retirement

Financial Lessons for Recent Graduates (That We ALL Could Take to Heart)

Your financial future is in your own hands, and these four lessons are a great place for grads to get started, or the rest of us to get back on track.

June is graduation season, and for those who are moving on to higher education or entering the workforce for the first time, it is important to carry the timeless wisdom that comes from beyond the textbooks. Moreover, we could all use some reminders of the lessons that we sometimes overlook in our finances. Here are four:

1. Start saving for retirement as soon as you possibly can.

Many jobs today offer retirement savings plans, such as 401(k)s. Employers will often match a percentage of the contributions that you make, so you have an immediate multiplier just by putting money into the plan. Don’t ignore this opportunity, regardless of your stage of planning.

2. Piling up debt really hurts.

Especially for the college graduates with student loans, but even for those who have excessive mortgages and big credit card bills, having debt is a huge burden. Work to eliminate the high-interest debts, and if you cannot afford something, then do not go deep into debt to buy it. If you want something that is nicer, save for it now and let interest work to your advantage instead of against you.

3. A little self-control goes a long way.

Do you really need those luxurious things that you see in the media and in the stores? A good policy is to wait for three weeks after you think that you need something that you want. If your feelings change and make you look at something else, then start the clock again. Another idea is to count out the cash on a table for what you want to buy instead of running to the credit card. The more expensive the item, the more cash you will see on the table. You may change your mind after seeing the money in that way.

4. The future is closer than you think.

You may be reading this letter as a recent graduate, or you may read it wondering where all the years went since you graduated. If you are trying to find a job, make connections, learn a skill/language, save money, reduce debt or complete a big project, regardless of how hard the task may appear, do it now. The last thing you want is to find your future as a series of missed opportunities and closed doors, so empower yourself today.

Did you know? Now could be a great time to find out your credit score and see your credit report, especially if you are moving into a new place or on your own for the first time. The earlier that you can find out if there are errors, excess credit card applications, late payments or other issues, the quicker you can work to repair them.

About the Author

Justin J. Kumar, Investment Adviser Representative

Senior Portfolio Manager, Arlington Capital Management

Justin J. Kumar embraces a proactive, systematic investment management approach with a customized, proprietary system to help guide his clients toward their financial goals.

Most Popular

Where's My Stimulus Check? Use the IRS's "Get My Payment" Portal to Get an Answer
Coronavirus and Your Money

Where's My Stimulus Check? Use the IRS's "Get My Payment" Portal to Get an Answer

The IRS has an online tool that lets you track the status of your stimulus checks.
February 19, 2021
Want More Tax-Free Retirement Income? One Man’s Whole Life Decision
life insurance

Want More Tax-Free Retirement Income? One Man’s Whole Life Decision

Whole life insurance might not be something that’s on your retirement planning radar, but for this client, here’s how it served his need to control ta…
February 23, 2021
The Current Plan for $1,400 Checks
Coronavirus and Your Money

The Current Plan for $1,400 Checks

Here's what you need to know about the stimulus check plan currently being considered in Congress for President Biden's COVID-relief package.
February 18, 2021

Recommended

Roth IRA Basics: 11 Things You Must Know
Financial Planning

Roth IRA Basics: 11 Things You Must Know

A Roth IRA can be a great way to save for retirement since the accounts have no required minimum distributions and you withdraw the money tax-free.
February 25, 2021
33 States with No Estate Taxes or Inheritance Taxes
retirement

33 States with No Estate Taxes or Inheritance Taxes

Even with the federal exemption from death taxes raised, retirees should pay more attention to estate taxes and inheritance taxes levied by states.
February 24, 2021
Student Loans: Pay Down or Hold Pat?
Paying for College

Student Loans: Pay Down or Hold Pat?

Before you tell your lender you want to resume payments, consider whether there are better uses for your money.
February 22, 2021
Buying a Burial Plot Is a Grave Decision
Financial Planning

Buying a Burial Plot Is a Grave Decision

Thinking about buying a burial plot can be uncomfortable but making this purchase ahead of time has its advantages, including potentially saving you m…
February 17, 2021