Part 3: Personal Finance 101 — Debt, Budgeting, Giving

Note: this article is based on the US system with additional information for international students in the US. This article is also targeted at 20-somethings but applicable to all.

Parts of the series (these are all equally important)

  1. Banking, Credit Score, Savings
  2. Investing
  3. Debt, Budgeting, Giving


The good news (actually really really bad news) is that there is a huge community of people online to support people paying off debt. Again, controlling debt, along with emergency savings and investing, are pillars of financial stability (many people tackle all three simultaneously, it may be different in your situation)

The two most popular methods for paying off debt are the snowball method and avalanche method. First,

  • Write out the name, the amount, and the interest rate of what you owe
  • Make the minimum payments on all debts except for the one you are focused on paying off first
  • If you follow the avalanche method, pay off debt from the highest to lowest interest rate (this minimizes interest payments)
  • If you follow the snowball method, pay off debt from the smallest to largest amount, regardless of interest rate (this may seem counter-intuitive but there’s powerful psychology behind seeing yourself successfully pay off balances in full)

There’s a huge Youtube community around debt and a channel I really like is Lo Mills (but just search debt free journey for tons of resources)


Budgeting, like everything with personal finance, is personal and also should be considered a work in progress. I’ll list the methods I use, along with popular apps others have recommended

Google sheets (mine is super simple and gets adjusted with time). I track:

  • Take-home pay: after tax, retirement, and benefits are taken out
  • Category of expense: essentials, food, investing/savings, donations, and fun
  • The actual name of the item i.e. rent, utilities, groceries, dine out, Roth IRA, downpayment fund, donations, subscriptions, lessons, gym, shopping, miscellaneous
  • What I budgeted and what the actual expense was

In this google sheets, I also chart:

  • Categories of expenses as a percentage of take home pay (for example somebody may aim for 20% essentials, 10% food, 40% investing/savings, 10% donations, 20% fun)
  • The date of monthly bills (that way you know how much you need in your account on various days of the month)
  • A list of my company benefits (I do this just because I feel like if it’s offered to me, I’m going to take advantage of it and I don’t want to forget…)


  • Note: read about how Intuit (who owns Mint and Turbotax) lobbies the government to avoid free-filing and a simplified tax code
  • Mint allows you to connect various accounts and does a pretty good job of auto-categorizing expenses into a monthly spending breakdown. I use it to verify my actual expenses against planned expenses in Google Sheets.

Personal Capital

  • This allows you to connect various accounts to see your net worth over time. A limitation is that it does not allow you to connect international accounts and even some US accounts.
  • YNAB and EveryDollar are paid apps for the committed user, who wants to ensure every dollar they make is accounted for in their expenses
  • TrueBill proactively finds where you can save money and even negotiates on your behalf.
  • Envelope system. The envelope system has many proponents on YouTube. I personally hold little to no cash, but this system has worked for many!

When it comes to budgeting (and personal finance/ life) don’t worry about perfection, just try to move in the direction of good.


The point of learning about personal finance is so that you control your finances, and not the other way around. If possible, it’s really worthwhile to give a lot of it away.

I have a lot to say on this subject (again, for another day) so here are some preliminary thoughts:

  • If you’re fortunate enough to be financially well-off, consider reading Peter Singer and other effective altruists (the notion being there’s little logic in not giving away a large portion of your income if you are good at making money). I/ you may not fully agree with this philosophy, but I think giving some percentage of your income if you can is in the direction of good.
  • There are lots of types of doing good: giving money, social influence, direct volunteering, the way you raise kids/ treat others. Think about which combination works best with your personality and life.

In terms of being thoughtful around financial giving:

  • I keep a spreadsheet with the amount to donate each month (as a percentage of my income)
  • Research the effectiveness of each charity (Donational and CharityWatch are good resources)
  • List the names and amount for each organization
  • Set up monthly recurring donations so I’m not tempted to skimp this month or next because I want new shoes

In the future, I want to write about other personal finance topics as I gain experience with them (such as tax, real estate, updates to this plan), but I’ll leave it here for now!

In part 1 of this series, I write about which bank accounts to open, why a credit score is important and how to get a high one, as well as how to save for huge life events like buying a house. Read part 1 here.

In part 2 of the series, I write about investing (which order to fund which accounts, and how to think about portfolio allocation). Read part 2 here.

Hope this was useful, and remember, don’t let perfection be the enemy of the good, so just get started!

Disclaimer: The information provided, opinions expressed, resources cited, and service providers mentioned in this post are not intended as, and should not be construed as, financial, tax, or legal advice. I am not an attorney, tax preparer, accountant, or financial advisor, and I do not hold myself out to be any of those professionals. The contents of this post are not a substitute for legal, tax, and financial advice from a professional who is aware of the specific facts and circumstances of your individual situation. I expressly recommend you seek advice from a professional on these matters. I do not sponsor, endorse, verify, or warrant the accuracy of the information found at external sites or subsequent links. The opinions expressed in this post are solely my personal opinions and are not connected in any way to any past, present, or future employer.