Smart Ways College Grads Handle Money 

After four years of academic life, it can be challenging to deal with everyday financial responsibilities. If you have recently completed a four year degree and want to take on the challenge of developing monthly budgets, refinancing school debt, setting aside money for retirement, purchasing life insurance, saving on a regular basis, and improving your credit score, now is the time to get busy. Figuring out how to pay bills, save, and manage personal finances can seem daunting at first, but by approaching the process gradually, young adults of many backgrounds can get a better handle on their life’s major issues. Review the following points and see which ones best serve your needs. 

Make a First Job Budget 

The monthly budget is the centerpiece of a working person’s life. That’s why it’s imperative to get the details right. Begin by listing your regular sources of income along with amounts. This is usually a very short list that includes nothing more than income from a job. Then, do the same for expenses. Include all categories of spending, remembering to include rent, car payments, etc. Be careful to tally everything you spend on dining out, recreation, fuel, groceries, insurance, student loans, and more. If your income covers the expenses, allot the overage to a savings account. There’s more to budgeting than that but get started with the basic method first. Follow the plan for three months before making any major adjustments. 

Refinance Student Loans 

A surefire way to get your after-college budget in order is to refinance one or more of the education loans on which you’re still making payments. Learning how to refinance student loans doesn’t take a degree in higher mathematics. Instead, all you need is to review a complete guide on the subject. That way, it’s easy to discover how to reduce monthly payments by getting a new agreement that comes with more favorable terms. Whether you have one loan or several, a refi is a powerful way to take advantage of a process that many have already used to reduce their monthly expenses. 

Open an IRA & Savings Account 

Attempt to adjust expenses so that you can save 5% of your income in a separate account. If you live alone and work full-time, this amount of savings can suffice for the time being. Note that some young adults struggle to save any money at all, so don’t be overly concerned if you can’t reach the 5% goal right away. Open a separate IRA (individual retirement account) and contribute to it regularly, even if the amount is small. The goal of this exercise is to create a retirement account and get into the habit of placing funds into it with regularity. Later, you can increase what you place in IRAs and savings accounts. 

Work on Your Credit Score 

As soon as you receive a diploma, get educated about credit scores and how they work. There are three major bureaus, Experian, TransUnion, and Equifax. They have their own evaluation systems but generally generate similar scores for individuals based on dozens of factors. New grads typically have lower scores or no listing at all. The way to remedy the situation is establishing a payment history as quickly as possible. How? Sign up for a secured credit card through a reputable financial institution or an issuer you trust. Search for cards that come with low opening balances, reasonable fees, and other desirable features. Make regular charges but repay the entire amount when you receive the monthly bill. After six months or so, all three bureaus will pick up your data and include it on their listings. Before getting a card, be sure that the company issuing it reports to all the bureaus.