Did you know that about 18% of college students graduate every year? That equals almost 4,000,000 people potentially entering the working world.
Whether you just recently got your first “big kid” job or you’re interested in creating a plan for after graduation, knowing how to budget and pay attention to your personal finances is extremely valuable.
As young professionals, it’s extremely important to know how to start your financial future off on the right foot.
Keep reading to learn the basics that will help you get started with money management.
Stick to Your Budget
After creating a budget based on your income versus regular costs, you have to pay attention to your spending. It’s easy to make a budget, but it’s a lot harder to follow it (especially if you haven’t had to do it before).
Many people find that general bills, like utilities, rent, or even groceries, cost more than they thought if it’s their first time footing the bill. Because of that, you need to make sure that you account for all expenses you have, including creating an entertainment or “fun” budget so that you don’t overspend on hobbies.
Making more money every year is a great thing for young adults that haven’t had full-time jobs before, but managing that money is more important when you have more money to work with.
Think About Your Future Goals
After you’ve had success with your budget, it’s important to think about what you want your financial future to look like. Using investing apps to take a look at how you can potentially benefit from investment opportunities is a good place to start.
You should definitely be setting aside at least 10% of your overall income every month and putting it into a savings account that will generate interest.
You also will want to start looking into what retirement options are available to you, either through your employer or independently. It’s never too early to start saving for retirement. Check out fortitudefg.com to get some help with this process.
Consider All Options for Accounts
There are many different banks available to you for your checking and savings accounts, so you have to do your homework to find the ones that are going to benefit you most. The best bank for you as a college student may not be the best bank for you as a young professional.
Consider what types of incentives will work best for you and your lifestyle, but also pay attention to interest rates since these will be extremely useful in the long run.
Pay Off Your Debts Fast
Most people out of college have some type of debt, whether it’s from a car loan or student loans. However, you will want to work hard after school to pay those debts off as soon as you can. Otherwise, you’re going to end up paying a lot more in compound interest over time and won’t be as financially strong.
Remember that credit cards are great to build up your credit, but they should not be abused. Don’t spend more than you actually have and always pay your monthly balance in full whenever possible.
Young Professionals Can Have Strong Personal Finance
If you’re one of the many young professionals out there that is just starting out in the working world, congratulations! It’s an exciting time and gives you a great opportunity to build a strong financial future.
Be sure to pay close attention to your spending habits, research your banking options, and pay off your debts as soon as you can.
Did you find this helpful information? If so, you may want to check out some of the Business and Finance posts on the blog today!