Money College: My perilous life as an unpaid intern

college intern"Uh, sir? I'm sorry, but your card has been declined."

It's a phrase I've grown all too familiar with. This time, I'm in 7-Eleven, and I've just suffered the indignity of having my debit card turned down over the purchase of a 99-cent Slim Jim beef stick. My brain pleads for me to walk away, mutter something about the unreliability of modern banking institutions and save a shred of dignity. My stomach, however, gurgles a warning that things are about to get worse.

I realize how hungry I am, and, bolstered by the certainty that my fridge contains nothing but Miller High Life and condiments, I grab one of the meager 25-cent rods of beef cowering next to my original foot-long prize. "Can you try it with this one?" I ask.

A second swipe of the card, and an agonizing pause.

"Um, OK. That worked."
At this point, I've acquired some meager mystery-meat sustenance, but at what cost? I've just broadcast to the chagrined clerk and the four customers in line behind me the sad fact that my bank account contains less than the price of a processed convenience-store snack. The punk-rock couple to my left snickers softly at my misadventure.

Welcome to my life as an unpaid intern.

Two jobs, little money

Beginning in the fall of 2008, I undertook two separate unpaid internships during my senior year in journalism school at Loyola University Chicago. The first, a reporting internship with the Chicago Tribune, counted toward a J-school curriculum requirement and earned me three college credits.

The second, a public relations gig at local Chicago record label Minty Fresh (during which the Slim Jim incident occurred), I simply piled onto a full-time course load and a part-time coffee shop job for no immediate incentive whatsoever.

My editor at Money College asked me to write a short piece about the experience, and posed this question: "How did you manage to juggle work, school and two internships and still manage to feed yourself?"

The thing is that -- as the above anecdote should indicate -- sometimes, I didn't.

I don't regret for a moment any of the financial discomfort I went through to get through that year, and I still firmly believe that every college student owes themselves the exhilarating experience of a good internship with passionate professionals. However, the reality is that most internships don't offer any monetary compensation, and good internships tend to eat time -- more time than almost any comparable college class, and time you could be spending, you know, actually getting paid for your labor. So, how does a young, hungry intern begin to cope with this crunch?

I can tell you that by the time I began working as an intern, I had already developed spending habits that put me well beyond my modest means. After running up a few thousand dollars in credit card debt, I cut up my plastic and decided to simply live within my monthly income, adopting the simple Zen-like mantra "more credits than debits" as my new financial credo. However, as I found out shortly after I finished congratulating myself for this ascetic display of fiscal discipline, this didn't even begin to address the depth of my budgetary bad habits.

Throughout my tenure as an unpaid intern, I lived paycheck to paycheck, and the term "lived" runs the risk of sugarcoating the crippling spells of Steinbeck-ian poverty that often beset me toward the last few days before my next check. Like many people who struggle to manage their finances, I found it incredibly hard to break myself of the habit of spending far too much as soon as I got paid.

When the money inevitably ran out, I mooched from friends, scoured the laundry room floor for moldy quarters and pawned my iPod so many times that the pawn shop began saving and re-using the paperwork.

A few tips
I never starved, but I ate some pretty embarrassing meals. (Hot dogs on Wonder bread, anyone?) It wasn't fun, but I lived it down -- and by the end of that era, I had figured out a few basic tips that might prevent future generations of interns from suffering my financial fate.

First, I learned that budgeting is everything when you take an unpaid internship. If you want to avoid the self-perpetuating bi-weekly cycle of boom and bust that accompanied my pay periods at work, you need to make up a budget that covers all of your basics first: rent, groceries, utilities.

A realistic budget needs to include all of the contingencies and financial foibles you might come across in a month -- if you unexpectedly run out of deodorant and body wash on an intern's minimum-wage income, then you've likely offered yourself the unfortunate choice between a few skipped meals and a week of 17th-century European hygiene.

I'd suggest using a personal finance site like mint.com to make up a budget for each cycle of your income, and then stick to it like it's your lifeline. The software will help you create a reasonable budget and track and itemize your purchases as they chip into it. Once your budget for entertainment is gone, then you need the discipline to conscript yourself to an evening at home when your best friends start planning an epic Saturday night in the city -- a discipline I often didn't exercise.

If you don't, then prepare to get resourceful. I personally mastered a little game I affectionately dubbed "checking account chicken." The object of the game (so named because as you play, you can see the headlights of fiscal doom bearing down on you), is to use the lag time between the posting of debit card transactions (run as credit) to spend more money than you actually have.

By the end of my second internship, I was a near-virtuoso at checking account chicken. I could turn $10 into $50 for a few days, and I knew exactly how long almost every major retailer took to post debit card transactions (two days at CVS pharmacy, a whopping five at certain Walgreens).

Of course, I also lost my fair share of "games," and paid a couple hundred dollars in overdraft fees along the way. I'm sure any qualified financial planner would have a field day disparaging my little pecuniary pastimes, and in retrospect, I agree.

Besides that, many banks have begun changing their transaction posting procedures so you can't do this. I'm simply describing my black-belt mastery of this odious practice to convey the kind of monetary gymnastics you can force yourself into if you don't stick to your budget.

I also eventually figured out that it pays to hang around people who share similar resources. When I started interning, I ran with a group of friends who had all graduated college and acquired jobs that they were beginning to consider as potential careers. While they weren't raking down six-figure incomes, I still couldn't compete with their spending power on a part-time barista's wage and an intern's salary of harmonious self-satisfaction.

Even so, I still accompanied my friends on dinners and drinking binges that were liable to bankrupt me in a single fateful swipe of that debit card, all in the spirit of camaraderie. Eventually, I started to feel like the butt of a bad joke: "A real estate accounts executive, a trial lawyer and a journalism intern walk into a bar. Who's coming out broke?"

Toward the end of my senior year, though, I began dating a classmate at Loyola and spending more time with her friends, all of whom attended the university and worked part-time positions for spending cash. Usually, we just lounged at someone's apartment or went to a local house party, content to make our own fun with whatever hijinks we hit upon that night.

Suddenly, my financial situation seemed far less dire, as I could go days or even weeks without spending any money on my social life. If I had spent more time getting to know my classmates all along, it occurs to me now, I might have avoided so much financial distress.

Finally, my parting advice to all you unpaid interns is this: just accept the uncertainty of your position for now. There's a certain serene confidence you gain when you simply make up your mind that you're going to spend a few lean months in the service of something greater.

You might not turn your internship into a full-time position upon graduation, no matter how hard you work, and you probably won't fall into fabulous wealth along the way, either. But from my own experiences, I know you can proceed with this knowledge at least: if you can make it as an unpaid intern with a bit of grace, you're ready for anything.

Steven Kent, having survived his two free internships, now actually gets paid to write for the Money College section of WalletPop.com, though he has not earned the free beef jerky perk. Not yet, anyway.

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