Wednesday, May 6, 2009

Top Ten Money Management Tips for College Graduates

Youngsters are very careless with their finances and it’s not them to be blamed but the youth as they tend to feel that the whole world is on their feet but the recession has taught the youth of today in a hard manner and how they should equip themselves to deal with it but with a smile.

Check out some of the money management tips which every college graduate should try and follow:

• Get on a budget. Belt-tightening should be your new plan of action. Put pen to paper and closely examine your monthly expenses. See what can be eliminated, like too much dining out, and what can be placed on hold, like the purchase of that new computer. There are web sites that can help such as, and as well as books such as It's All About The $Money, Honey!,
• Plan for the worst. With the unemployment rate continuing to soar, the rule of thumb is to try to save an amount equal to at least six months of living expenses--just in case. This is not 401K money, since there are penalties to withdrawal from 401K funds. This is just a regular savings fund or money market fund that is easily accessible without penalties.
• Cash is king. Playing the credit card game can be a dangerous one. Remember that "cash is king" and when possible, pay for what you need by cash not credit. And better still, eliminate any unnecessary spending.
• Join the 401K plan. Yes, you should join your company's 401K plan even if you contribute only $25.00 a month to start. Remember that most employers match your contribution, so you're earning extra money while at the same time relieving your tax burden.
• Learn to monitor your money. With the creation of 401K plans many people have been placid participants, unsophisticated novices who have not learned the importance of reviewing their portfolios and marking timely adjustments. You should look at your 401K plan as fluid not fixed--review it for diversification and rebalance on a quarterly or bi-annual basis.
• Financial literacy. Since most Americans are woefully financially illiterate, it becomes your responsibility to educate yourself. When you enroll in your first 401K plan you'll be given a laundry list of funds in which to choose to invest your earnings. Take the time to research them before you invest. Web sites such as and offer advice.
• Use debt sparingly. Learn to rely more on your debit card and use your credit card for emergencies. Never borrow more than you can repay. Start out with one credit card and learn to pay it off monthly, instead of incurring huge finance charges. Or consider a secured card from a bank which is paid for in advance.
• Live within your means. Understand that going out with friends several nights a week can be a costly venture and buying designer duds, although they make quite the fashion statement, don't do much to keep your finances in line. Realize that most of those designers have web or brick and mortar outlets where you can usually get what you want for a lot less.
• Don’t lend money to friends. It can complicate friendships and in the end you can not only lose your money, but your friend. It's just not worth it.
• Choose your first job wisely. Remember, in this economy take any job that has anything remotely to do with what you are interested in. The rule of thumb is that it is the second job that is the most important step in your career path. But, with any job, make sure that you have healthcare benefits and a 401K plan.

I hope these intelligent money management tips come to your rescue and impart wisdom to all the youngsters out there!!

1 comment:

  1. According to me in today’s world nothing is possible without money so management of money is very essential. Stop wasting money on unwanted things,manage your credit card properly and save money for your future by investing in good schemes after doing proper research. By following this you will surely save money. For more details on Money Management refer money management