking too closely at my finances, since they seem so precarious. I do my own taxes without any special computer program, including itemizing medical and charitable deductions, so I'm not a total neophyte, but I only budget in that I don't spend more in a month than I know I will make in the month--I've never had even a penny of credit card debt to my name. Whenever I have a few extra hundred dollars in my checking account, I move it right into savings (online, interest-paying) and try to forget that it exists. I do sometimes use that money to pay for unusual expenses like travel/vacations, dental fillings and teeth cleanings, and to save for things like a digital camera (don't have one yet) and a new computer (2005 laptop broke in September). That's the only way I have $6000 in savings now. I know that it's not a lot, but it's more than I had in 2003 after six months of unemployment! It's not nearly enough to count as a "rainy day" fund, or to last very long if I should lose my job.
I am planning on continuing to save as much money as I can, both through a Roth IRA and my savings account (plus automatic bi-monthly contributions of $50 to my 403(b), which I don't think about at all) through June 2008, and then probably go off somewhere for a year to find myself. I am applying for a fellowship now that will enable me to do that. If I don't get the fellowship, I will still probably quit my job, since I am quite burned out. I know it's not so responsible, but I need to figure out something that I can do with my life that will earn me a salary over $50K/year, and I can't figure that out while working these administrative jobs that bore me to tears. I might freelance a little bit, and/or take graduate school classes. I might leave New York. I really don't know. I sort of thought that I would be in a different place in my life than I am right now. I wish I was less dependent on my parents. They don't have a lot of money, and I sometimes worry about them jeopardizing their own retirement by helping me out with $1000 here and a $1000 there. They assure me that it's okay, but my sister, who is 30, never takes any money from them and is still paying off educational loans from her BA and MA. She also lives in a cheaper city, where her rent hasn't ever been above $800/month.
So, yeah. New York City is hard. I don't anticipate staying here for the long run at all. Maybe the difficulty of living here is worth it if you get to take full advantage of what the city has to offer. I don't know. I do love the public transportation, Fairway, and the free arts programs in the summer.
This was a wonderfully detailed story. Here is someone who has shared apartments with roommates and made sacrifices to stay frugal while living in Manhattan, but still finds it a challenge to save money on a moderate income, especially after having lived through a period of unemployment and underemployment. She's stayed debt-free and saved some money, but her story shows that things like medical and dental bills can wipe out any extra pennies. I appreciated her honesty about her conflicted feelings about accepting parental help to make ends meet. I wish Frugal Female the best in making that tough decision about whether to stay in NYC.
Other posts in this series:
New York Stories #1: Bronx Chica
New York Stories #2: Orange
New York Stories #3: Bama Babe
New York Stories #4: K