If you’ve recently graduated, you’ll find that you have many new challenges in your life. Finding employment should be your top priority, but beyond that, you need to figure out a way to pay off your student debt, consider planning for retirement, and more.
However, just the task of paying your monthly bills can be daunting. If you lived on campus or stayed with your parents during school, you’ve likely never had to deal with this before. Yet by implementing a few common sense tips and strategies, you can find plenty of ways to effectively manage your finances.
1. Consider Taking on a Roommate
If you’re single, a great way to save money is to take on a roommate. You can advertise at your alma mater or online, such as at Craigslist. Put together an informal screening process, and, at the very least, a credit check. If you want to go the extra mile, obtain a criminal background check as well.
Clearly outline what the rent will be and what it will include. Consider an in-depth, in-person interview, in which you can gauge the candidate’s overall appearance and if you think they’ll be a good fit. Remember, this will be the person you’ll be seeing day-in and day-out.
Always get a signed contract outlining the terms of the agreement – getting the first and last month’s rent upfront never hurts either.
2. Create a Budget
Next, you’ll want to create a budget for yourself. The key here is to spend less than you make. Write down what you earn each month and compare it to what you spend. If you’re spending more than you make, immediately look for ways to cut back. Otherwise, you run the risk of falling into credit card debt, something that you never want to do.
3. Save on Groceries
When it comes to saving money while living on your own, groceries should be at the top of your list. If you’ve never clipped coupons before, I’d consider starting. Once you get a system in place, it’s not as time consuming as you would think. To further increase your savings, partner these coupons with your grocer’s double coupon days.
4. Check Your Utility Bills
Whether you decide to rent or own, utility bills can be a very costly expense if left unchecked. Adopt a “how low/high can you go” attitude when it comes to your thermostat. Wearing tank tops and shorts in the summer and extra sweaters in the winter are easy ways to save on home energy, especially if you live alone. Remember to turn off all appliances when not in use, and unplug the ones that you rarely use.
5. Curb Entertainment
Now that you’ve graduated, it’s unlikely that you’re going to find the same cheap entertainment options that you did during school. Therefore, you’ll want to exercise restraint in this area. Consider limiting your bar-hopping nights with friends, and when you do go out, investigate happy hour prices and hit the clubs with the best deals. There are also lots of cheap stay-at-home entertainment options, such as renting DVDs, trivia nights, and board games.
Once you’ve got your budget set and you’re on track financially, consider initiating a retirement savings plan. With the power of compound interest helping you out, it’s important to start as early as you can, even if you can’t set aside huge sums in the beginning. If you’re new to the world of investing, start off by participating in your employer’s 401k program, and contribute as much as you can. Next, look into the many IRA options, and consider opening an account.
Life after college does not have to be burdensome, and with the right mindset you can get your post-graduate life off to a great start and enjoy a financially beneficial future.
What ways can you think of to save money after graduation?