As the Spring 2024 semester is coming to an end and commencement ceremonies are right around the corner, some of you seniors out there might be thinking, “life is about to get a lot more serious”. Although it’s bound to happen at some time, there is no reason to fear what your future has in store! This should be a time of excitement, so what can you do after graduation to make sure that your finances don’t stand in your way? And if you are not a senior, what are some things that you can start thinking about for your life post-grad?
What steps should I be taking to make sure that I am financially successful post-grad?
There are two key steps that I highly encourage you to take post-graduation:
- Determine a Realistic Starting Salary: Whether you have already accepted a full-time position or are still on the hunt for your dream job, it is important for you to understand your value as a new employee with your degree. A step that I encourage you to take is determining what a realistic starting salary looks like for someone with your education and your experience. One way to do so is by looking at the salary information of your major offered through the Career Center.
- Look at a Cost-of-Living Calculator: If you are moving out of the area, or want to move eventually, your standard expenses could vary based on your location. To help you get a better understanding of what your expenses could look like in a new location, please consider looking at a Cost of Living Calculator and inputting information based on your current and desired location.
Why is it important to budget post-grad?
You may be questioning the value of maintaining a healthy budget once you graduate. However, now that you are out of school and are on a path to having a full-time job, with a larger income often comes more expenses. This can be caused by several things, but here are a few examples:
- You realize that you no longer must eat ramen noodles at least three times a week, and that you can afford to make larger, healthier meals and potentially have leftovers. However, increasing the number of groceries you need also increases your living expenses.
- Maybe you are seeing a heavy expense fluctuation based on a new location that you must adjust to. Maybe you have some time this summer between graduation and your official start date, and you have plans to make the most of it! Or you might be without a source of income until that start date, but that’s a few months away.
Keeping your budget as accurate and up to date as possible will help you avoid spending too much to the point where you are forced to live uncomfortably until that first paycheck hits your bank account.
Maintaining your budget post-grad is essential to help you have a firm understanding of where your money is going and to assure that you are making enough income to cover any new and recurring expenses.
What expenses should I expect post-graduation?
Everyone’s story is different, and your expenditures are a representation of your values and priorities. As much as I wish there was a cut and dry answer, there isn’t, but there are a few common expenses to take into consideration as you enter the next chapter of your life.
Student Loans
If you took out student loans throughout your years in college, repayment would start within a few months. Ensure you have an account with your creditors to inform them of which repayment option you wish to pursue. Having an account will also provide you with information to know when your repayment period starts, where your payments need to be sent or how to set up automatic payments, and the amount that will be due with each payment. It is important that you include these payments in your budget as well.
Emergency Fund
It is important to have an emergency fund established if you don’t have one already. It is advised that you have at least 3-6 months’ worth of living expenses put into an emergency fund. As mentioned above, it is very likely that your living expenses will increase with additional income coming your way. So, after you graduate, it may be beneficial to reevaluate your living expenses and potentially put more into your emergency fund each month.
Insurance
Insurance is crucial to help ensure that you don’t experience a significant loss and must pay for everything directly out of pocket. There are different sectors of insurance that you may deem necessary for your living situation. Certain insurance policies may be offered through your employer as an employee benefit. It is important to understand what coverage you need, investigate those policies, and ensure that you can afford the premium payments at their respective payment schedules.
Retirement
Retirement… Need I say more? I’m pretty sure that all of us would like to retire around the typical retirement age, if not earlier, so it’s better to start investing in your future now instead of putting it off. It may seem unnecessary or even a little bit extreme for you to start saving for retirement now, but as you start receiving those larger paychecks from your employer, it would be beneficial for you to make investments in yourself. By making these payments early, it has more time to grow and compound, giving you more comfort in the future and the ability to live your desired retired life.
Where can I go for help?
As you are about to start your life after college, Powercat Financial is here to help you! At Powercat Financial, we offer free and confidential counseling services to students seeking financial assistance. Whether you want help with creating a new or revised budget as you enter a new phase in your life, want to sit down to look at student loan repayment, consider job options, or have other financial concerns, you can schedule an appointment with a Peer Counselor by visiting the Powercat Financial website at the following link: https://www.k-state.edu/powercatfinancial/. The services provided by the counselors will be directed towards your personal needs, goals and values. Your success is important to us!
Alonna Cross
Peer Counselor I
Powercat Financial
