Congratulations! You graduated from college and landed your first job! It’s an exciting and scary new chapter all rolled in one. You’ll be making some serious money for the first time in your life, but you’ll also be responsible for some serious adult bills.
Before you sign a lease for an apartment or purchase a new car, avoid the most common money mistakes made by college graduates. We have assembled a list of blunders to steer you towards a financially fit future.
1. No Emergency Fund
In this next phase of your life, it’s essential to save money, specifically for emergencies. When you least expect it, your car may need a repair, you need expensive dental work, or you perhaps get laid off from your job.
2. No Monthly Budget
Chances are you were living on a meager financial diet at college, where students find frugal ways to get by. Now that you’re living a more independent life, you need to have a budget and keep your spending in control.
3. Living Beyond Your Means
Living beyond your means is overspending. When you strike out on your own, you may find your newfound freedom is costly. Put the brakes on large or repeated impulsive spending. Living beyond your income is a recipe for financial disaster.
4. Getting Rid of Your Roommate
After graduating college, the last thing you may be thinking about is living with a roommate again. However, your housing costs are going to be a significant portion of your budget. Are you ready to hand over most of your hard-earned paycheck to your landlord?
5. No Student Loan Repayment Plan
One of your most considerable new responsibilities will be to make regular student loan payments. Don’t put off paying these loans or extending the time further into the future. Go for the standard repayment plan with equal monthly payments up to ten years..
6. Ignoring Company Freebies
What’s in your company goodie bag? Many answers to your financial future are in your benefits package, yet some don’t look close enough. There are different types of company benefits that add meaningfully to your compensation.