To All Recent Grads – Some Real-World Financial Advice

Here’s gift of professional and financial advice (and some well deserved congratulations) if you’ve just received your college diploma.

Graduating is an enormous accomplishment well worth celebrating! And with the added complication of the global pandemic, your experience was more challenging than most. But now that the last parties are over and you’ve packed up your dorm room or apartment, it’s time to get ready for the next phase of your life: a full-time, professional job.

The job market is hot, so finding a position with real potential is highly probable. However, it’s important that you know what to do once you start in your new position. We’ve assembled some invaluable advice – both financial and professional — to help you in your journey.

Financial Advice First

You’ve been managing money for yourself for the last few years. But there’s a big difference between working with the money you’ve earned from part-time jobs or internships and knowing how to manage a weekly salary. Especially if you’re making a significant amount of money. You may be tempted to skip returning to your parents’ home, to rent an apartment and buy a car and some work clothes and begin making your way entirely on your own, but that’s not always the smartest thing for you to do financially.

Consider the following financial advice for money management

Living Situation

As much as you may want to live independently, if you can live with your family long enough to give yourself a bit of savings, you’ll be better off in the long run. It will help you to afford the first and last month’s rents that landlords require, help pay for furniture and other essentials, and let you start paying down any loans that you may have.

Benefits

Your company will likely offer you a selection of benefits, and the way that you approach these can make a significant difference. If you are offered a 401(k), take advantage of it. As much as you’d like to hold onto some of your cash, you should always contribute at least as much as your employer is willing to match. (This specific financial advice is key. If you haven’t heard the magic of compounding interest, you can Google it!) Failing to do so is literally giving away free money for your retirement. You should also think carefully about the health insurance that you’re offered. Keep in mind that you are eligible to remain on your parents’ policy until you are 26, so compare the costs and benefits before signing up.

Retirement

Consider opening a retirement fund that is separate and apart from the 401(k). Retirement may seem like a lifetime away. However, it’s smart to get into the habit of depositing into a Roth IRA. The money goes in after-tax and can be taken out when you retire tax-free. You can put away as much as $6,000 per year.

Build Credit

Using your parents’ credit cards to pay for things and don’t have any loans? You need to build a healthy credit history. Take out a credit card in your own name and make sure that you pay them off every month. The best financial advice here is to take care to pay every bill in full on time.

Budget

Learn to keep a budget. Now that you have a predictable salary and take-home pay, it’s time to sit down and figure out your budget. Write down your total monthly net income and total monthly expenditures. Include necessities like groceries, rent, utilities, etc., and figure out what you can spend, and how much you can save. Determine the amount that you can afford to pay off your debts – and stick to it!

Now the Professional Advice

Starting a new job always feels like opening a door to endless possibilities. And that’s especially true of your first job out of college. While mistakes happen, there are also things that you can set yourself up to do right, right off the bat. Here are some suggestions collected from multiple executives and culled from years of experience:

Take chances

Don’t be too risk-averse – this is the time to take some chances. If ideas have been thought out, it’s okay to make mistakes. And sometimes your fresh perspective can make a real difference and set you above the crowd.

Be Yourself

Let your personal attributes shine. Many people enter the professional world with an idea of how they are supposed to act or who they are supposed to emulate. You were hired for your own characteristics, so be sure to be yourself.

Put yourself out there.

Meet as many people as possible. Networking is an invaluable tool. Each new person that you meet should be considered a link to your future.

Slow Down

Taking your time can be a virtue. Sometimes being in a rush is detrimental. You could skip steps that can be valuable to your growth.

Travel

Take every opportunity to travel. You will learn a great deal from traveling as part of your job – both internationally and domestically. Travel exposes you to different cultures which opens up a new world in more ways that you can imagine. Plus – professionally you may be viewed as more open to interesting or diverse assignments.

Keep the Door Open

Don’t turn down responsibilities that are outside of your expertise. The more you open yourself up to learn new things, the more flexible and adaptive you become. And the more opportunities that you will be given.

Remember that every job teaches you something. Even a job that you despise has skills that you can carry or use to create a better opportunity. It may not be your dream job, but it may be a necessary step to reaching your dream job.

Be sure to listen carefully to those around you, whether they are your colleagues, your clients, or your supervisors. Being a good listener is highly valued.

As you grow in your career, you may have financial questions or need guidance from someone with more experience. Please contact our firm if you need help navigating personal finance or tax-related matters.