Tips for Recent College Grads
Financial Tips for College Graduates
1. Make a plan for your student loans
Student loans can be one of the scariest parts of graduating from college. The first step is to plan how you will repay your loans. Start by looking at how much you owe, the interest rates on each loan, and the repayment terms. Make sure you chose a payment plan that you can manage and always make your payments on time. If you can afford to, paying a little extra on the principle of your loans can help you pay off your student debt faster.
2. Create a budget you can stick to
Creating a budget can be very beneficial for managing your finances, especially if you are becoming financially independent for the first time. Start making your budget by listing your income and expenses, determining your savings goals, and allocating your funds to balance your budget. See our blog 3 POPULAR BUDGETS YOU CAN STICK TO for more ideas on how to create a budget that will work for you.
3. Start saving for retirement
Even though retirement seems so far away, the sooner you start saving, the better off you'll be in the long run. If your employer offers a 401(k) plan, you should take advantage of it and begin to save a percentage of your income for retirement. Some employers offer matching contributions to your 401(k), which you should max out if you are able. If your employer doesn't offer a 401(k), you should look into opening an IRA account to start your retirement savings instead. Learn more about IRA accounts at Connected Credit Union.
4. Build up your credit score
Building a strong credit score can also be very beneficial in the long run. To improve your credit score, focus on making on-time payments and paying down credit card balances. Avoid utilizing your credit cards at their capacity and opening too many new accounts within a short period of time. Remember that building a strong credit score can take time, but the sooner you start, the better off you will be. Having one major card is a better credit builder than having store cards. Again, keeping in mind credit cards should be used for emergency situations and paid in full every month if at all possible.
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