If you’re among the thousands of college students graduating this year, congrats! It’s an exciting time, but it can also be daunting when it comes to your finances. Between student loan debt and entry-level salaries, it’s natural to feel like the money deck is stacked against you.
The good news? You have time on your side. Use it to your advantage with these 13 essential financial tips for new college grads.
Master Your Mindset
- Make the leap. It’s tempting to think you have to figure out your career and finances right away, but this is the time to take risks and make mistakes. It’s through failure that you’ll learn and grow, so don’t be afraid to switch careers or move to find better job prospects.
- Be proactive. Handing out resumes and waiting on the sidelines may not land you your ideal job. Instead, seek out mentors who can help you or go to networking events and meet as many people as possible. Most opportunities come from personal connections.
- Find your group. Too many financial tips for college graduates fail to mention how important it is to surround yourself with likeminded people. Not only find people who are ambitious, but ones that are willing to talk about money.
- Learn to relax as hard as you work. Getting burned out can affect your health and your finances in the form of poor job performance and medical bills. Your energy isn’t infinite, so take breaks, meditate, hang out with friends – it will do wonders for your mind and your wallet.
Money 101 for College Grads
- Learn the pros and cons of consolidating or refinancing your student loans. If you’re paying a high interest rate on your loans, you could save a lot of money by refinancing them at a lower rate. Before making a decision, find out how much you actually owe and your current interest rates via the Federal Student Loan Website. Afterwards, do a search to find student loan refinance rates. We’re talking about a potential difference of thousands of dollars.
- Reduce your largest expenses. This is one of the best budgeting tips for college graduates. If you do nothing else, figure out how to lower your costs on housing, commuting and eating. It could mean renting a smaller apartment or not dining out as much. As for commuting, see if you can carpool, take public transportation or even bike to work.
- Track your spending. You won’t know what expenses you can cut until you understand what it is you’re spending money on. There are many budgeting apps that link up to your credit and debit cards so it’s all automated.
- Create a realistic budget. Having a spending plan will help you keep from getting into debt and stay afloat. Once you track your spending, find out what you can cut out and how to allocate your salary accordingly.
- Take advantage of employee programs. Did you know that your employer provides free stuff and discounts just for working there? A great way to find out is through your HR department, employee handbook or by asking your coworkers. Things you can save on include gym memberships, cell phone bills and even travel.
Look Towards the Future
- Commit to building your credit history. A good credit score is essential because it can help you rent an apartment, open a credit card and even in some cases, land your dream job. You want to find a place that can regularly reports to credit bureaus, like with a personal loan from RISE.
- Start investing. Investing for the first time can sound intimidating, but it doesn’t need to be complicated. Take a few minutes each day to learn something about IRAs, ETFs and investing apps, pick a place and put some money (even a small amount) there every month.
- Match your 401k. If your employer offers a 401(k) plan, take advantage of it. Your employer typically matches about 3-6% of your pay, so you’re essentially leave free money on the table if you don’t.
- Keep learning. If you really want to better your financial future, building more skills is important. It could be the difference between a higher paycheck and a stagnating salary. Acquiring new skills doesn’t have to be expensive either: there are many free resources and classes. You can even borrow books from the library. Set a goal to learn one new skill each month and don’t look back.
In addition to these money tips for new college grads, RISE is here to help! As you embark on your financial journey, find out how a RISE personal loan can help you build credit for the future, and check out our free, interactive tools for setting savings goals and managing debt.