Financial Tips for College Grads
After graduation many young people these days can be a very difficult time. They have to find a job, a place to live, and get set up in the world. Even once they get their job, their place to live, and get established in the world, money can still be tight.
The first thing that a college graduate should do after graduation is start saving. The graduate needs to make a plan of saving money and stick to it. This will help if an unexpected event occurs down the road.
The next step would be to start a Roth IRA. You want to make sure that you get a tax free Roth IRA. This way you can save money that you have already paid taxes on. The interest will always be tax free. This saves money in the long run, by paying taxes upfront at the current rate; you do not run the risk of having to pay higher taxes later on.
You should set up a payment plan to automatically put money into you Roth IRA. Many people choose not to do this, thinking that they will add money to it on their own, and then never do. This is a way to insure that you will be able to save money and get it put into your Roth IRA. There are a lot of people who automatically feed their 401(K), but never think to do this with their Roth IRA. They should think to do this though, because it will help to save money.
The new graduate should also invest in index funds. The best way is to stick with a low cost index fund. These index funds are a very simple way to invest. With index funds you do not have to deal with all the anxiety and cost of having to try to predict which stocks, bonds, or mutual funds that will do best in the market.
Research starter funds; find one that is best for you. There are many different kinds out there, and you have to look into all of them. Get together some questions you may have and get answers. The more you look into each one, the more information you will have to make the best decision for you. Everyone’s needs are different, so what is best for one person may not be best for another.
These are some tips to help new graduates. This will help them save money and make some money. They should try to do all of these tips, but even one or two of them would help in the long run. If you need help there are plenty of banks and credit unions that can offer services to help you.