Northeast Wisconsin
  • Northeast Wisconsin
  • May 2018
Written by 

What graduating seniors should know about money

As thousands of proud parents celebrate the graduation of their children, many graduates are looking forward to being on their own. Living independently is a significant change. Here are some tips for new graduates.

Have a spending plan

Without a budget or spending plan, it’s easy to spend everything you earn and then some! Identify your core expenses for necessities like rent, utilities, food, health care and car insurance. Then, determine what you can afford to spend on wants like entertainment and travel.

Count all housing costs. Don’t sign a lease until you know all the costs and know if it fits within your budget. How much does heat cost in the winter and air conditioning in the summer?

Many students have been covered under their parent’s auto and health insurance. In some situations, parents might continue that coverage, or it may be time for the graduate to pay for this. Don’t go without coverage. Factor these costs into your budget.

Calculate student loan payments into your budget before you consider upgrading your car or committing to other large expenses.

Live within your income

Don’t overspend on furnishings for your new apartment or on new clothes. Just because some of your friends may drive new cars or be living large doesn’t mean that they are doing well financially. Have fun, but live within your income.

Save money for a rainy day. Smart people save money for future unexpected expenses, like car repairs, health care and other unexpected expenses.

Always pay your bills on time. This helps to build a positive credit rating that can save you thousands of dollars on major purchases like a car or a home.

Begin saving for retirement immediately

Start saving in your employer’s 401(k) plan as soon as you are eligible. If you don’t have access to a 401(k), then save in your own traditional or Roth IRA. Even small amounts of money can add up to be a lot.

There is more to life than making money. Plan to have a life outside of work. Don’t let worries about money dominate your life. Take action to get organized and have a plan to make the most of your money.

Alan Prahl

Alan Prahl is the Education Leader with FISC, the Financial Information & Service Center. He has an undergraduate degree from the University of Wisconsin in Madison and law degree from Hamline University. A nonprofit program of Goodwill NCW, FISC provides financial counseling and coaching, including a no-cost, no obligation 30-minute consultation with the “counselor on call.” To learn more, call 920-886-1000 or visit www.fisc-cccs.org.

Website: www.fisc-cccs.org
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