For The Youth: Six Tips That All Recent Graduates Should Consider 

Within the United States, student debt is at an all time high. One could live under a literal rock, yet still be aware of the fact that millions of youth currently live in debt as a result of their loans. The number is so staggeringly high that it actually eclipses the total debt owed for credit card payments and auto loans!

Unfortunately, even the talented CPAs at Accounting Solutions Ltd. are unprepared at dealing with a problem on this immense scale. On the flip side, we do have the means to help out individuals and small business owners looking to make the right decisions along their investment journeys. With over 25 years of experience, we are always more than happy to give our clients personalized advice so that they leave satisfied and, even more importantly, are financially prepared for the future.

In lieu of the abundance of student debt that is affecting our country, we have put together some handy tips for those fresh out of school. If you are hoping to pay off your initial investments while continuing looking towards a bright future, read on:

  1. Save Now, Not Later: While you may have a massive debt to pay off, don’t let that be your number one priority. Rather than putting aside all of your savings to pump directly into these payments, remember that, at the end of your career, you will want to retire comfortably. If you have managed to use your education in order to procure a decent living, try to put aside at least 10 % of your earnings. If your employer offers a 401(k) plan, this small piece of your income can build up exponentially over time thanks to the miracle of compounded interest.  For all those panicking and hoping to rid yourselves of debt quickly, well, you definitely have your priorities in the right place. Just be mindful that your future beyond student debt is something worth investing in as well.
  2. Budgeting Is Key: Student loans give many college and university students their first introduction to a world where they have disposable income. In many cases, this leads to big tabs at the campus bar. One thing that students and graduates must come to terms with is not self control, but budgeting. After school ends and employed living starts, it is essential that one learns how to assess their financial priorities so as to plan accordingly. Food, transportation, and housing are not cheap, even for medical school graduates with big salaries. We strongly recommend that those unfamiliar with budgeting try out some of the myriad of mobile phone apps out there, such as Mint or Acorns. These personal finance tools are easy-to-use, free (for basic versions), and can be tailored towards those who try not to break the bank. As a general rule, try not to let your regular, recurring expenditures become more than 50% of your income.
  3. Invest Wisely: As graduates continue along the road of life, and start to eradicate their debts, the next logical step along their path to financial success revolves around investing. For this step, we do advise that you speak with a financial or investment advisor, rather than us accountants, as they will be able to provide information that is directly relevant to your situation. At the end of the day, you are going to want to construct a portfolio that is diverse, and also able to withstand the amount of risk that you are willing to consider. Keep your financial objectives, as iterated in the last two points, at the forefront of your saving, but start to diversify where your money goes, so that your wealth grows.
  4. Gambling Isn’t Worth It: The focus of every type of gambling is money. Don’t let your personal wealth overlap with this shifty realm in any way, shape, or form. Even if you find yourself in monetary straits, never make any decisions that will put you at greater risk. Scammers are everywhere, and some have learned to take advantage of those down on their luck.

To help safeguard yourself from scams and the dangers of putting your money in uncertain places, make sure you have a full understanding of all of your investments. Even if your financial advisor is recommending that you put some money into a stock, you should be the one making the decisions and pulling the trigger. Only do so after you have performed some in depth research of the investment in question. Being doubtful can work to your benefit in many scenarios, and, if you choose your advisor well, you can hope to foster a trustworthy relationship, which will help drop your stress levels exponentially.

Gambling doesn’t only take place in the casino – planning your taxes poorly, choosing the wrong insurance provider, or mismanaging your budget are all forms of gambling with your money, and they can result in some serious loss.

  1. Living Situation: Choose Wisely: Deciding whether you are going to save up to purchase a home, or rent indefinitely, is a very difficult choice, with too many different factors and outcomes to count. While renting can save you money in the short term, putting a down payment on a home can give you a valuable asset down the road. Choosing between these two options depends on a mix of preference, goals, and location. Prior to making any hasty decisions, be sure to talk to your CPA and financial advisor, they can help you see the big picture and steer you in the right direction.
  2. Keep Learning, Keep Earning: Although it may be hard to see the light from behind your pile of student debt, never forget the importance of education. By keeping your priorities straight, you will be able to emerge from your financial rut so as to continue to enhance yourself in the professional world. Always keep an open mind, a wary eye on your money, and commit towards building a future for yourself, and good things will come. A great way to cement your success is to continue educating yourself. Whether by pursuing a professional designation, or simply joining the chess club, there are boundless opportunities out there that you can use to help keep yourself sharp, and your pockets full.