Episode 45: How to Budget Your Money as a Nurse
In this episode, we are going to talk about how to budget your finances. Being financially smart is a great life tool! For the health news, we’ll learn what it means when Food is considered “highly processed”.
What Are Highly Processed Foods?
What does it mean when foods considered “highly processed”?
By definition, processed food is a food item that has had a series of mechanical or chemical operations performed on it to change or preserve it.
Processed foods are those that typically come in a box or bag and contain more than one item on the list of ingredients. For most of us, it’s not realistic to avoid all processed foods. Some are actually very healthy, like pre-cooked whole grains, Greek yogurt, nut butter, organic stock, tofu, frozen vegetables, and unsalted canned beans.
Look at the ingredient list, and ask yourself if it’s something you could make at home. If it can only be made in a lab or through a chemical process (like high-fructose corn syrup, hydrogenated oil, soy protein isolate, or aspartame)
Low-fat foods like crackers, cookies, and salad dressings often have added sugar and salt to make up for flavor, and gums or stabilizers are added to make up for texture. Some even have more calories than their higher-fat counterpart.
Whole-wheat loaf bread: There’s a reason those perfectly sliced, long rectangular loaves sit on the shelves for weeks at a time without spoiling. They contain artificial preservatives to help maintain freshness. Buy whole-grain bread from your local bakery, where ingredients are kept simple with just flour, water, yeast, oil, and salt.
The bad news: Meatless burgers are heavily processed and high in saturated fat
The same can’t necessarily be said of the aforementioned beef substitutes, which have been created to mimic what many people love about a burger — the red juicy center and meaty taste. Along with the ambition to replicate hamburgers comes a comparable amount of saturated fat. Since diets higher in saturated fat are associated with increased rates of both heart disease and premature death, they may not be the type to opt for if your ambitions are purely health-related. They are also a significant source of sodium, particularly for those on salt-restricted diets.
Although manufacturers are working to eliminate trans fat, if a product has less than 0.5g of trans fat, manufacturers can still claim it has 0 grams of trans fat. Trans fat is considered by many doctors to be the worst type of fat you can eat.
Just because a product might read “natural” or “organic” doesn’t necessarily mean it’s better for you.
How to stay financially stable
Don’t go crazy with your paychecks as a nurse
- This is for the new grads, I’m sure you got a nice bump in your salary but this doesn’t mean you’re a high roller now.
- After living as a student, having a regular salary can feel like a windfall. But if you don’t watch how much cash you’re dropping, it’s easy to go into debt.
- This also means buying things you can afford to pay in full, just because you have that income now doesn’t mean you’ll have it in the future.
Weigh out the positives and negatives of a purchase.
- If you see something you want online don’t buy it right away, close out the screen. If you really wanted it and it wasn’t a spur at the moment you’ll remember to buy it later and this gives you a time to actually think if it’s worth buying, instead of buying on emotion.
Know your employer’s benefits
- For full-time RNs employed at healthcare organizations where your employer contributes to a 401(k)-retirement account, this may be the best option for you. If so, be sure to max out that benefit as it’s free money.
- For travel nurses or part-time nurses, setting up an IRA (individual retirement account) may be the smarter, more flexible way to save for retirement as they can easily be taken with you regardless of your employer.
- Assume your employer offers a 100% match on all your contributions each year, up to a maximum of 3% of your annual income. If you earn $60,000, the maximum amount your employer would contribute each year is $1,800. To maximize this benefit, you must also contribute $1,800. If you contribute more than 3% of your salary, the additional contributions are unmatched. If you contribute $5,000 in a single year, your employer maxes out the matching requirement, giving you a total contribution of $6,800.
Pay off Debt
- Credit card debt usually has the highest interest.
- Your first priority in taking control of your financial well-being should be to pay off any outstanding credit card debt. If you don’t pay the monthly minimum, your credit score will plummet, which will make it challenging to get a good rate on any car loans or mortgages in the future.
- If you don’t pay off the entire balance each month, you’re merely throwing money away on extremely high-interest rates.
- Go through all your debt and make it a priority to pay off the high-interest ones first.
Create a monthly budget
- To create a monthly budget, nurses should add up all of their necessary monthly expenses against their monthly earnings. Creating a budget provides a clear understanding of your financial situation. If you don’t have enough income left over to put a little aside each month, you need to rethink your lifestyle and revisit your expenses.
Create an emergency fund
- Unforeseen expenses happen. If your car breaks down, would you be able to pay for repairs? If you have a medical emergency and are out of work, would you be able to pay rent or your mortgage? Before you spend money on other goals and purchases, save at least three months of living expenses.
Where to put your money
There are a few options for people to put their money in.
- There is a traditional savings account where it is good to keep some money for emergencies and a little extra but these don’t give you much interest. Some other options are:
- Money market account: money market accounts usually have other restrictions besides limiting the number of monthly transactions, such as a required minimum opening deposit amount or a minimum balance that must be maintained.
- Certificates of deposit: For individuals who do not expect to need access to their savings for at least a year or two, there are certificates of deposit (CDs). The longer the term that customers are willing to have their money tied up, the higher the interest rate available. One-year and two-year CDs offer higher interest rates than are currently available on traditional savings accounts.
- Stocks: higher-risk investments into companies
- Real Estate: buying commercial real estate or private housing. There are also companies out there that allow you to invest in real estate with a minimal amount of cash.
- Online checking accounts: some provide more interest than savings accounts.
- Invest in yourself: Get higher education or take classes you enjoy. Some people make a lot of money from their hobbies. If you enjoy making certain things you can sell those on Etsy or other platforms. Maybe you like to teach, start a youtube channel or even vlog about your life.
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