My Story: Budgeting for an Unpaid Internship

By Theo Keith, College Connect blogger

Many companies have responded to the economic downturn by eliminating jobs, slashing salaries, and terminating paid internships. For students, this means getting paid to learn job skills in a real-world environment isn’t the norm anymore.

For example, most internships in my chosen field of TV journalism are unpaid. The network TV internships are all in New York City, too—not exactly the place to be when you’re looking to save money. I knew if I wanted to gain meaningful experience in the industry, I’d have to take an unpaid internship and swallow the accompanying hit to my savings account.

But there were ways I could cut down on costs and minimize the financial toll of accepting an unpaid internship in New York City.

Build a Budget

First, I took an hour or two to develop a budget before I left for my summer internship. Here are a few ways I budgeted to save:

• I looked up the cost of subway passes and estimated taxi costs to and from the airport. Then I created a transportation section in my budget and committed to taking the subway or walking whenever possible.
• I budgeted separately for: lunches out three times a week with other interns from work, dinners out once a week, and $50 per week on groceries.
• I also created categories for sightseeing; a weekend trip to Washington, D.C.; and miscellaneous spending on haircuts and other things.

Stick to the Plan

Next, I stuck to my plan throughout the entire summer. Every time I went to the grocery store or considered grabbing dinner out instead of pulling a frozen dinner from my freezer, I thought about my budget. And, in the end, I saved a lot of money.

I shaved off nearly $700 of my original $2,200 budget for the summer. That combined with the $10 per day intern stipend I got from work made the skills I learned in the internship even more valuable, because I didn’t spend too much money to learn them.

Consider Other Internship Options

This type of spending plan isn’t for everyone. I’ve always been a saver, so I was OK with the idea of spending $2,000 in New York for the summer. I also looked at the bigger picture: The things I’d learn at the internship were worth more than $2,000 in up-front costs, so I considered it an investment.

If you don’t have the money to fund an unpaid internship in a big city, though, there are other options:

• Take an unpaid internship in a city where the cost of living is lower.
• Pursue an internship in the city where your parents or other relatives live, and live with them for the summer.
• Ask your parents to help pay for the summer and then offer to pay them back when you return to school and start working at your part-time job.
• Only pursue paid internships, keeping in mind your options may be limited and you may have to spend more time and energy to find them.