After four or more years of tough classes, piles of homework and maybe even a little student loan debt, graduating from from college and entering the job market can be both exhilarating and terrifying as you test the waters of financial independence. If your ultimate goal is to be a successful, financially secure adult, the following tips will help you avoid mistakes and free you up to win in your career and adult life.
Live on less than you make, always
Whether you have been fortunate enough to find an entry level job in your field or you will be juggling an assortment of part-time jobs to pay the bills while you look for the right one, it is important to make a commitment now to always live on less than you earn and put something in savings. Doing this will ensure that you will always have a safety net to help you through hard times without accumulating credit card or other unnecessary debt.
A good way to do this is to budget for all your expenses and put the excess into a savings account as an emergency fund. According to one leading financial guru, you should consider having at least $1000 in an accessible emergency fund while you are still paying off student loans or other debt. Once you are out of debt, you should expand that amount to approximately 3 to 6 months of living expenses.
Always be learning
If your ultimate career goal will require additional training or education over and above what your current degree offers, make sure that you develop a plan to get it. Some good ways to do this without wracking up more debt is to:
- look for employment with companies who offer educational or training benefits
- take additional classes online, as you can afford to do so
- find a successful mentor in your field to emulate and learn from
Insure against losses
Guarding against loss is especially important when you are living on a small salary. In addition to maintaining an emergency fund, it is important that you also insure your life and property against losses. In most cases, no-frills coverage is a good choice for young adults. Insurance coverage to consider includes:
- carrying the state-allowed minimum auto insurance, if you do not have an outstanding car loan or an appropriate full coverage plan, while paying for your vehicle
- carrying a major medical health policy to protect you in case of serious injury or health issues
- carrying a small life insurance policy sufficient to cover your debts and pay final expenses, if you are single with no children
- carrying a term life insurance policy sufficient to provide for your spouse or children in case of your untimely death, if you are married or have children
- carrying a disability policy, if your chosen career path is a dangerous one
Healthy, non-smoking, young adults usually enjoy the least expensive rates for both life and health policies, so be sure to ask your insurance representative to fully explain how each policy will apply to you, both now and in the future. Contact a company like Advantage Insurance Agency, Inc to learn more.Share