Graduating from college is an exciting achievement, however, many new graduates can be met with unexpected financial troubles. Navigating life after college can be difficult, which can lead to tough decisions related to finances.
When it comes to managing finances, it’s better to form good habits early on, instead of dealing with the consequences later on in life. To help get you started, here are 5 financial tips all graduates should consider for a financially stable future!
It can be tempting to splurge on new items for your apartment or living quarters. Many new graduates use their paychecks to purchase items that they don’t necessarily need all at once, leaving little left for paying bills.
Even though this is an exciting time, it can be easy to spend hundreds of dollars purchasing furniture, fun kitchen items, or new decor. However, it is wise to gradually make these purchases over time and spend your money on essentials. Slowly purchasing items you want will be easier on your bank account, allowing you to save money and pay your bills on time.
Take Your Credit Score Seriously
While building your credit, it’s important to not lose sight of the effect that your credit score can have on your future. It’s easy to open up several credit cards in order to buy items you want, and then slowly build up credit card debt. In addition, interest gets charged to these debts, increasing your payments over time.
However, when you take your credit score seriously, and work to build good credit, you will have an easier time when you are ready to purchase a home or apply for a loan. It’s important to consistently make payments on your credit cards and responsibly manage your credit utilization to help keep you on track!
Get Creative in the Kitchen
We know, making food at home can be a pain, especially if you don’t like to cook. However, eating out for lunch and dinner, even if it’s considerably inexpensive, can add up. When you take the time to consistently purchase groceries and prepare your own meals at home, you will not only eat better, but also save money. There are plenty of websites and resources to help you get started, especially if you are cooking on a budget!
Establish an Emergency Fund
An emergency fund is money set aside only to be used in a true emergency, such as being temporarily laid off or having unexpected expenses. If the financial crisis related to COVID-19 has proven anything, it’s that Americans need an emergency savings set aside specifically for tumultuous times. Even though you might be fresh out of college, starting your emergency fund now will help you weather tough times.
Utilize a 401(k)
You are never too young to start saving for retirement, and a 401(k) is a great way to start. A 401(k) is a retirement savings account that is specifically set up by your employer that you can divert part of your salary into. Those contributions are then invested. One benefit of a 401(k), is that even if you switch employers, you can typically roll over the existing 401(k) to the new employer, so you don’t have to worry about taking on new adventures down the road.
Here at Blackhawk Bank, we want to make sure you are financially ready for your future. If you want to learn more about how Blackhawk Bank can help you, contact us today!