- May 25, 2021
Congrats grad! You’ve earned your degree and now you’re on your way to start a whole new journey in adulthood. Exciting? Of course! But, before anything else, you should set a solid foundation for this next step in your life. And that starts with becoming financially stable. Here are six tips to get you started.
1. SAVE!
Yes, it may sound like common sense, but saving part of one's income can be difficult without discipline and a plan. As a college student, you may have had a head start on this thanks to part-time jobs or paid internships. If you don’t have one already, open a savings account at a credible bank. As a general rule of thumb, you should have at least 3 to 6 months of your monthly income set aside at all times as an emergency fund. This can alleviate some stress in the event of unforeseen events or circumstances.
2. Make Budgeting Part of Your Lifestyle
Now that you have your newly found independence, being responsible for your finances is crucial. A budget will look different for everyone depending on their lifestyle. When creating your budget, decide on how much you will save and stick to this. Make a point to record all your sources of income and how much you spend each month to keep track of where your money is going and where you need to cut back.
3. Try Your Hand at Investing
Making your money work for you is perhaps the best financial decision you can make. Although it may seem daunting, investing in the stock market will be a game-changer in building your finances. If you do choose to go this route, be sure to have an experienced financial advisor to guide you along the way.
4. Set Financial Goals Early
You probably have several personal and career goals that you are working towards. The same ought to be true when it comes to your money. These goals, both long and short term, should be realistic and achievable. Take time to think about what you want your finances to look like at different stages of your life and make the best strides towards getting to that point. Ideally, you should set these goals as early as possible because building your wealth will take time.
5. Avoid Unnecessary Loans or Debt
It may be tempting to go after as much independence as you can. This may mean getting your own car, or home, etc. Even though it is a good thing to get a head start on these things, you want to make sure that you are spending within your means. Unless it is absolutely necessary, avoid getting loans for large sums of money before your wealth ever has a chance to build up, especially if you have other financial commitments. This will help you to live as debt-free as possible.
6. Be Consistent
You’ve probably heard the phrase ‘consistency is key’ a few times in your life. Although it may sound like a cliché, it really is the key to your financial success. Earning an income, budgeting, investing all require consistency. Gaining and growing your finances is only achieved through a conscious decision to actively work towards your goals. So, even though it may take time, keep at it until you are satisfied with where you are financially.
Written by Jade Bethel, RF Administrative Assistant