Financial GPS for the Recent College Graduate

So you’ve just graduated from college and are about to embark on the next stage in your life. Now that the celebrations are over, there are probably a number of mixed emotions and apprehensions about what the future holds. The number of stressful decisions can be overwhelming, with financial stress probably somewhere near the top of the list. Here are some common anxieties that cause recent grads to lose sleep:

Your dreaded first student loan payment is due soon.

Trying to pay off your student loan as quickly as possible is a great idea and more power to you for trying to get out of debt. But if for whatever reason you just don’t have the money, you may qualify to delay repayment through deferment or forbearance. Don’t be too quick to turn to this option, though, because your loan balance could jump up significantly in the future. Read more about loan deferment and forbearance here.

Why did you sign up for that credit card that now has a $3,000 balance? What were those clipboard people doing at the bar anyway? The free t-shirt seemed like a great deal at the time…

Credit card companies love sucking college students into debt they’re not ready for.  Most have campus representatives that travel college-to-college, signing up as many students as possible. Pay off this debt as soon as possible! Live frugally until this debt is eliminated; you’ll breathe easier at night and thank yourself later.

You have a job and can’t wait to spend every penny of your paycheck!

Getting a paycheck may mean more disposable income than what you’re used to, but that doesn’t make it okay to be financially irresponsible. If your company offers a 401(k), contribute enough to maximize the match offered by your company. Build a budget. One helpful technique may be opening two checking accounts. Direct-deposit your paycheck into account A and set enough aside to pay your bills and maybe even build up your savings. Then transfer whatever’s left, be it $5 or $500, into account B–that’s your spending account.

You don’t have a job (but it’s not your fault, the economy is bad… right?).

Don’t just sit around all day if you can’t find a full-time job. Yes, unemployment is high, especially for college graduates, but that doesn’t give you an excuse to be lazy. Part-time jobs are a great way to pay the bills and provide extra cash until a full-time job is landed. Manage your time wisely and devote a significant amount of time to job applications, networking, and practice interviews.

You moved back home but want to move out no matter what it costs.

By all means, move out of your parents’ house! It will force early responsibility, discipline and learning whether you like it or not. If you choose to stay home with your parents, don’t give into the temptation to spend money that you might otherwise be using for rent. Set up a monthly transfer from your checking account to a money-market account and put extra cash there instead. Make the amount greater than or equal to what you might be paying in rent. This will make it easier to move out sooner.

Still feeling lost? Here are some books to help bring your stress level down and put you on the right financial path:

Do you have any tips for friends who are recent grads? Or additional anxieties if you’re a recent grad yourself? Share them in the comments.