Financial Tips for Graduates
To all of this year’s May high school and college grads, congratulations! You’ve crossed the threshold to an exciting new phase of your life. No matter what’s next for you, it’s more important than ever to start thinking about your financial future. Financial responsibility is extremely important. Here are five financial tips for young adults to help you make the most of your money.
1. Create a budget.
One of the most important things you can do as a young adult is to create a budget. A budget helps you track your income and expenses, so you can better manage your money. Be sure to include all of your monthly expenses, such as rent, utilities and groceries, and compare them to your income. You can use the budgeting tools right in your Cadence Bank online banking experience, track your spending, set savings goals and measure your progress! We make it easy.
2. Build an emergency fund.
From flat tires to busted smartphones, unexpected expenses can happen to anyone. Having an emergency fund can help you weather financial storms. The amount you need to have in an emergency savings fund depends on your situation. Think about the most common kind of unexpected expenses you’ve had in the past and how much they cost. This may help you set a goal for how much you want to have set aside. Start small by setting aside a little bit of money from each paycheck, and watch your emergency fund grow. You might be able to automate your savings through direct deposit of your income by splitting it into a checking and savings account.
3. Start investing early.
Investing early is one of the best things you can do for your financial future. Even if you can only invest a small amount each month, starting early can help you take advantage of the power of compound interest. Of course, investing may come with risk, so speak with a financial advisor to understand the different investment options and their levels of risks and potential returns. Don’t count on getting rich overnight with “meme stocks.”
4. Live below your means.
It’s easy to get caught up in the desire for the latest gadget or the newest trends. But it’s important to remember that living below your means can help you achieve more financial stability and freedom sooner. Focus on building a solid financial foundation. It took self-discipline to graduate. That same self-discipline can help you say “no” to impulse buying or living above your means.
5. Take advantage of employer benefits.
If you have a job, be sure to ask about any and all employer benefits that are available to you. The obvious ones may include things like health insurance, retirement savings plans, or tuition reimbursement. But some companies also have corporate discount codes, coupons or even whole platforms dedicated to saving you on electronics, your phone plan, automobile purchases and much much more. All of these benefits can help you position yourself for financial success in the long run.
Sitting down to work out a budget and plan your finances might seem like an anxiety-inducing activity sometimes, but a little work now can pay off later. By taking action, you can set yourself up for success. Remember: create a budget, build an emergency fund, manage your debt, start investing early, live below your means, and take advantage of employer benefits. By following these tips, you’ll be well on your way to a bright financial future.
Sources: FDIC, Forbes, Consumer Finance Protection Bureau
This article is provided as a free service to you and is for general informational purposes only. Cadence Bank makes no representations or warranties as to the accuracy, completeness or timeliness of the content in the article. The article is not intended to provide legal, accounting or tax advice and should not be relied upon for such purposes.