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Finance 101 for New Graduates
by Candace
Bahr, CEA,
CDS
 It’s June, the traditional month
of graduation, a time for new beginnings.
As you join the world of work, realize
that you have a tremendous power to
shape your financial future. That’s
because you hold the greatest of all
assets---time! The ability to
set goals and know what needs to be
done to reach them begins the exciting
journey toward financial maturity.
Budgeting for the Young
and Restless
Budgeting, yuck! If you’ve never
attempted a budget before, the whole
idea may seem frightening and unpleasant. But
viewed from the proper perspective,
budgets are a power tool that gives
you more enjoyment from the money you
spend. While budgets can help control
spending, they can also help with saving
for particular goals. And within
the basic guidelines, budgets can be
flexible. You can decide where to expand
and contract discretionary spending. Plan
your finances rather than spending
recklessly, and you’ll be happier,
and your money will go farther.
Managing the Credit
Monster
Students today are offered a dizzying
array of credit opportunities that
can strain their finances to the breaking
point if not approached with caution. The
credit card companies are in the business
of extending credit. They count on
you, the cardholder, not to take on
more debt than you can handle and to
take good care of the FICO score that
can determine your future borrowing
power. Knowing how best to use
credit and how to avoid abusing it
can literally save your financial life. Don’t
take on more credit card debt than
you can comfortably pay back within
the coming year.
Saving and Investing
With Father Time
The future can seem too distant to
be real when money is needed today
for rent, transportation, meals, and
more. But here’s an example
of the wisdom of saving and investing
for tomorrow rather than spending “in
the moment.” A $10,000
investment earning 8% will grow to
$20,000 in 9 years, and in nine more
years you’ll have $40,000, then
$80,000, then $160,000. Don’t
have $10,000 to invest? Try $100 a
month. Compounding of earnings is so
powerful that those who begin in their
twenties can amass large nest eggs
with relatively little effort as long
as they invest regularly. Money
left to grow over years and years can
be your ticket to a lifetime of financial
security. Even if the initial
investment is small, time is on your
side.
Congratulations, graduates! Use your
financial power wisely, and you will
have a bright future ahead of you.
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