How to Finance Life After College - CareerAlley

How to Finance Life After College - CareerAlley We may receive compensation when you click on links to products from our partners. As a recent graduate or young professional, theres one thing you likely have in common with your competition: student debt. In fact,70% of college studentsgraduate with student loans that total an average of about $37,172 thats owed. However, between working to perfect your resume, gain the right experience and pay off your student loans, its also important to get a handle on proper finance skills that willhelp propel you to successand make life easier. Between working to perfect your resume, gain the right experience and pay off your student loans, its also important to get a handle on proper finance skills that willhelp propel you to successand make life easier. Tweet This source Pencil Out a Budget Now Here it is helpful to use a common financial planning method. If you were going to plan out your savings for a year in order to reach a specific goal, you would begin by writing out short-term goals that you would like to accomplish andanalyze the cost of achieving each goal. You can use this same strategy in planning out your first year out of college. Ensure you are taking into account even the tiniest of expenses. Once you have a good grasp of the numbers needed in every area of your research, you can effectively plan and allocate a budget accordingly. source Avoid Taking on More Risk As you likely might still bepaying off various types of student funding or other forms of debt, it is important not to take on further risk. Effectively plan out how you will use your current savings to ensure that you dont have to assume any more debt in order to fund an area of your lifestyle. The overall goal is todecrease your debt-to-income ratioto ensure you are set up for even more financial success as you move into the next stage of your career, and you can accomplish this by applying the 50-30-20 rule. Using this method, youll put 50% of your income towards necessities, 20% towards financial goals and 30% towards things you want. source Learn the Basics of Investing As you begin to reduce your debt and increase your savings throughout your early career, learning how to invest your money will help you save for rainy days and other larger investment opportunities. Familiarize yourself with the difference between mutual and index funds and try downloading a robo-investing app that will help you invest in a low-risk, automated way in order to begin crafting a well-rounded investment portfolio. Most people wont invest because theyre afraid theyll lose their investment. Weve all lived through dramatic market crashes. As a result, there is nothing we get asked more than Is now the best time to invest or should I wait?. Just like everyone else, we cant predict the future. Learn how to invest your money Take it One Step at a Time Life as a recent graduate doesnt have to be as scary as some people make it out to be. Learning how to properly budget your savings during this time period will help you gain a handle on your finances until youre making enough money to do other things like pay off student loans and invest in unique opportunities that enhance your professional and personal life. Budgeting: How to Make a Budget and Manage Your Money and Personal Finances Like a Pro Price: $3.99 budgeting and finance book Buy Now from Amazon We earn a commission if you click this link and make a purchase at no additional cost to you. Last Updated: February 28, 2020 What's next? Ready to take action? Choose the right tools to help you build your career. Looking for related topics? Find out how to find the opportunities that help you grow your best career. Subscribe and make meaningful progress on your career. It’s about time you focused on your career. Get Educated Contact Us Advertise Copyright 2020 CareerAlley. All Rights Reserved. Privacy Policy + Disclosure home popular resources subscribe search