Money Advice for December 2022 College Graduates

You will now be entering a world of unknowns. A world where you can’t get by on intelligence alone. To become successful, you’ll need to take calculated risks, learn from failures, build effective relationships, and thrive in a world where the exact path isn’t laid out for you.

Letter to New College Graduates About Money

A person in their early-to-mid 20s has just started or is interviewing for their first “real” job. For individuals in this situation, you have one massive advantage on your side. TIME. Below is my advice.

Minimize Lifestyle Inflation

Deciding to limit lifestyle inflation before you make decent money will set you up for financial success in the future. Still spending money on the things that are important to you, but do it in a very intentional way.

Automate Your Finances

Automating your finances can be a substitute for a budget if done right. This approach will require more self-discipline, so you’ll have to know yourself before going this route. Having a little money in savings will help when you spend more than anticipated.

Start Investing in Retirement Accounts

If your company does not offer a 401(k), pension, or another related account, consider putting money into an individual retirement account (IRA). Get started even if you can only invest $25 a month. Getting started will put you in the habit of investing to hopefully increase your contributions as you reduce debt or increase income.

Pay Off Your Debt

The important point is even if you aren’t paying debt immediately, do your best to set the foundation so you can increase the gap between income and payments as your income increases.

Money Advice for Recent College Graduates

The good news is you have time on your side. Set a strong financial foundation now! Make a promise to yourself to keep lifestyle inflation low if your income increases in the future. Automate your finances, so you don’t ever see the money to savings or monthly payments.

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