Graduating from college can be an exciting but worrying time. If you haven’t got a job lined up, and if you still have student debts to pay off, you might be more than a little anxious about your personal finances. You’re not alone – many of us have this issue – so if you’re relating, you might find the following helpful.
#1: Don’t let your debt spiral out of control
According to research on student debt, more than 6 in 10 students graduating in 2019 had student loan debt, and they owed an average of $28, 950. Many students also have credit cards, which they have used for both practical means and leisure pursuits.
The key to paying off your debt is to get a job as soon as you leave college, even if its something that isn’t affiliated to your degree. This will be your means of paying off your debt sooner rather than later. To ensure your debt doesn’t spiral out of control, you should:
- Focus on paying off your credit cards first, as these often hold the most interest
- Make every effort to make your monthly payments on time, for both your cards and student loan
- Check to see if you qualify for a deferment or forbearance if you’re struggling to pay off your loan. In both cases, you will be offered temporary relief from your loan
- Talk to your lender if you’re struggling as further help may be available to you, such as a more affordable repayment plan
- Visit debt.org for professional advice on managing and paying off your student loan debt
By keeping your debt under control, you will cause less damage to your credit score. This means you will have less trouble when trying to get your foot on the property ladder or when funding somewhere new to rent. For more on this topic check out these tips on rebuilding your credit score.
#2: Live frugally
You might be used to living frugally anyway, as many students have to when their finances run dry. But whatever the case for you, you should:
- Find free things to do in town with your friends, such as going for a walk, visiting free museums, etc.
- Save money on books and movies by loaning what you need from the library
- Learn how to cook so you aren’t reliant on takeaways and expensive (and unhealthy) microwave foods
- Pay less on your essentials, perhaps by collecting coupons and discount vouchers for your regular items. Check articles online for ideas on paying less for clothes and other items. And look for other resources for money-saving tips. There’s an excellent book on Amazon about paying less for your eyeglasses, for example. Follow this link to read it on your Kindle
- Put off your exotic vacation ideas and visit places closer to home until you have savings in your bank
#3: Prioritize your goals
When you start earning money you might be tempted to splash out on all the things you couldn’t afford as a student. But go steady, as you need to think about your goals, such as buying a home or a car, or saving money to clear your debts.
Be sensible then and open up a savings account. Put money into an emergency fund too so you aren’t reliant on your regular savings if disaster strikes. And even though it might be a long way off, consider what you might need to do when it comes to retirement planning. By taking these steps, you will have a better chance of meeting your life goals.
Money: we know it’s a boring subject, but you will need it for all aspects of your life. Follow our advice then, and look for other advice online!
Good luck with your new post-college life!