Financial Mistakes to Avoid as a Recent College Grad

 

Mistakes to avoid financially as a recent college grad

Mistakes to avoid financially as a recent college grad

Mistakes are unavoidable, but you should be especially careful when it comes to your finances. As you prepare to graduate college, you also prepare for the “real world.” You’ve spent the last four years obtaining as much knowledge as possible in your field, applying for jobs, and writing your resume. Graduates beware, student loans are the second-highest form of personal debt. And with college debts increasing, it is more important than ever to have a smart financial strategy in place. A solid plan will help you avoid as many mistakes as possible.

By taking a step ahead of your peers in choosing wise investments, you can create healthy habits. This not only improves your personal finances for years to come but also avoid future debt issues.

Financial Mistakes to Avoid after Graduation

Financial mistakes can be easy to make, but there are ways you can avoid them.

Mistake #1: Having no credit.

Everyone talks about saving money, and we are no different. Unfortunately, all this talk about savings has college graduates a little hesitant to take out loans or credit cards. This is due to the fear of creating an overwhelming debt they can’t repay. Plus, not to mention, college already creates heavy financial obligations. Furthermore, it is increasingly harder for those under 21 to sign up for a credit card with no existing income. So, what’s a newbie to do? Build your credit history slowly and regularly by opening accounts and using your own credit cards.  Making consistent payments by or before the due dates establishes a good credit history.

Why this is important: When you want to make big, future purchases, like a house, you will have a hard time being approved for a loan. Lenders may require a co-signer or collateral if you have no credit. When I was still in college, I bought my first car with cash I had saved from my summer job. Not long after graduating, I needed to purchase a new vehicle. This proved to be a challenge due to my lack of credit. Over the years, I have been able to develop a favorable credit score by paying off a credit card and the loan for my vehicle. Had I started to build credit sooner, I wouldn’t have struggled so much to get the car I needed.

Mistake #2: Not having a plan.

Having a limited or non-existent financial plan is one of the biggest mistakes recent college grads make. As a poor college student, you are lucky if you have two pennies to rub together as you battle the choice of groceries or rent. When you land that first job out of school though, it can be easy to fall into poor spending patterns very quickly. To avoid this, cut back on unnecessary expenses like going out to eat.  Spend more time enhancing your cooking skills and spreading out your personal purchases. Instead of buying everything for your new apartment at once, budget your expenses over time. Additionally, focus on always paying bills first at the beginning of every month. Then, you know how much is still available in your accounts to last the rest of the month.

Why this is important: Money adds up quickly. So, developing these positive habits sooner can save you not only hundreds but possibly thousands per year.

Mistake #3: Waiting to save and worrying about finances later.

Consider consulting with or finding a financial mentor to help you along this new journey. Waiting to save or pay off student loan debt can cause major inconveniences in your future. Knowing where to invest savings is also tricky, but a certified financial specialist can help you. Try the Digit.co app to automatically save up and pay debts and also try to contact friends from college with a finance degree who may be willing to provide some advice at no charge as they begin their careers.

Why this is important: The sooner you start paying down those student loan bills, the better your overall financial situation. If you were to plug your debt numbers into this student loan calculator tool, you may be appalled at the time frame it will take you to pay it all off. The minimum monthly payments barely cover the interest. Plus, creating a savings account and emergency fund will keep you out of sticky financial situations.

Mistake #4: Not investing early.

Time is the greatest benefit you can give yourself when it comes to investing. Even if you are only contributing a few hundred dollars each year, compounding interest rapidly grows your investments over time. Instead of blowing any extra cash you receive, put it away to help provide some financial security for the future. Try the Robinhood app for this, this is the best app for beginner investors like you.

Why this is important: You are only working against yourself the longer you wait to start investing and planning for retirement. Even with minimal contributions, you can create a significant amount of money the earlier you begin. With a little forethought, you can provide a security net and a nice retirement fund.

By thinking about your future now, you can avoid these common financial mistakes recent college grads make. At the same time, you are also building yourself a nice, comfortable financial safety net.

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The first week of February marked a distinct change in the shopping habits of consumers across Southeast Asia. Following the Lunar New Year, everyone was on high alert as Covid-19 spread beyond the Chinese borders. Here in Taiwan, the first cases led to school closures, increased doctors’ visits, and families preparing for the worst. In addition, masses of people were ‘panic-buying’ health care products and household supplies.

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How To Save Money on Transportation When Traveling Abroad

How to Save Money on Transportation When Traveling Abroad

Save Money on Transportation

Transportation and lodging account for the largest portions of a traveler’s budget. If you plan a vacation during peak travel seasons, you can count on spending even more money. However, there are several alternative options that you should consider before making reservations. Here are some of the best ways to save money on transportation when traveling abroad.

Trains

Trains are a great way to quickly zip across long distances. You can even save the cost of a hotel if you reserve a sleeper car. Rail passes give you the ease and convenience of traveling to multiple cities for a flat rate. There are variations of them across the world, but the European Rail Pass is probably the most famous. If you plan on visiting several countries, you should definitely look into buying one. Simply enter your destinations and dates, and the search engine will guide you through the itinerary, step by step. Check out their featured routes to save money on transportation when traveling abroad.

If you are more adventurous and prefer to navigate foreign cities on your own, most places have an all access transit card. This gives you an authentic flavor of life abroad since you are traveling alongside the locals. As an added bonus, most buses, subways, and light-rail trains also conveniently pass by the most popular sites. It’s an economical option which lets you  splurge a little on the travel experiences you enjoy most.

Planes

Most travel websites do a fair job of comparing flights among domestic carriers. They also allow you to set up email alerts when prices drop. However, I prefer Skyscanner or ITA Matrix since they include all major international competitors. They have easy-to-use tools that compare prices day by day. With a little flexibility in dates and destinations, you can save a lot of dough. It’s even possible to find flights for pennies on the dollar if you can leave within 24 hours.

You should also check out the TripAdvisor app on your phone since it offers one-stop shopping. It helps you find flights, hotels, restaurants, and things to do all in one search engine. The site is especially helpful on those day when you are looking for something more to do. With a few taps, you can locate the best restaurants and attractions near you. Best of all, it even allows you to customize your search within a set budget!

Automobiles

Renting a car on vacation can be a huge, unnecessary expense. Between the gas, parking fees, and insurance, a rental can eat up a good portion of your budget. However, paying for a seat in someone else’s car can save you hundreds of dollars. BlaBlaCar is a European-based ride sharing app that allows you to carpool with car owners seeking to save gas money. The website is easy to peruse and matches you with multiple drivers in your area. You can quickly compare prices and times of departure. If you are hesitant to jump in a stranger’s car, there are plenty of reviews from previous passengers to verify your driver’s credentials.

Charter buses and long-distance coaches are another great way to reserve your cash when traveling abroad. Coach travel has also changed a lot in recent years. Contrary to the associated stigma, most vehicles are clean, comfortable, and efficient. International service usually provides food, beverage, free wifi, and a restroom on board as well. Upgraded tickets can also get you reclining chairs and memory foam seats. Avoid the hustle of airports and train stations by reserving yourself a seat on board a coach and save money on transportation when traveling abroad.

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