Graduation season is about to be in full swing. With that time comes a lot of new changes — leaving college behind, possibly moving to a new location and finding your first “real” job amongst many other things. With just over 19 million students enrolled in college as of 2014, there are sure to be a lot of students facing this very situation in a few short weeks.
Often times, finances get overlooked. New money management tasks can range from paying off student loan debt to handling the first relatively decent salary in your life. Transitioning into this new phase of life doesn’t have to be overwhelming, though. In fact, there are many easy ways to save money as a new college graduate and most of them don’t require a lot of work. If you’re looking to save money now that you’re on your own or know someone who is, then the following tips can help.
Start a Budget
You can’t manage what you’re not informed about. It might seem unnecessary or burdensome, but starting some sort of a budget is one of the best ways to save money as a newly minted graduate. The purpose behind this step is to help you get to know yourself, your spending habits and what triggers them.
There are a variety of methods to start a budget, from a basic spreadsheet to programs like Mint, Personal Capital or You Need A Budget. Find what works best for you and go with it. Don’t be afraid to change it up or work until you find something that gels with you as it can take time.
Give Yourself a Slush Fund
A slush fund might seem to fly in the face of starting with a budget, but the two things very much go together. It can be easy to go out and spend money mindlessly, especially if you’re in a new city or have extra money. Many do it, having a slush fund can help mitigate the impact. It gives you $50 a month or more to spend freely. You can figure out the amount that works best for you and your current budget.
Avoid Lifestyle Inflation
By definition, lifestyle inflation is spending more because you’re now making more. There is nothing wrong with enjoying life, but giving in to lifestyle inflation can cost you more in the long run as a new graduate.
Besides establishing and living by some sort of budget, one of the best ways to avoid lifestyle inflation as a new college graduate is to be wise about your purchases. Some of those things can be renting instead of buying, looking for a roommate to share costs, buying a used car instead of a new one and skipping a car altogether if possible.
If you do have extra income, use the funds to pay off any student loan debt or start a small emergency fund.
Put Money in Your 401(k)
It might seem as though you can’t afford to save money for retirement, especially if you have student loans, but putting money into your 401(k) can be one of the best ways to save money as a new graduate.
Not only will you likely receive free money in the form of a company match, but you’re also putting money away for your retirement. The amount you might be able to put in your 401(k) may seem too small today, but it does grow over time, and it comes with tax benefits.
Learn to Cook
One of the more practical ways to save money as a new college graduate is to learn how to cook for yourself. It can be easy to justify going out for a meal if you’re busy, or in a new city, but those meals add up quickly. If cooking seems difficult to you, or you don’t know where to start, then begin with a few simple meals. The Internet is ripe with recipes. Not only will it save you money but it can also be much healthier.
Life as a new college graduate can take some getting used to, but with a little work, you can save money along the way, without sacrificing too much.
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5 Ways to Save Money as a New College Graduate originally appeared on usnews.com
