Make no mistake, carrying a heavy course load, navigating university bureaucracy, and balancing a full or part-time job with education all take hard work and determination.
The work world is a whole different experience, however. Just as you did with your college education, planning ahead and having identifiable goals will help you avoid some of the pitfalls of life after school that many have fallen into.
Once you do accomplish securing a job and housing with affordable renters insurance, there are steps you can take to maintain yourself financially.
You Are in Charge Now
Many college grads have managed their personal life and financial matters long before graduation, but most have relied on family and others for support and guidance. Independence from home will mean managing your personal details and having the necessary materials to do so.
Keeping key paperwork in one place for reference will reduce frustrations when opening a bank account or signing up for a phone service. At a minimum, you should have on hand:
- your birth certificate
- Social Security card
- lease or title to a car, if you have one
- loan documents
- apartment lease, if renting
Keep these items in one secure place, like a safe, so that they are protected and easily accessible.
Make A Budget
As a newly employed person, drawing up a budget can give you a clear understanding of both what you have and what you need, as well as figure out how to pay for future wants and needs. Plenty of free online budgeting tools are available to help you get organized.
A good way to capture everything is to keep records and receipts of everything you spend money on in one month. Your fixed costs will be things like rent, utilities, transportation costs, loan payments, and food. Those items will give you the minimum you need each month to cover basic needs.
When budgeting, always make sure you have enough money to meet that number.
Everything else is discretionary. That includes your daily coffee, entertainment, dining out, or anything else that is not strictly a necessity to daily life. The key to remaining financially stable is not to let your discretionary spending use any part of savings for fixed spending.
Open Necessary Financial Accounts
In today’s world, it’s nearly impossible to function without a checking and savings account. Do some research to compare banking institutions for the best situation for you. Consider how you prioritize the easy availability of ATM machines, free checking, online bill payment, or low service fees. Focus on the services you need most.
Opening a credit card account can be one of the most powerful, yet dangerous tools, in your early financial management. On one hand, they supply you with necessary funds for big-ticket items, especially in an emergency.
On the other, it can be tempting to use them too much, building up needless debt. Do your best to pay the card off monthly, but under all circumstances, you must at least pay the minimum due.
Credit cards have a profound effect on your credit history. A good credit history will help you acquire loans at lower rates for a car or home in the future, as well as affect your job and housing. Making mistakes can often take years to correct.
Secure Necessary Insurance
Your main insurance issue will be healthcare. The Affordable Care Act (also known as ACA) requires every adult to have medical insurance. If your employer does not offer coverage, you will need to purchase your own. Insurance can be complex, but the US government offers advice on best practices.
You should also have insurance for possessions. Most states require cars to be insured. While you might not own a home, you still own things that can cost significant money to replace in case of a catastrophic event. Renter’s insurance can be secured for little cost, often for as little as $20 per month, and give you peace of mind in the event you lose your possessions in some way.
Save, then Save Some More
When you first graduate and have high bills and low pay, saving money can be difficult, if not impossible. Even the smallest efforts, however, can help you develop the habit of saving.
Try to build a nest egg of at least three months fixed costs in case you lose your job. It’s a hard thing to consider, but job security is never guaranteed, no matter how well you perform. Preparing for unforeseen circumstances can lessen the financial pain.
Believe it or not, you should also consider retirement savings as a new graduate. Retirement may be a long way off, but through the miracle of compound interest, a few hundred dollars a year can grow to an impressive sum over the decades. Take advantage of workplace retirement programs whenever possible, especially if your company matches your contribution. It’s basically free money!
Contributor Post at SylvianeNuccio.com