Seven steps all recent college grads should take to achieve great financial and career success
by Kiran Sood
Back in the spring of 2008, a few months shy of my graduation from the University of Illinois at Urbana-Champaign, it seemed I was one of a handful of graduates setting off with a plan. Well thought-out, and solid. I majored in journalism and minored in Spanish, and my plan included entering in graduate journalism school at Northwestern University’s Medill School last fall.
The year went accordingly, and I had the future—or at least the immediate future — mapped, as many of my friends were heading back home, scratching their heads over career goals and other life choices.
For me, luckily, I only had to endure four months in my parents’ home before I embarked on 16 months of independence, studying and living in downtown Chicago.
I got lucky. But luck is quite often made.
Every year, the nation’s college graduates go out in style. Cameras flash while they walk across a stage, shake hands with school leaders, toss caps into the air, and get blessed with all manner of congratulation from parents and friends.
Fast forward to the following Monday morning. Now what? For many college graduates, there is little reason to keep the celebration going. No job, and many are returning home to Mom and Dad.
In recent weeks, I have been speaking with many experts on personal finance. So for the crop of recent graduates — many emerging unemployed — here’s a quick list summarizing experts’ advice. Seven steps to avoid financial ruin!
1. Consider the merits of higher education before you take it on as an investment. Returns on investments in the form of education often take years to materialize. Be confident that the area you decide to specialize in is truly a fruitful area in terms of career prospects. Judge how valuable a graduate degree is in the field of your choice.
2. Create and maintain your own brand through a positive Web presence. Treat your Twitter, LinkedIn, and Facebook accounts as ways to positively promote your skills, talents, and ideas to potential employers. Maintaining a blog is a way to incorporate your thoughts, experiences and encounters to others in a personal and professional way. Treat it as so.
3. Channel your innovative ideas with the help of other entrepreneurs. Find a productive and unique way to get across what you have to offer to the marketplace. Be consistently on the lookout for people you meet who can increase your career network and also offer you tips on taking your business or ideas in a new direction. In other words, network….endlessly.
4. Buy health insurance. If your employer does not provide the coverage, it is important to get coverage independently. It’s easy to think we, so spry in our 20s and early 30s, are immune from health concerns but life can be flipped on its head with one doctor’s visit. Be prepared.
5. Create a short-term financial plan, at least for the next five years. Take advantage of financial software products available online, including Mint.com. Take advantage of free personal financial workshops and sessions offered by the nearest branch of the Federal Reserve Bank in your area. The Federal Reserve Bank of Chicago, for instance, offers a program called Money Smart Week, featuring financial literacy workshops and educational initiatives for all age groups aimed at helping consumers better manage personal finances.
6. If you have credit-card debt, pay it off immediately (or as soon as humanly possible). Reduce the amount of credit cards you have to one, and as best you can, pay the balance every month. They go hand in hand. Delinquencies on the value of all card debt soared to a record 6.6 percent from 5.5 percent in the fourth quarter of 2008 as more cardholders relied on plastic to meet day-to-day expenses, according to the American Bankers Association.
7. Don’t spend more than you earn. The idea seems fundamentally simple, but not at all easy to carry out. For those who do land jobs, there is the temptation to spend lavishly as each paycheck arrives. But holding back, saving even a few bucks now can mean a great deal less to worry about in the future. There are future wedding plans, home mortgage payments, or simply a new car. Having all, and having it happily, is simply the dream that defines this nation. But missteps early – buying the midsize instead of the cheaper compact vehicle—mount and could prove disastrous, credit-wise.
By implementing these seven tips, recent college graduates are ensuring that before they decide what to do with the rest of their lives, they can rest a little easier knowing they are planting the seeds for success in the future.