How College Graduates Dominate their Money & Finances

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You finally did it, after all the sleepless nights from studying and writing papers, all the time you spent in the library with your nose stuck in a textbook, and all the lecture halls you had to sit through while you struggled to stay awake. None of that matters now because you finally did it, you graduate college. Congratulations on a job well done!

Two very different feelings and emotions run through you after graduation. The first one is the feeling of accomplishment and success, and you should have this feeling, it took a lot of hard work to get that degree. Unfortunately this first feeling is short-lived, so enjoy it while it lasts! The second is the feeling of “now what” or a gut feeling of uncertainty as to what direction your life is going.

The best thing you can do for yourself after graduation, is to begin dominating your money and personal finances. Follow our 4-steps on how to manage your money and personal finances, and set your life up for financial success.

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1. Emergency Funds are Sexy


Yes you read that correctly, emergency funds are sexy. Not only are they sexy, but you’ll sleep better at night knowing you have an emergency fund and give you a peace of mind. An emergency fund will save your butt if a time arises when you need to use the funds to pay for unexpected expenses, which you wouldn’t have been able to pay for without one.


Your Parents Will No Longer Cover Unexpected Expenses


Remember that time back in college when you and your buddies went on that snowboarding trip and you had to go the hospital because you broke your arm on the slopes, after attempting to do a frontside grab to indy and had to receive medical attention. Then, less than week later you blew a tire driving to class and had to call road side assistance to assist you in changing the tire because you had a broken arm and couldn’t change it yourself.

Yep, that was a bad week. Not only did your greatly anticipated snowboarding trip end in misery and pain, but you also racked up a few thousand dollars in medical expenses from your hospital visit. Then just when you didn’t think your week could get any worse you blew a tire while driving to class and had to call road side assistance which wasn’t cheap, and getting that new tire put on wasn’t cheap either.

That week of unfortunate mishaps not only caused a lot of pain and stress, but it also lead to a large amount of unexpected expenses. Although there’s no doubt that you experienced a lot of stress and pain, you most likely didn’t have to pay for any of the expenses or even see them. Thanks to mom and dad who loved you dearly, they covered the cost of your hospital visit, the road side assistance bill, and the cost to have a new tire put on your car so you could continue getting back and forth to class.

Now that you’ve graduated and are out of college your parents will still love you dearly, but will no longer be willing to be your emergency fund and cover unexpected expenses for you. You’ll be on your own for covering those expenses now, which is why having an emergency fund isn’t only important, but can be your best friend when the unexpected happens.


2. Start Saving Early


You finally made it, you graduated college. After a rigorous and months long job hunt, you landed your first real job and your paycheck proves it. Thanks to that nice paycheck your buying power increased instantly and lenders are much more willing give you loans and lines of credit, increasing your spending power even more.

Things you couldn’t even imagine being able to afford in college, you can now easily purchase with the simple swipe of your debit or credit card. It’s true you can afford to purchase a lot of things you couldn’t before, but just because you can afford to buy something, doesn’t mean you should.

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With Increased Income, Comes Increased Responsibility


When you first get a job that provides a decent income it’s really easy to start spending money on meaningless things, and begin making one impulse purchase after another. It doesn’t take long to develop horrible spending habits without realizing it and rack up large amounts of debt that you’ll be stuck paying off for the rest of your life.

If you want to avoid setting yourself up for financial failure, develop healthy spending habits early on in your career. Better yet, trick yourself by pretending your still in college and living on a college budget.

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Reward Yourself By Saving


When you start your new career after graduating college, your job will most likely be demanding and stressful at times. Reward yourself and your hard work by saving a certain percentage of money from each pay check.

You spend five days of each week at work. Each day you spend a minimum of eight hours at that job. By saving a little money out of every paycheck, you’ll have something to show for all that hard work and time spent at work far into the future.

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3. Retirement Is Closer Than You Think


You just graduated college. You’re young, only in your twenties. Retirement is a far ways in the future. You can start planning and saving for retirement later, right?

Sure, to be exact, you can start planning and saving for retirement anytime but sooner is better. The sooner you start saving for retirement, the sooner you can retire and the less time you have to spend working.

The earlier you start saving for retirement and the more you invest → the more time your retirement savings will have to grow.

By saving, investing, and contributing regularly to a retirement savings account such as an IRA or 401(k), will allow you to take full advantage of the power of compound interest.

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Use Your Money to Make Money


Use your money to make money and increase your retirement income by making your money work for you. I think everyone can agree that the best way to make money is by doing nothing.

Yes, it is possible to make money by doing nothing. Millions of people do it every day and so can you. How is this possible?

This is possible by taking dollars that you’ve already earned (worked for), then putting those dollars into a savings or investment account and reinvesting the money earned on the interest or dividends paid. Otherwise known as compound interest.

When you invest in a retirement account, like a 401(k) or IRA, you have the opportunity to make even more money from the tax advantages those type of accounts offer. This allows those accounts to grow faster allowing compound interest to work even greater miracles.

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4. Make a Budget


It’s hard to know how much of your income is being saved and compared to how much you’re spending, if you don’t keep track of it. This is where a budget comes in.

By making a budget you’re able to decide how much money you’re going to allocate to certain categories each month. When making your budget look at the things you spend money on each month.

When you’ve determined what you spend money on every month → your able to decide whether or not to cut out excess spending and determine how much you’ll allow yourself to spend on other categories you want to keep.

Once your budget is complete at the end of each month, go over your budget to look at your spending from that month. If you went over your budgeted spending limit in any of the categories listed in your budget, figure out how to adjust you’re spending so that you can stay on budget the following month. If you spent less than what you budget for any of the spending categories, that’s just money in the bank!

You’ll be surprised how much a budget can positively affect your life when you make one and stick it. When I first made a budget, it was a huge eye opener for me and I was shocked by the amount of money I was spending on stupid things that didn’t benefit me in any way. This foolish spending only added clutter to my life that would eat away at my savings and income.

You can start making your own budget by downloading our Free Budgeting Worksheet by clicking here (a PDF file), and simply fill in the blanks.

A few great resources and readings on budgeting and creating a budget:






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