I'm 21, Broke, and Barely Surviving: A Comprehensive Guide to Overcoming Financial Hardship

Introduction

If you're watching this video, you're probably in a tough spot. Let's talk about being 21, broke, and barely surviving. I've been there, and I've learned some valuable strategies that can help you. So, let's dive into some ways to overcome financial hardship and come out on top. For the record, the origin of this article comes from a Reddit post I found and made a video on. In the video, I gave my insights into the financial struggles of a young man who struggled with a neglectful mom, an absent father, a lack of degree, and the stress of living paycheck to paycheck. If you'd like to watch the full version of the video to get more context to my advice, please be sure to check out that video, which can be found below. 

Finding Additional Income

It's clear that finding additional income is crucial in a situation like this. Here are a few strategies I would recommend:

Get a job or multiple jobs that allow you to make additional streams of money. Work as much as possible to increase your income. Tailor your work hours based your personal energy levels and needs. 

So, for example, if you are deep into the negatives, I'd consider cutting back on essentially all luxuries and recreation and work as much as possible until you at least break even. Once you've managed to breakeven, I'd consider possibly reducing your hours a little bit to allow yourself some free time. From personal experience, I've learned that you can't work at a high capacity endlessly. Inevitably, you will burnout and your performance will begin to decline. 

By scaling down your work hours once you've managed to breakeven or create a slight nest egg, you enable yourself to play an effective financial game for the long term. 

Start by looking for part-time or full-time jobs, and don't be afraid to take on multiple jobs to increase your earnings.

When I was in my early twenties, I desperately needed money. I was trying to get back into college but, in the meantime, I also had the essential expenses to pay like car insurance, rent, food, student loans, etc. What most people don't consider is that many retail jobs that offer easy employment often cut hours significantly, making your income extremely unstable. Additionally, due to the nature of these jobs requiring little to no training or skill, you are highly replaceable. This puts the employee in a vulnerable position where negotiating pay, hours, flexibility, etc. is very difficult.

Having multiple jobs might be a necessity if your employer is unwilling to give you 40 hours/week of employment or if the employer has a habit of providing inconsistent hours. 

I recall many times, especially when working at a movie theater and at Brooks Brothers, where I'd get 38 hours one week--a livable wage at $12/hr. when you have roommates and get each cheap food--to getting only 10 hours the next week. For anyone not keeping up with the math, my gross income could easily go from $456 one week to $120 the next. As you can imagine, the low gross income combined with an unpredictable work routine made having 2-3 jobs a necessity. 

Around the age of 24, I was working at Brooks Brothers, American Eagle, as a SAT and Productivity tutor with a company called Varsity Tutors, and as a Real Estate Agent with Weichert, Realtors. And at this point, I was still just barely getting by. 

Consider finding remote work opportunities or online jobs that you can do from home. Look for data entry, virtual assistant, or other similar roles.

If you're struggling to find a job that requires driving, consider walking to a nearby workplace to avoid transportation barriers.

While I've found that many corporate jobs don't necessarily like the idea of a potential employer walking in and asking for a job, I've found that local restaurants and retail jobs are far more forgiving. 

As a college student, I often struggled to find even minimum-wage jobs. The applicant pool was high and managers seemed to pick employees at random. Frustrated, I recall one day hearing from a friend that he'd quit his job as a dishwasher at a local Irish Pub. The job paid $12/hr., which was a lot of money for me at the time. 

(Keep in mind that my current jobs during that time were a freelance writer for a startup that paid essentially pennies per article I wrote and as a gas station attendant where I made a whopping $8.25/hr.--I'd received a pay increase due to my hard work).

Desperate to make more money and get a significant pay increase, I walked to the Irish pub right as it opened when I knew the hiring manager would be there. I handed my resume to Kevin, the store manager, who glanced at it, told me dishwashing was very difficult, and asked if I had experience with the machine they used. 

"No. But I'm a fast learner", I replied with a grin.

Kevin smiled back. I think he liked my fake confidence.

"When can you start?"

"Today. If you need me".

Kevin chuckled a bit, showed me the kitchen area, and introduced me to my new best friend--a large industrial dishwasher that was surrounded by cabinets of trays, bins, plates, mugs, and utensils. On the spot, he gave me the job. This was a strategy I'd use two more times to get jobs--once at a Brooks Brothers in Northern VA and also to get a manager position at a Halloween City. Again, do I recommend this tactic for a corporate or office job? Not necessarily. While you can be creative and perhaps mail your resume in or offer a gift of some kind to stand out if you're trying to get the attention of your dream employer, I can't confirm from firsthand experience if this would be favorable. However, desperate times call for desperate measures and if you find yourself struggling to find employment, this method can be something to keep in mind. 

Developing Credit

If you're in a tough financial situation like the one described in the referenced video, it's crucial to start building your credit. Honestly, even if your finances are relatively good, I still recommend understanding how credit works and how to use it strategically. I wrote an article a while back entitled: Guide to Credit that I highly recommend you read if you're completely new to credit, what determines your credit score, and how credit functions. In the meantime, here are some strategies and tips that I would recommend if you're completely new to credit:

• Start by opening a secured credit card with a down payment that will serve as your credit limit. Use this card to make small purchases, such as groceries, and pay it off instantly. This will help you build up your credit score over time.
  

• Continue to use your secured credit card responsibly, paying off the balance in full each month. This will show lenders that you are capable of managing credit effectively.
  

• After a period of responsible use, you can work towards obtaining an unsecured credit card, which will offer a higher credit limit and more flexibility.
  

• As your credit score improves and you understand credit more effectively, you'll be able to also use certain cards, which offer points and rewards. 
  

• Once you've established good credit, you may be able to qualify for other forms of credit, such as a car loan or a personal loan, which can help you build a positive credit history.
  

• Remember, building credit takes time and discipline, but it can open up opportunities for better housing, lower interest rates, and improved financial stability in the future.

Sadly, the general education system does a terrible job at teaching finances. Rarely will a student receive an in-depth look at how credit functions and how it can be used appropriately that's presented in a comprehensive manner.

If you're interested in learning the basics of finance as well as some advanced concepts such as the importance of credit, how to buy real estate, long term investing strategies, and the importance of liquidity, try out my FREE No Fluff Finance Course

To my recollection, there wasn't a single finance course that was mandatory for all students in high school or college. What many fail to acknowledge is that using credit strategically can create opportunity that is otherwise difficult to obtain. This opportunity is known as Leverage.  Leverage, from a financial perspective, is essentially using something small to gain something big. A few examples of this:

• A good credit score can help you gain access to a house that costs $300,000 while only using $15,000 of your own money.
  

• A good credit score can help you start a business with a line of credit that might enable you to purchase goods or advertising faster than normal in order to receive a return on your investment faster with less personal risk.
  

• A good credit score might enable you to access a credit card with a high credit limit and the ability to withdraw cash in the form of a cash advance. The cash advance can be a loan to make a big investment. 

To provide a real-life example, a friend of mine was interested in buying a house and needed a $8000 to put toward his down payment. He had a high limit on his credit cards and liquidated the $8000 from his cards in the form of a cash advance in order to purchase the house. He initially rented the house for $2000/month. Eventually, the house increased in value and upon selling it, my friend made about $15,000 cash. With the rent payments he was receiving, he managed to pay off his credit card debt in a few months. From there, he managed to increase his overall income. The additional rent payments he earned plus the payout from selling his house allowed him to purchase more houses and begin his real estate portfolio. This is an example of using credit as leverage.  Making Smart Financial Choices When facing a difficult financial situation, it's crucial to make smart financial choices to improve your circumstances. Here are some ideas to keep in mind:

• Find additional income: Look for part-time or full-time jobs, and consider remote
  

• Manage your expenses: Cut down on fast food, takeout, and processed foods, and focus on buying groceries to reduce unnecessary spending.
  

• Prepare for the worst: If facing a potential eviction, start preparing for alternative living arrangements, such as finding roommates or seeking help from friends.
  

• Plan for the future: Work hard, save money, and focus on building a strong credit history to eventually move into a better living situation.
  

Managing Living Expenses

Managing your living expenses is crucial when you're facing financial hardship. While my overall belief is that increasing one's income should be a primary goal and reducing expenses is secondary, living below your means will make your long term financial goals far more attainable. Here are some strategies to help you make the most of your income and reduce unnecessary spending:

Track Your Spending Take the time to figure out exactly where your money is going so you can identify areas where you can cut back. Many finance gurus advocate for budgets. Personally, I don't like budgets. I'm not saying they can't work. However, I find them overly restrictive and tedious to keep track of. It's similar to dieting in my eyes. Just like trying to overanalyze and track every meal you put into your body tends to lead to people crashing on their diets and bouncing back to where they started or worse, budgeting excessively is no different. It's possible to budget so much that you never do anything with your money, which defeats the purpose of money. On the other hand, simply knowing what your biggest purchases are and scaling back is, in my opinion, much simpler than over optimizing your budget.  The major expenses I'd recommend looking at are:

• Housing

• Car Payments

• Food

• Insurance

• Investment
  

Reduce Fast Food and Takeout Instead of spending money on fast food and takeout, focus on buying groceries and preparing meals at home. This can save you a significant amount of money over time. As a broke college student, I once thought that eating fast food was cheaper. Seeing a burger at McDonalds for $1.50 was enticing. And having a full stomach off of a cheap meal seemed to make sense mathematically. Plus, it was simpler than grocery shopping or cooking. However, when I stopped to do the math, I realized how much money I'd been throwing away. Two burgers at McDonalds might cost me $3 or $4, sure. But I could buy a case of 12 frozen hamburger patties for $7 or $8. This would literally make each burger about $0.70. Even if you were to add your own cheese, vegetables, and make your own fries, it'd likely still be cheaper than a meal at McDonalds.  

Find Deals and Discounts Use apps and websites to find discounts on groceries and other essentials. Being smart about your purchases can help you save money in the long run.

Consider Alternative Transportation If you don't have a car, look into public transportation, biking, walking, or carpooling to get around. This can save you money on transportation costs. And if a car is necessary, consider purchasing an extremely basic car in all cash. Look for a vehicle that is east and inexpensive to repair as it will offer the most longevity from a financial perspective.

Improving Mental Health and Coping with the Situation

Living in a difficult financial situation can take a significant toll on your mental health. It's important to recognize the impact it's having on your well-being and take steps to cope with the situation. Here are some strategies to help improve your mental health and navigate through tough times:

• Seek Support: Reach out to friends, family, or even a mental health professional for support. Talking about your situation and getting advice from others can provide a sense of relief and comfort.
  

• Focus on What You Can Control: It's easy to feel overwhelmed by all the challenges you're facing, but try to focus on the things that are within your control. Set small, achievable goals for yourself and celebrate your successes, no matter how small they may seem.
  

• Practice Self-Care: Take time for self-care activities that help you relax and de-stress. This could include meditation, exercise, reading, or engaging in hobbies that you enjoy.
  

• Avoid Comparisons: It's natural to compare yourself to others, but this can often lead to negative emotions and feelings of inadequacy. Remember that everyone's situation is different, and your journey is unique to you.
  

• Stay Positive: It's important to maintain a positive outlook, even in the face of adversity. Remind yourself of your strengths and resilience, and look for opportunities to improve your situation.
  

Final Thoughts and Encouragement

It's clear that being 21, broke, and barely surviving is a tough spot to be in. Finding additional income, developing credit, and making smart financial choices are all crucial steps to overcoming this financial hardship. Remember, building credit takes time and discipline, but it can open up opportunities for better housing, lower interest rates, and improved financial stability in the future.

It's important to recognize the impact that living in a difficult financial situation can have on your mental health. Seek support from friends, family, or mental health professionals and focus on what you can control. Practice self-care, avoid comparisons, and maintain a positive outlook, even in the face of adversity.

If you're living in a tough financial situation, it's crucial to consider moving out and finding a new living situation. Look for additional income, develop credit, secure housing, find a roommate, save money, and work on building a strong credit history to eventually move into a better living situation. Dealing with family dynamics can be challenging, especially when facing financial hardship. It's important to create a plan for improving your circumstances and take matters into your own hands.

Overall, it's important to remember that dealing with financial hardship requires resilience, determination, and a strategic approach. By focusing on the steps outlined in this comprehensive guide, you can begin to overcome your current situation and move towards a brighter financial future. Stay strong and keep working towards a better tomorrow.

If you want to learn more about productivity tips from books, check out some of the other articles on my website.

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Leviticus Rich is the premiere productivity expert and productivity coach located in the DC Metro area within Northern VA. 

Leviticus has helped thousands of people improve their time management, focus, and productivity by offering some of the best, science-backed advice and techniques in the modern era. 

P.S. If you need help managing your productivity and destroying procrastination, click the link here to sign up for free productivity coaching. 

If you want more resources or guides on how to boost your finances, fitness, or lifestyle, click the link here.