Money tips for new graduates
Speaking from experience, once you graduate from university, it takes a while for your brain to catch up. You’ll still have moments where you’ll find yourself thinking ‘I still have those readings to do tonight’ or you’ve become used to constantly having assignment-related stress. But once you slowly start to let things go, you’ll soon face a new worry - managing your paycheck once you get a full time job. If you’ve just graduated from uni or are about to, here are 5 money tips to get your new uni-free life off to a great start.
Start an effective savings habit.
During your time at uni, saving was probably the last thing on your mind. If you were like me and had time to spare before classes, you probably passed the time online shopping or wandering around the uni’s convenience store, hunting for snacks. By starting an effective savings habit after you graduate, not only will you always have cash lying around, it’ll help you prepare for the things you want in the future, like a new car or home.
One idea you could try is to automate your savings payments. Thanks to online banking, each time you receive a paycheck you can have a designated amount, like $100, automatically deposited into a high interest savings account. It’s fast, simple and you won’t even have to remind yourself to do it. And if you keep this up for 6 months, you’ll have a savings stash of at least $600!
Oh, and when it comes to saving your money, it’s a good idea to start an emergency fund. An emergency fund is a bank account that holds at least 3 months worth of living expenses just incase something goes wrong, like an unexpected car repair or if your fridge suddenly dies. These situations are stressful enough, without feeling like you have to go into debt to cover your costs.
Prioritise your spending.
We all love our little luxuries, like buying a new handbag or a new pair of sneakers even when we don’t necessarily need them, but once you graduate from university and live on your own, your money starts going to things like rent, bills and groceries. Now we’re not telling you that the days of treating yourself are over, you just need to figure how and when to squeeze these treats in, without going into debt. This is where you’ll need to come up with a budget to help you understand where all your money is going and how much you’ll have leftover to splurge. But the good news is, tools like Mozo’s budget calculator or apps like TrackMySpend can do all the hard work of budgeting for you!
You might also want to think about factoring in any upcoming or unexpected expenses that could come your way, like replacing your laptop you know is on its death bed.
Make a financial plan.
Following and sticking to any plan will all come down to motivation. We all think about the stuff we want to achieve but then don’t follow through, so physically sit down and write out a plan of where you’d like to be in one, five or even ten years - these will be your short and long term goals. It might also be a good idea to get specific and add monetary values to these goals, like planning to save $1,000 in a year.
Then, keep it somewhere you know you’ll see everyday, like your bedroom wall or phone’s screensaver. It might look silly to everyone else, but nothing will keep you motivated and on track with your money than being reminded of the things you want to achieve everyday.
Get your credit off to a positive start.
Establishing a good credit history is important once you start working full time. Your credit history will play a massive part when the time comes to buy a house or car, so you’ll have to show that you can be smart with your money and can keep debt to a minimum. You can start by always paying your bills on time, having at least 3 months worth of savings or by paying off more than the monthly minimum repayment on any credit card debt or loans you may have.
Take investing seriously.
Right now, retirement may seem like a long way away and even though we have automatic super, investing could be another avenue worth exploring to set yourself up financially in the long run. So why not do an investing crash course to find out everything you need to know about stocks, bonds or even property investments. For instance, you can sign up to ASX’s free online courses to give yourself a proper education.
If you’re a graduate in need of some money savvy inspo, you’ll love our Life and Money hub, it’s filled with great tips and tricks for saving.