5 Things All Interns Need to Know About Their Money

 
When you get that first internship offer, you probably have a million questions racing through your mind. When will you start? Will they train you? When will you meet your manager? What will a typical day be like?

But for many interns, the biggest question is: Is it paid or unpaid? And if it’s paid, how much will you be making?

As an intern and college student navigating life during a recession, we know you have a lot of questions when it comes to your finances. Today, we’re going to cover the five things all interns should know about their money.

1. Your paycheck might look . . . different than you expected. After negotiating an internship salary, you probably multiplied your hourly wage by total hours worked and felt pretty darn excited. However, when you get your first paycheck, you might feel a bit underwhelmed. Once you subtract insurance, taxes, and your contribution to your 401k, your paycheck could be quite a bit smaller than you’d thought, so keep that in mind when doing your financial planning. Remember that you can always go to HR with any questions about your take-home pay.
2. Setting a budget can make all the difference. Life is all about balance, and setting a budget can help you pay the bills on time, save for the future, and enjoy the occasional soy mocha latte. And budgeting is especially important on an internship salary, which is often at the lower end of the spectrum. While setting a budget can feel overwhelming, start by tracking how much you spend each month. Then, set some basic financial goals by deciding how much you can afford to save. Even if it’s just a dollar a day, it will eventually add up.
3. This might be the time to get a credit card. Now that you’re making money, you’re probably thinking about the future—and that means considering how to build credit. The sooner you get a credit card, the sooner you can build good credit, which allows you to buy all sorts of big-ticket items later in life. But one word of warning: only get a credit card if you know you can pay it off on time every month!
4. If you can swing it, start a Roth. As soon as you start making money, you can start planning for retirement. And if you’re looking to save money now but think you’ll be making more money in the future, one of the smartest ways to save is by putting money into a Roth IRA. What does that mean? Well, when you put money into a Roth IRA, you pay taxes immediately, and then the fund grows tax-free. That means you won’t be taxed at a higher rate later on, even if you’re making way more money down the line.
5. Think of this internship as your gateway to a full-time role. If you’re making minimum wage or doing an unpaid internship, you might be wondering if your internship is even worth it. Generally, the answer is yes. Your internship provides valuable on-the-job experience and lets you build your network—plus, for many interns, it’s the ticket to a full-time Interns get job offers about 60% of the time—and more than 75% of those offers are accepted.

Meet the author

Dana Guterman

Dana Guterman is a content strategist, writer, and researcher, specializing in higher education and career development. Her clients span the business, tech, academic, and nonprofit industries. Dana graduated from Brown University, with a BA in East Asian studies, and now lives and works in Portland, Oregon.