Before you move out, make these 5 money moves
Homeless teens in America make up 40% of homeless youth. If you’re a queer teen, you need serious money prep ASAP. Here are our 5 best money moves to make when you’re gay and 18.
My money moves at 18 and life
I was raised a J-dub (Jehovah’s Witness). Everything I learned about being gay was bad – horrible. This created an internal conflict in me because I knew as early as 9-years-old that I was exactly who my father and minister hated.
I knew what to expect when I told my parents I was gay. They’d kick me out of the house and I’d likely never see them again.
My crystal ball didn’t lie.
When the day came, not only was I scared to lose my family, I was scared of how I’d take care of myself physically, emotionally and financially. In a flash, I’d be alone.
Being raised to believe that ‘the church’ was my caretaker from cradle to grave, I didn’t prepare for what would happen after I said, “Mom, Dad, I’m gay.”
Whether we jump out or are pushed out of the nest, many queer kids and young adults find themselves in similar financial situations with similar fears.
Here’s what I know about preparing to move out when you’re gay and 18.
5 money moves to make when you turn 18
1. Open a free online checking account
A recent survey showed that a whopping 50% of queer respondents claimed they didn’t have a single bank account. That means we’re spending more money on everyday transactions than we have to.
What do we suggest? Open a free online checking out.
Online banks let you open accounts nearly anywhere on your phone, laptop or tablet in about 5 minutes. This is great because you can keep your account away from the eyes of non-supportive parents or family members.
What checking accounts do we like?
Radius Bank’s another favorite online bank because of their 1.00% cashback reward on debit card purchases, plus unlimited ATM fee rebates – no ATM fees – while you’re earning up to 1.20% APY (annual percentage yield or your interest rate).
Again, there are no hidden fees and you can get paid up to 2 days early with direct deposit, but you need a minimum of $100 to open an account.
2. Open a free online savings account
Savings account usually offer better savings rates than checking accounts. That’s because banks expect you to keep your money in the savings account longer. For any extra money that you’ll try not to touch for a long time, open a free savings account.
What savings accounts do we like?
Once you’ve saved $100 to put and keep in a savings account, open a Savings Builder Account with CIT Bank.
Their current base savings rate is 0.40%. You can earn more by participating in their Monthly Savers program. Essentially, if you make at least one $100 deposit a month into your CIT Bank Savings Account, you’ll earn a higher interest rate. Click this link for more details.
The best part of opening an online savings account with CIT Bank is that there are no opening, monthly servicing or online transfer fees.
Note: Most savings accounts have a maximum of 6 account withdrawals a month.
3. Start investing money by investing your spare change
I wish I had learned more about investing when I was younger. It’s one of the smartest money moves for everyone.
Here’s the deal, no one gets rich without learning how to make their money work for them, i.e. investing. That’s investing in stocks, a business or real estate. Had I learned and started earlier, I’d have much more money today.
Learn from my mistake.
The key to investing is starting early, but where should you start? Start simple.
Where to start investing?
Acorns is a simple platform that lets you invest your spare change, building your investments over time with small dollar amounts, rather than a minimum of $25 or $50 a month, like most platforms require.
It adds up quickly, too.
The other cool thing is that you don’t have to be a genius investor. Acorns takes care of the work of investing for you. You answer a few simple questions and Acorns picks appropriate investments based on your answers.
Imagine leaving your parent’s house with a few thousand dollars invested for your protection.
4. Build credit fast
Having a good credit score will save you thousands if not tens of thousands of dollars on credit cards over your lifetime with loans, mortgages, even apartment rentals, cell phone plans and jobs.
Knowing what makes up a credit score is critical in today’s world. A couple of bad moves and, oops!, you’re spending several expensive years in credit score recovery.
Where can you start or improve your credit score?
Credit Karma’s a great place to start. All you need is your social security number, phone number and mailing address.
Once you’re signed up, you’ll get your credit score and a list of what makes up your credit score. You’ll see how much credit you have, how often you’re paying your bills on time, whether you’ve recently opened any new accounts (in case you don’t know) and the total amount of revolving debt you have available.
What should you do if you don’t have a credit score?
Credit Karma will help you start building your credit score. Work those steps. Then, Credit Karma will help you protect your credit score.
Still don’t have enough credit history to have a credit score? Then, you need Experian’s Boost.
Experian Boost lets you use your cell phone and utility payments to start or to improve your credit score.
You don’t have to go it alone. We’re good friends with the people at Experian and we love Experian’s Boost so much, we partnered with them to create a simple guide to build or improve your credit score that includes Experian’s Boost. Best of all – it’s free!
Sign up for our Build or Improve Your Credit Score Powered by Experian Boost. Experian will scan your personal bank accounts and your positive payment history for your cell phone, cable and other utilities to calculate or increase your credit score. We’ll walk you through everything else you need to do.
We’re ready to help now. Sign up here!
5. Get a part-time job (or 2) and a side hustle
If you had to leave home at a moment’s notice, wouldn’t it be nice to have some cash to cover your expenses?
That’s the power of a safety net, and the only way to build a safety net is with a job or with jobs.
It’s also important for queer people to have part-time jobs and side hustles, ways to earn extra money, should we lose one job or be denied housing or services because we’re queer.
Where to find work?
Thanks to the internet, phone apps and an evolution in thinking, it’s never been easier to find enough part-time work online to build a full-time business.
From handy or yardwork for someone’s house or business to house cleaning, which could mean long-term, recurring income, to helping people move (within 50 miles of you), sign up as a Pro at Thumbtack.
For more information on money-smart moves to make if you’re gay and 18, listen to this Queer Money® podcast.
5 Money Moves for Gay Teens on Queer Money®:
How to move out at 18 and afford it
1. Live below your means
One of the biggest mistakes I made when I was younger was spending my money as soon as I got it and then spending more.
No one gets rich spending more money than they make.
The best way to make sure you have money to invest in something like Acorns after paying your bills is by living below your means, spending less money than you earn.
It sounds old-fashioned, but it’s critical to getting and staying out of debt and achieving independence.
How do you live below your means?
- Know what it is you truly want. So often too many of us don’t know what our fabulous life looks like. We know what others want for us. We know what we think we’re supposed to want. We often don’t know what we want. So, get crystal clear on what your fabulous life looks like.
- Then, identify the current habits that prevent you from creating this fabulous life for yourself, and figure out what you must do to overcome those habits.
- Next, implement daily exercises that create the energy to attract your fabulous life. Center yourself. Focus yourself. Give yourself space to tap into your instincts.
- Finally, create a lifestyle, both work and play, that supports building your fabulous life. Be intentional about the places you go, the people you’re with and the things you do. Make sure they all align with your fabulous life.
Had I known how to manage my money like this when I was younger, I would’ve had a lot more money when I was younger – and now. Now you know them and, fortunately, by getting the Fabulous Life Combo you’ll easily design your fabulous life, track your progress with creating the energy and the lifestyle you need.
With the Fabulous Life Combo, you’ll get:
- the My Fabulous Life Worksheet to design your fabulous life,
- the Breaking Bad Financial Habits Worksheet to identify the habits that may keep you from the life you want,
- the Living Fabulous Daily Journal to log your meditation, affirmation, journaling and more, and
- the Living Fabulous Social Life Calendar to create the daily and monthly lifestyle you need to build your fabulous life.
2. Start a budget
A budget is key to not living paycheck-to-paycheck and having more money left over at the end of each month.
There are lots of budgeting apps, but the members of our Credit Card Pay Off Plan and Budget Buster Bundle swear by our budget because it’s detailed and private (it doesn’t require linking an app to their bank accounts).
With the Budget Buster Bundle, Budget Buster Bundle, we walk you through with videos and checklists a simple, step-by-step budget. Use our budget to start tracking your income and expenses. Then, you’ll be sure not to spend money you don’t have and only spend on what really matters to you.
3. Differentiate your needs from your wants
Needs are reasonably priced food, clothing and shelter bought in modest amounts. If your goal is to break free from the Bank of Mom & Dad, you don’t have time to spend money beyond what’s reasonable.
It’s hard to believe it now, but it’ll be easier to sacrifice today than tomorrow.
4. Keep an eye out for lifestyle creep
It’s a sneaky little bitch, lifestyle creep. Lifestyle creep happens so slowly you don’t notice it until it’s too late. Suddenly, your standard of living’s higher than you realized. The types and brands you buy are slightly better.
When this starts to happen, you blow whatever budget you had. The only way to rein it in is checking and re-checking your budget. A budget isn’t a once in a while thing, it’s always.
Being aware of lifestyle creep and budgeting are the best ways to avoid it.
How to move out at 18 with no money
This’ll sound redundant, but in all honesty, your options are limited when you have no money. That’s why, as best as you can, save money before leaving mom and dad’s nest.
If that’s not an option, then . . .
1. Know your game plan
Moving out on your own for the first time with no money should only be done with a rock-solid game plan. You’ll want to know:
- What you’re taking with you?
- Clothing for the current and next season, at least, laptop, phone, etc.
- What, if anything, can you afford?
- Cell phone, food, transportation, etc.
- Where you’re resting your head at night
- A friend or family member’s sofa, shelter, van, hostel – ideally one that permits volunteer work in lieu of rent
- Who, if anyone, will be living with you, or helping to pay rent?
- A friend, partner or someone else
The lesbian couple we interviewed on this Queer Money® quit their jobs to live in a van. But you can’t just live in a parked van anywhere. Hear their creative ways of finding free and cheap places to park their van (and how they built out their van for just $6,000).
Quit Your Job and Travel, She Said on Queer Money®:
Finally, you’ll, also, want to have your resume updated and a plan to get a job if you don’t already have one, which leads to our next point.
2. Get a job
The personal and financial independence that comes with the steady income of a job can’t be beaten. Yes, that’s sometimes easier said than done.
That’s why some people have multiple jobs and why jobs in the gig-economy are so popular now. To add to your Thumbtack resume, try one of these platforms:
- Can you perform work around a house? Make deliveries? Assemble furniture (like from IKEA furniture) or be a personal assistant? Become a Tasker at TaskRabbit.
- Are you a freelancer who specializes in writing, coding, voiceovers, music, social media management or other creative skills? Be a seller on Fiverr and increase your job opportunities + your income.
Here’s a tip, 10X your income prospects by signing up for all three!
3. Open a free checking and a free savings account
You may not have money now, but you will. Getting these accounts opened ASAP will make life so much easier.
4. Brush up on your personal finance knowledge
It sounds self-serving, but you’ll do better with your money the better you understand how money works. Between libraries and the internet, there are a lot of free resources out there.
Start here on debtfreeguys.com and the Queer Money® podcast.
How to move out at 18 and go to college
If you want to go to college, you’ll need money. But the more you avoid student loan debt the better.
With no money, you might think you no options. Yes, your options are limited but they exist.
How to make money for college
1. Essay contests
2. Employer reimbursement
Lots of employers offer tuition reimbursement benefits, meaning they’ll help pay for school while you work. Some of these employers include UPS, Apple, Google, ADP, Starbucks, and Home Depot.
All these companies are LGBTQ-friendly, with several earning a perfect score on the Human Rights Campaign’s Corporate Equality Index.
3. Join the military
If you’re up for the challenge, the military’s a great place to get your tuition paid for and learn skills, which is great for when your service is over. You have four options:
- Armed Forces Tuition Assistance – The specifics (including eligibility, required years of service, application process and restrictions) vary from branch to bran, Army, Navy, Air Force, Marines, Reserves and National Guard. Tuition assistance grants up to $4,500 annually for tuition and fees.
- Post 9/11 GI Bill – Any military member who serves more than 90 days of active duty after September 11, 2001, can qualify to have 40% to 100% of tuition and fees reimbursed for an in-state public college or university or up to $17,500 at a private or foreign university.
- ROTC – With this program, you prepare for military service and go to college at the same time. After graduation, you’ll serve in the Army, Navy, Air Force or Marines – your choice.
- State-Specific National Guard Tuition Assistance – In addition to the National Guard’s offering of tuition assistance, each state offers tuition assistance for its National Guard Service Members. By attending college or university in a particular state, you can cover tuition and fees up to 100%.
How to save money for college
If you’re gonna do it, do it right. Here are the tools to help save money for college.
- 529 Pre-Paid Tuition Plans are state plans that lock in future tuition rates at today’s prices, basically, you’re buying shares of tuition for a semester in the future in today’s dollars. This is best for in-state schools and has little effect on qualifying for financial aid.
- 529 Savings Plans are also state plans. Maximum annual contributions range from $230,000 to $310,000, probably not an issue. Your investment earnings won’t be federally taxed and are typically not taxed by the state offering the plan. 529 Savings Plans do affect financial aid qualification but, again, likely not a concern.
- Advanced Placement Courses are basic, college-level courses, such as English and math, offered to high school students and accredited by the College Board. APCs often carry over into the first year of college and save time and money. But you do need to qualify for them, and you must earn a 3 (qualified), 4 (well-qualified) or 5 (extremely well-qualified) on the final exams to count towards college credits.
Scholarships for gay students
Colleges want a diverse student body and there are lots of organizations making sure LGBTQ students are included. Find one or more scholarships that could work for you:
- Bill Caspare Memorial Fund Diversity Scholarship – Available to full-time junior and senior students who are African American, Asian American, Hispanic American, Native American, multiracial or part of the LGBTQ community and students interested in new media, digital advertising and data science, and have a minimum 3.25 GPA.
- CFPCA LGBT Endowed Scholarship – Wayne State University’s College of Fine, Performing and Communication Arts Lesbian, Gay, Bisexual, and Transgender (LGBT) Endowed Scholarship gives financial aid to meritorious students who demonstrate a positive sensitivity to and involvement in LGBT (lesbian, gay, bisexual and transgender) issues. Preference is given to LGBTQ students.
- eQuality Scholarship – eQuality Scholarship Collaborative gives scholarships for post-secondary education at accredited institutions mostly to residents in northern and central California or students who go to school in northern or central California.
- Freedom from Religion Foundation Catherine Fahringer Memorial Award – A cash scholarship for freethinking high school students, defined as those who identify as atheist, agnostic, humanist or secular and who are accepted into 2- or 4-year colleges.
- IES Merit-Based David Porter Diversity Scholarship – This scholarship is available to any student at institutions that are members or associate members of the IES college consortium and a member of a community that’s been traditionally underrepresented in study abroad programs, such as being LGBTQ. A minimum of a 3.3 GPA is required.
- Levin-Goffe Scholarship for LGBTQI Immigrants – For undergraduate students who are both LGBTQ or intersex and undocumented immigrants, including refugees and individuals seeking or granted asylum.
- PFLAG – As of 2018, the national PFLAG (Parents and Friends of Lesbians and Gays) is on hiatus, but PFLAG chapters across the country offer local scholarships. There’s possibly one in your area. Visit PFLAG.org here.
- Point Foundation Scholarships – The Point Foundation’s Scholarship are awarded to out LGBTQ people with a track record of leadership and community involvement, a strong academic achievement, been working for the betterment of the LGBTQ community, in need of financial aid and enrolled or intending to enroll in an accredited college or university in the U.S.
- Pride Foundation Scholarships – Pride Foundation provides essential financial resources and community support to inspirational LGBTQ+ and allied student leaders across the Northwest.
There’s a lot to consider with leaving mom and dad’s home when you’re gay and 18. Do yourself a favor and make a plan using some (or all) of my tips above. Having been there, I know what it takes to make the transition easier.
There are resources. Use them.