Money Tips for College Grads

Graduate of 2013


Guest post by Nico Leyva
Nico Leyva writes for Nerdwallet, a consumer finance website that promotes financial literacy and looks for the best ways to save you money.

Congratulations! You’re just about to graduate or already have graduated from college and are now officially an adult ready to embark on a journey into the real world. Unfortunately, you now have a whole new set of responsibilities and commitments. You are starting to become, or have become, financially independent, which brings with it a number of potential pitfalls and difficulties. You may be expected to support yourself with a job, pay your own rent, pay for a car, and pay for various other cost-of-living expenses, including food, health care costs and student loans. Keeping up with your finances is probably starting to seem a bit daunting. Don’t fret! We have some tips to help college grads stay financially healthy.

Don’t Overuse Your Credit Card – A credit card can be a great option to help you manage your expenses. But don’t start charging everything, because your account could become unmanageable as your amount owed increases. Credit cards tend to have higher interest rates for younger consumers, and bills can quickly spiral out of control. Unpaid bills or late payments will negatively affect your credit score and, in turn, your ability to receive loans and credit in the future.
Do Establish Credit – Managing debt is a very important way to establish credit and build towards better credit. Making sure you pay your student loans on time, and managing monthly personal loan payments or credit card bills will have an immediately positive effect on your credit score. Keep your total amount owed as low as possible and check your credit report (you get one free report each year from each of the three main credit bureaus) as often as possible, to ensure there are no errors. If you need help, schedule an appointment with a GreenPath counselor, a free service provided to members of Members 1st Federal Credit Union.
Keep a Budget – This might be the first time you’ve had to manage a budget on your own, and keeping track of every monthly or weekly expense can be tough to do off the top of your head. Create a worksheet or calendar of all your potential expenses and compare that to your monthly income. Keep it as simple as possible. Try to cut back on unnecessary expenses and focus on needs versus wants. It’s also very important to use online banking or a checkbook to track your transactions, so you know how much money you have and don’t get charged for overdrawing your account.
Start Saving – It’s never too late or too early to start saving. You should have a savings account that you contribute to regularly. It can provide back-up for your checking account, and it will help you be better prepared for future expenses and for life stages like buying a house, or saving for retirement.
A Car: To Buy or Not to Buy? – Cars are a big financial burden. Not only do you have to consider paying off the car itself, you have to account for possible loan payments, insurance payments, gas, and repairs and service when needed. Before considering a car, check out public transportation options in your area. Is there a bus line, subway or metro that runs near your work? Can you bike to work? All of these options will cut down on the amount of money you would be spending on a car each month and free up funds for other uses. Ask Members 1st about their First Time Car Buyers Program that’s available to college graduates.

You have your whole life ahead of you. Make sure you are putting your best foot forward financially. And don’t be afraid to ask for help, especially from your local Credit Union. Members 1st Federal Credit Union has a financial Advice Center to help you with any questions you might have, and you can always call them to speak with someone one-on-one. They’ll help you get on the path to financial success.

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