Top 5 Financial Concerns Facing College Seniors
The class of 2008-2010 entered college during a time when the economy was experiencing the greatest economic downturn since the “Great Depression.” Never before in the history of our modern economic society have issues of personal finances (i.e., mortgages, personal loans, credit card, etc.) has largely been a main concern for many American individuals and households, marking a turning point of sort when millions of American families has learned the vices of their own personal financial calamities. Perhaps college seniors, many of whom are graduating and will be confronted with the financial dilemma of whether to enter the job market or return to graduate school, should discern these top 5 financial concerns in order to get ahead of the pack:
#5 Alter your student loan payments…
Your first order of business is perhaps the most critical in regards to money and budgeting—namely, lowering your monthly payments should be of very high priority, as this will vastly reduce your monthly expenses. You can accomplish this simply by logging on to your loan service and discerning whether or not you’re on a 10-year payment plan, which appears to be the standard for most loans guaranteed by the government. If you’re unable to manage your payments that way, don’t worry, there are alternatives: HelpSaveMyDollars.com is a website that helps students and their families learn about money. Cautionary tales abound: the longer you extend payments, the more interest you pay.
#4 Check your credit report for errors…
While in college, basic essentials like food, water and shelter doesn’t necessarily scream high priority, as these resources come fully covered under students' tuition. Life beyond college, in stark contrast, presents a different kind of financial challenge, whereby procuring things like apartments, utilities, bank accounts, insurance and even employment will require a thorough review of ones personal credit files. Headed by the big three credit reporting agencies, (Equifax, Experian and Transunion) landlords, employers, banks and insurance companies will indeed pull your credit at any given notice. Their reason: most businesses and organizations pull credit to learn how financially responsible you've been. Given the gravity of the situation, convential wisdom mandates that every newly minted college graduate should check his or her credit report for possible errors; therefore, you'll be able to dispute them off as quickly as possible. For those financial savvy graduates, looking to get ahead of the rest, downloading your reports for free once a year from AnnualCreditReport.com becomes a moral imperative.
#3 Get your own credit cards…
Now that you’ve officially graduated, it’s now time to man-up or woman-up to your own personal finances. The good ole days where mom and day carried you on their finances are indeed over with. If you find that your credit scores aren’t high enough to qualify for a prime "unsecured credit card", then the best order of advice most credit experts recommend would be to apply for a secured credit card. They’re fairly easy to get approved for, especially since your initial deposit will be used as collateral to cover the card’s balance. For a compete list of secured credit cards, a great site to visit is nerdwallet.com.
#2 Just charge it…
Although trivial as it may seem, a lot of college grads forget to actually use their credit cards. Why should you use it? It’s simple: in order to establish good credit and a good FICO score, FICO recommend you make on time payments for at least two years. The key feature is to remember to not only used the card, but the moment you receive your bill, pay it all off in full. Good credit score rule of thumb #1: “If you can't afford it in cash, you can't afford it.” Remember the idea here isn’t to get into debt, but to build the kind of credit that’s needed to sustain a high standard of living for you and your future family.
#1 Save, save and save again…
The importance of savings can’t be overly expressed. To put it in more concrete terms, many college seniors will be vastly unprepared for what lies ahead in regards to ‘real world’ financial concerns. The landlord doesn’t want to be your college buddy: he or she wants money for apartment deposits—end of story. In addition, you’ll need cash for utilities, food and quite possibly moving expenses. These things, along with a host of other miscellaneous expenses can be paid for with your savings, which should act as a nice cushion. The advantage of putting away monies today is not having to worry about carrying debt tomorrow.
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