If you’re graduating college this spring, then first and foremost – CONGRATS! College is a million awesome things, but it definitely isn’t easy.
As a 2013 college graduate, I’ve been out here in “the real world” for a few years now, and I promise it’s not so bad. When I first graduated I knew next to nothing about personal finances – but, like with everything else in life, I figured things out along the way.
Hoping to help out some of you spring chickens from this year’s class, I’ve made a list of some practical tips I think every recent college grad should know.
Find time to keep learning
With your final Final Exams in the books, this is probably the last thing you want to hear. But the truth is, tons of people end up making poor money choices because they don’t know any better.
Don’t let that be you.
Not familiar with what a credit score really is or how it’s calculated? Do some research.
Any information you could possibly want to know is right at your fingertips. There are tons of great podcasts, books and blogs out there that break down everything from the basics of finances to high-level topics.
Build a budget
It’s going to feel really, really good when your first few paychecks start hitting your bank account. But before you order three pairs of sneakers or the newest smart watch, think about all the things you actually need to take care of first.
You know, like rent, food, gas, utilities, student loans, phone bills, credit card payments, etc.
That’s where your budget comes in. Whether you want to use a budgeting app, a good old-fashioned spreadsheet or OneMain's Budget Calculator, you need to find a method that works for you, and then stick to it.
It’s pretty obvious how much money you have coming in every month, but understanding and tracking all of your expenses is what will make the difference.
Tackle student debt head on
Of the 2018 class, a whopping 69% took out student loans, graduating with an average debt of $29,800.1
So, if you’ve got some student loans to handle, don’t freak out. Many of your peers are in the same boat.
Even if you have a six-month grace period before you have to start making payments, you should start chipping away at them as soon as you can. This lets you get a jump on your total balance before interest starts adding up. On top of that, you don’t want to have to rework your budget down the road when you have to start paying them.
If you’re really struggling to make your monthly payments, or if you want to lower your interest rates, refinancing your student loans could be an option.*
*OneMain Financial does not make student loans.
Plan ahead and start saving ASAP
This one’s important. Even if you’re living paycheck to paycheck, try to find a way to put away a little something from each check.
One of the top reasons you should have some savings tucked away is in case sudden expenses pop up out of nowhere. (Like car troubles or emergency trips to the vet after your dog eats a tinfoil wrapped burrito you accidentally left out.)
If you can save $20 from each paycheck, and you get paid twice a month, that adds up to almost $500 each year. Then if you put that in a savings account, or if you invest it, it can grow to even more money.
Also, if your employer offers to match a contribution into a 401(k) account, take advantage of it THE MOMENT you become eligible. Retirement might feel like a million years away, but you’re literally just turning down free money if you don’t get going on this.
I wasted a bunch of time before setting up a 401(k), because I thought I couldn’t contribute at the time. I still kick myself about it to this day when I think about all the extra dollars that could be in my retirement fund.
Take your career into your own hands
When it comes to your career, sometimes you’ve gotta risk it to get the biscuit. And this might sound crazy, but the highest paying job you can land right out of school isn’t always the best job to take.
Above all else, you need to find a job that you enjoy and that has solid career growth potential. Once you’ve got that dream job in mind, it’s on you to start taking steps towards that goal.
You might have to move across the country to get into the right field. You might have to message some strangers on LinkedIn or call your dad’s best friend’s cousin to get your foot in the door at some awesome company.
It might be scary or a bit uncomfortable. But who cares? It’ll be worth it in the end if you can land a job that makes you happy.
Treat yo’self! (In moderation)
You should never, ever be reckless with your money, but it’s important to have some fun and take care of Numero Uno sometimes. Life’s all about balance after all.
So give yourself a savings goal each month. When you hit it, make it a little higher the next month. And the month after that. Then eventually, go ahead and reward yourself with something that’s important to you.
You can always save more money, but your best friend will (hopefully) only have one bachelor party. Don’t be the guy who misses it because you forgot to plan ahead and save up enough money for a plane ticket.
Go take over the world
Time is priceless. And you’ve got a whole lot of that on your side.
If you make the effort to stay on top of your finances every step of your journey, you’ll set yourself up for a future full of success. Good luck out there — you got this!