Graduation is often one of the major turning points in many people’s lives. It’s an opportunity to celebrate the fruits of all your hard work over the last few years. It can also be a time to start looking for the job of your dreams, so you can begin building an amazing career. Unfortunately, there are challenges to face when you leave college. Many college graduates say the number one gift they’d like to receive following education is financial assistance. Although students often learn how to make deals with limited cash during their college years, they can feel unprepared when it’s time to branch out on their own. If you’re looking forward to graduation, or you’ve recently graduated and you need some financial guidance, here are some steps you can take to get yourself on track.
Review Your Budget
First, you need a solid idea of where you actually stand right now. With your education over, are you going to be moving back home with your parents so you can save cash for a while as you save up for a place of your own? Are you going to continue to live with roommates? What are your outgoing expenses going to look like each month, and how do they compare to how much you’re earning from any jobs or apprenticeships you have? Many expenses and life requirements can change after graduation. It’s important to understand exactly how much money you’re going to be spending and earning moving forward, so you can determine how much you can afford to pay towards student loans, and how much you can save for the future.
Know Your Options
You’ve already taken the first step in investing in your future by getting your degree. Now it’s time to think about what comes next. If you have an opportunity to work in a job that’s going to pay lower than you’d like initially, can you reduce your expenses to make the role more manageable and gain experience? If you need to travel to find more job opportunities, is it a good idea to buy a new car? Purchasing a car or renting a house immediately after college can seem overwhelming, but sometimes you do need to invest in yourself if you want to leverage your new degree correctly. If you can’t afford to buy what you need outright, think about the kind of lending options you have. A personal loan from a private lender could help you to avoid paying sky-high interest rates and maximize your monthly budget.
Open a Savings Account
With so many bills to think about, student loans to consider, and a future to invest in, it can be difficult to find any cash remaining for savings. However, opening a savings account could be the key to reaching your future goals. As soon as you start a new job, open a savings account where you can put a small portion of your wages away each month. The key to success is to commit to only putting enough away that you’re not going to be left without enough cash to look after yourself. Having your money in a separate account can reduce the risk of you spending it on things that you don’t really want or need. You can also set up automatic direct debits to a separate account, which means you can essentially forget about having to spend the money each month.
Review Your Credit Report
When you’re fresh out of college, you might not be thinking much about your credit score and what it’s going to mean to you in the future. However, the reality is that your credit report can make or break your chances of getting excellent deals later in life. If you want to get a favorable loan agreement on your next car or a great mortgage, you need a solid credit score. Don’t think that just because your student loan is your only loan, your credit score will automatically be excellent. Sometimes, a lack of activity on your credit report can be just as bad as too much. If your credit score isn’t ideal, you’ll want to start building it as quickly as possible. It can take quite some time to get your number to a good level.
Set Clear Financial Goals
Sometimes, following a budget and achieving your financial targets can be a harder nut to crack than others. When you’re facing the challenges of having enough money to pay your bills and have fun with friends, it’s easy to start feeling down about your financial situation. The best thing you can do when this happens is finding a way to motivate yourself. Setting clear goals is a fantastic way to keep yourself focused on the future you want to achieve. Your goals will help you to maintain your motivation, no matter how challenging your path can feel at times. Set your goals and stick by them.
Taking charge of your own finances is the first step towards an independent life. Be it a tiny amount, but the start is all that matters. Do share in the comment box what were your financial steps right after college.