At a Glance:
- You graduated college—congratulations! now what?
- Talking about money is not always easy, but it is often necessary.
- Creating healthy financial habits early can help set you up for long-term success.
Greetings to you, graduate! You’ve studied hard, finished your exams, and now you’ve got your diploma.
Now that you have your degree, you’ll likely enter the workforce or start graduate school. Or maybe you’ll take a different route. But no matter what you do, you must learn how to set yourself up for financial success. but how?
A good first step is to talk to someone you trust about money. Unfortunately, because the topic often makes us uncomfortable, we try to avoid it. But the reality is that the sooner you educate yourself, the sooner you’ll be on your way to financial success. So where should you start? Since many recent college grads have student loan debt, planning how you’ll pay it off is a great place to start.
have a plan for how you will pay off any debt Important, and student loans are no different. The sooner you pay them off, the less interest you’ll pay over time. One way to reduce the principal amount and the time it takes to pay off the loan is to pay more each month. Now paying more on the principal means paying less overall. And if you have more than one loan, consider paying off the loans with the highest interest rates first to reduce the overall interest you pay.
Budgeting is a great way to keep track of the money you earn and the money you spend. Creating a plan for how you will save and spend your money based on your monthly income and expenses can help you live within your means. Make goals for how much you’ll spend on expenses like rent, food, entertainment, clothing and transportation—then try to stick to them. If you don’t get it right the first time, don’t worry—you may need to make adjustments to find what’s best for you. and since savings and investment While essential to your financial well-being, your budget should include both.
saving for retirement and more
Although retirement may seem light years away, it is never too early to start planning for it.
Be sure to participate in your employer’s retirement plan, if one is offered. If you don’t have retirement plan benefits, you still have options, such as a traditional or Roth IRA. Save 12-15% of your gross (before tax) annual income, or work toward savings, which include any employer contributions (meaning they match a certain percentage of the money you invest) Will eat—it’s like free money!). It is also important to save emergency situation Like an unexpected car repair or medical bill. You’ll want to keep your emergency funds in an easily accessible account such as a taxable account or a Roth IRA.
Congratulations on getting to this next step of setting yourself up for success. Establishing healthy financial habits may seem overwhelming at first, but it’s worth it in the long run. Your future self will thank you!
“Top Investment Tips for College Graduates”,