How to save money after college
There are a ton of great money tips for new college grads who are willing to do a little searching. Getting finances back into shape after graduating from college can be a very challenging endeavor to undertake. However, the question of how to save money as a new college grad is one that is difficult for many to answer per research on the matter.
As many people know, there is a looming student debt crisis in the United States. This is caused in large part due to the increasing costs of education in the country and an average wage rate that has not increased at nearly the same rate.
Surprisingly, there is more student debt in the United States today than there is credit card debt. Fortunately, there are so many things people do to get their personal financial situation in order to ensure they are in the best potential scenario to succeed. These great money tips for new college grads are listed below:
Pay off student debt as quickly as possible
Unlike many debts, student loans are rarely dischargeable, even when one has declared bankruptcy. Moreover, because of the strictness with which student loan payments are enforced, making payments on these loans should be a first priority after graduation.
Remember that choosing too aggressive of a payment plan can also be a poor choice if the payments are not affordable. Doing this can negatively impact credit rating. By choosing a reasonable payment option for student loans, one can avoid this.
Save money every month
For those graduates lucky enough to obtain a job, saving for the future is also wise. Depending on financial objectives, 5 percent of net income should be the minimum amount saved.
Savings help ensure a down payment for a home will be there when needed. They also make emergency funding more possible. For example, set aside a small amount each month and put it in a term deposit so it can accumulate interest.
Set and follow a monthly budget
Websites like Mint are great to help people learn how to save since they help establish and track a budget to ensure expenses are kept in line. Furthermore, websites such as these are gaining in popularity and are always getting better by adding new features that help optimize personal finances. It can sometimes feel like an uphill battle to try and set a budget when one's salary is so limited. However, this is the best method for staying out of debt and securing a financial future.
It is clear that managing personal finances as a recent college graduate is not an easy thing to do. There are so many expenses out there, and not too many jobs exist for paying those costs off. By following the advice in this article, one facilitates a better personal financial situation after graduating from college.