With graduation season upon us, it is essential to start your financial journey off on the right track after graduating from college. The money decisions you make on campus are much different than the choices you’ll make once you enter the real world. How and when you spend your money can alter certain career plans and goals if you’re not careful.
Setting aside time to plan your financial progress can help you stay on track with certain short and long term ambitions. This is especially important during these unprecedented times, now is a good time to evaluate your finances and look for budget friendly ways to improve your financial wellbeing. Consider these helpful tips to get a stronger handle on your money for a prosperous life after college.
Build your budgeting strategy
Graduating from college comes along with a variety of mandatory monthly payments. These could include a car payment, student loans, rent or travel costs. With so many payments coming out of your checking at once, it can be difficult to budget if you don’t have an organized system in place. To successfully manage a budget, add up your monthly paychecks, track your spending and always look for items you can eliminate from your expenses.
Take care of your student debt
It is crucial to take care of your student loans on time to avoid unnecessary fees. The longer you wait to set up your student loan payments, the more late fees you’ll receive. Depending on your current income, research all of your payment options to determine which one is right for you and your budget. Along with this, look into refinancing your student loans to reduce the total amount you end up paying. By refinancing, you can also secure a lower interest rate and be given a financial progress report depending on your current salary.
Open up an emergency fund
Throughout your adult life, you’re bound to have some bumps in the road, such as a car repair or a medical cost. Opening and contributing to a savings account every month will make it easier for you to pay off those unexpected expenses. Even if it’s as little as $20 a month, you’re contributing to an account that will act as a cushion, rather than accumulating more debt when a financial disaster happens.
Open a credit card
As soon as you graduate from college, the credit card letters will begin to appear in your mailbox. You may think of this as an annoying occurrence, but opening a credit card account after graduation is not a bad idea at all. Establishing credit after graduation benefits your financial health in a variety of ways. Building up your credit can give you a better rate for your car loan or mortgage. You’ll quickly learn how to spend within your means, and by hiring a credit advisor, you can receive additional guidance and information about your credit options.
Cut out additional costs
In college, you may have been paying for a Netflix account, a Birchbox subscription or Amazon Prime. They all require a monthly payment, but it might not be a payment that’s necessary for your post-grad lifestyle. If not, make sure to eliminate anything that is unnecessarily taking money out of your bank account. You’ll be surprised at how much money it will save you.