Post-college Finances: Where to Next?
Finishing college can feel like a huge relief, but at the same time, it’s frightening. On the one hand, you can start earning some proper money. On the other, there’s always the worry you won’t find a job, and you now have a lot of debt. Assuming you are able to find a job, it won’t make your money worries go away. You have to pay for college, plus fund your postgraduate lifestyle. The best way to get your finances in order is to start dealing with them right away. As soon as you’ve secured yourself a job, make sure you do these things.
Working Out Your Priorities
First, you need to decide what your financial priorities are. Some people will want to knuckle down and save some serious money. To do this, you might have to limit doing a lot of things, including traveling and going out. Other people might want to save a bit, but they’re more interested in spending their money on vacations or new things for their home. If you’re reading this, you’re probably more like the first option. However, you might feel like you’re somewhere in the middle. You have financial goals, but you don’t want to live a dull life. So are your priorities saving for a home, getting started on your retirement fund, or clearing your student debt?
Dealing with Debt
Before you can do anything else with your finances, there’s no point ignoring the elephant in the room. You likely have at least some debt from college to cover your tuition. However, some people have more debt than others. Were you seduced by those awesome credit card offers in your freshman year, perhaps? Now they don’t seem such a good deal. If you want to tackle debt, you need to work out what solutions are available. For student debt, look into consolidating your debts or even a loan forgiveness plan. For credit cards, try services like A New You and their debt reduction plan. These solutions can help to make your debt more manageable, even if you can’t reduce it.
Creating a Budget
A post-college budget is essential. Hopefully, you learned how to budget well in college. However, if you didn’t, now is the time to start. You need to begin by writing down your essential expenses, such as your rent and bills. Then consider how much you want to save for different purposes and how much you’re willing to spend on fun things. If you want to reduce your expenses, you can almost always find techniques to do it. Even your rent can be reduced if you’re able to move.
Start Saving for Retirement
It’s never too early to start saving for retirement. In fact, the earlier you begin, the better. So make sure you familiarize yourself with your saving and investment options. Work out which one is best for you, and even if you should have more than one plan.
Your 20s are excellent years for setting up financial security. You might have college debt, but don’t let it rule your finances completely.