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Life after college: staying ahead of the financial curve

Author: Andrea Fisher
Published: Jun 22 2013

College graduation is a time of relief and celebration. The world of academia is at a close, meaning there are no more crammed study sessions; university meal plans or organized living arrangements. In other words, a life of predictability is now replaced with one much more complex and demanding. With diploma freshly in-hand, graduates must find financial success in an economy that is still on the mend.

Regardless if you venture outside of the confines of a typical nine to five position, financial success depends on practicing disciplined habits and personal perseverance. Recent college graduates have the opportunity to start making wise decisions now - before creating a snowball of financial blunders.

For starters, leave the credit card alone- even cut it up if need be. Credit cards are a good thing to have in order to establish positive credit and for the occasional emergency, but for anything else, they can quickly become a beast that spirals out of control.

We live in an economy that is not yet completely recovered from the Great Recession of 2008—and one phrase stands above the rest: “Cash is king.”

Ensure your financial success by following some basic tips— you won’t regret them later.

Open a bank account

Having a personal checking/savings account provides a safe and convenient way of storing and accessing money. A bank account minimizes the chances of monetary loss or theft. Most banks are insured by the FDIC, and also have elaborate security systems to safeguard investments. In establishing a good banking relationship, it becomes easier to apply for mortgages and other loans.

Assess your spending habits & curb them

Keep a record of your spending habits. Where does most of your money go towards, and how do you typically pay for items? If by cash, try carrying as little as possible, and instead, use a debit card. If by credit card, try keeping it at home and focus on making payments that are above the minimum amount. Simply alleviate your financial weakness by not having the temptation readily available.

Know when to use your credit card

According to the Federal Reserve, the average credit card debt per U.S. Household in 2012 was a staggering $15,799. Of the 2012 figures provided by the Federal Reserve, the average college graduate owes $20,000 in debt. This said, it is imperative to know when to use credit, but given the right circumstances, credit cards can be a useful tool if used wisely.

In-general, it is best to stay within 30% of your credit limit. Credit scores are partially based on the amount of accumulated debt. In keeping a relatively low credit card balance, good credit scores are earned.

Save for a rainy day (they do happen)

In recent years, Americans have become less inclined to save. But for recent graduates, not saving, especially now, could have some devastating effects. A survey provided by the National Association of Colleges and Employers (NACE) reported that businesses plan to only hire about 2 percent more college graduates than they did in the class of 2012. Of these, the greatest job demands were in fields in business, engineering, computer science and accounting. The job market remains competitive while finances steadily rise. Quite frankly, everyone- recent college graduates or not, should be saving. A rainy day simply happens when 'the sun don't shine.'

So class is out, and wallets may be filled with recent graduation money, but remember a new identity; a new role; and a new start waits. It helps to be financially successful while finding it all.

Guest contributor Andrea Fisher is an online marketer and content specialist from North Carolina. She is a published journalist & blogger with an English degree and political science minor from the University of North Carolina at Greensboro.

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