However, a drastic life change takes place after you walk across that stage and get your diploma. Nothing can fully prepare you for navigating through this newfound independence and responsibility. If you are not careful, you may find yourself lost in how to deal with your new financial responsibilities.
You are just making the transition from student to adult but you need to be pro-active and immediately start thinking about your future. As both a father to children that are in college and a financial advisor, I know the biggest mistake you can make is to not examine your financial situation upon graduation.
It is not that recent grads lack the motivation; it is that they lack basic financial knowledge. Here are three tips to help you navigate this new chapter in your life and make solid financial decisions.
1. Have realistic expectations.
Recent graduates are part of the “me” generation. They have grown up with parents telling then that they can do anything they want. One problem with that is that many graduates imagine that they will jump from college right to the corner office with a big salary. No one has bothered to remind them along the way that there will be dues to pay and working your way to that corner office takes both time and patience.
When you expect that you will come immediately out of college and find a job with a six-figure income, you will be sorely disappointed. You have to examine the debt that you have, the money that you will be making and remind yourself that it is okay to graduate college and still live with roommates. It is okay to not buy a brand new house and a fancy car. If you are smart now, you will be able to work your way up to all of those things in the future.
2. Do not choose a job based on salary alone.
It may be tempting to automatically take the job offer with the largest salary, but there are several other things you need to think about when choosing your first job. You need to think of growth potential. Is this a place that you can advance? Does this job start you on the path to the career that you want? Will the position offer a good learning experience?
Yes, you want to earn the most money possible but keep in mind that your first job will set the tone for future jobs so if it comes with potential to advance and significant learning opportunities do not think just in terms of the amount of money you will be making. Experience is an invaluable tool for negotiating future opportunities.
3. Pay off your debt.
You just started receiving a paycheck that likely has several more zeros than you are used to seeing. It will be tempting to go out and spend that money but you need to examine your debt first.
It is perfectly normal to graduate college with debt. Whether it be student loans or credit card debt it needs to be taken care of immediately. Your parents may have covered some of your expenses in college but will likely not be covering anything anymore. The quickest way to get yourself into serious financial trouble is by living beyond your means and not addressing your debt. Paying your college debt off as quickly as possible will take a huge weight off of your shoulders.
Being financially smart early on in your adult life will pay off big in the future.
By Ricardo L. Nazario
Morgan Stanley Smith Barney http://www.yourhoustonnews.com
Nazario is a Financial Advisor with the Global Wealth Management Division of Morgan Stanley Smith Barney in Houston.
Other users which our blog-site focuses on, are learners at school, parents, university and college students and those looking at studying and improving their education and finding economic strategies and creative solutions to financial problems.
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