8 Things New Grads Don't Yet Know About Saving Money

If experience is indeed the best teacher, then 2014’s new grads are learning a lot of valuable lessons about money management as they settle into the real world. However, waiting to learn everything on your own can prove costly.

Here are eight things that most new grads don’t yet know about saving money -- but should. The payoffs can be significant and immediate.

1. You can cut the interest rate on your federal student loans by 0.25 percentage points immediately with one simple step. If you sign up to make your monthly loan payments via automatic debit, your interest rate drops. It’s that easy.

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2. You can save big by moving on certain days of the week. The next time you pack up, whether it’s for a new apartment across town or a new job across the country, save 10% or more by moving midweek, rather than on busier weekend days. If possible, avoid the busiest season for movers: Memorial Day through Labor Day.

3. You can save on your 2014 tax bill next spring by deducting your moving expenses if you had to move more than 50 miles from home for a job this year. In 2014, you can deduct 23.5 cents per mile plus parking and toll expenses if you drove your own car.

4. You can cut even more from your 2014 tax bill by deducting interest paid, up to $2,500, on your student loans this year -- even if Mom and Dad made the loan payments on your behalf! As long as your parents won’t be claiming you as a dependent on their taxes, the IRS treats the money from parents as if it were given to the child, who then paid off the debt.

5. You can earn more interest and pay fewer fees with an online bank instead of banking at traditional brick-and-mortar branches, as your parents did. Barclays online bank offers 0.9% interest for savings accounts, and Ally Bank offers 0.87%.

6. You can easily fall into a trap of not saving enough for retirement in your company’s 401(k) plan. Many employers will auto-enroll new employees in the company 401(k) plan at a default savings rate of 3% of your pay. Sounds great, right? The problem is, experts suggest that you save 12% to 15% of your income for retirement.

7. You can save big on taxes in the long run by contributing to a Roth IRA now. Your contributions to a Roth are taxed now, when your relatively low income has you paying a relatively low tax rate. The money then grows tax-free and is ultimately withdrawn tax-free in retirement, when your tax rate may be much higher than it is now.

8. You can make smaller federal student-loan payments -- and even have some of your debt forgiven -- if you don't earn much money. Income-based repayment plans, such as Pay As You Earn, are available for borrowers who have a lot of debt relative to income. The plans allow you to put 10% of your “discretionary” income (the amount by which your income exceeds 150% of the poverty line) toward your loans over 20 years, after which any remaining amount is forgiven.