For most the American Dream is graduating from college, getting a job and getting out on their own to make a life for themselves. In current years, this it becoming more difficult for many to do.
Student loan debt
You may have had a job and apartment while in college, but now you will likely be making more money which with it comes the temptation to increase your spending. In many cases you may be saddled with student loan debt and also possibly credit card debt. The cost of college has been increasing so in turn also has student loan debt.
If you have a considerable amount of student loan debt it may seem like a daunting task to pay it off, but if you keep up with the payments and apply extra when you are able it will disappear in a reasonable amount of time. You may consider drawing out your payments over an amount of time since the interest rates seem low, but even the low rate of interest will add up over time. It may be wise to try to pay it off as soon as you can.
What are you taking home?
Along with student loan debt you may also have health insurance costs, living expenses, and more that you did not have in college. While in college you were probably still under your parents health insurance plan. In many cases, you will be under your employer’s plan, but they may take the premiums out of your paycheck.
Along with a larger salary comes higher taxes. You need to remember you will not be taking home what they quote as your salary. When developing your budget take your net income or what you will have after taxes, and other items that have been deducted in to consideration.
Saving for retirement
With the expenses of getting out on your own, retirement savings may be one of the last things on your mind. When you are young it is difficult to think about saving money that you will not be able to use for several years. But with retirement savings, it is important to start saving as early as you can. With the power of compound interest, over time the earlier you can start saving, the less you will need to save in the long run.
Life after college can be both exciting and scary, but by having a financial plan can help make it more exciting than scary.