If you have recently graduated from college or know someone who has, now is a great time to start building a solid financial foundation. Here are five ways to get started.
1. Review your budget
As your expenses and income change, so will your budget. You might have a new category to add: student loan payments. Talk to your student loan servicers about repayment options. If you’re planning a career in public service, you may qualify for federal student loan forgiveness.
2. Start a savings account
In terms of how much to save, aim for $1,000 to start. From there, you can work your way up to saving three- to six-months’ worth of expenses to cover unexpected costs.
3. Establish credit
Applying for a credit card helps you begin to build a positive credit history. The key is using it responsibly, meaning that you pay your bill on time each month and maintain a low balance.
When looking for your first credit card, compare annual percentage rates (APRs), fees, and rewards to make sure you choose the one that best fits your spending style.
4. Apply for an auto loan
Do your research before car shopping, starting with determining what you can afford and how much to save for a down payment. The more money you can put toward the purchase, the less you’ll have to finance, which saves you money.
When looking for an auto loan, review the interest rates, fees, and terms to determine the best deal for your financial situation. You may qualify for recent graduate offers, too.
5. Take advantage of work perks
If you have a job, be sure to sign up for benefits, especially a 401(k) or other retirement plan, and health insurance. If your employer offers a match on their retirement plan, be sure to contribute enough to qualify for it.
MSUFCU offers free financial education to community members of all ages, covering topics such as budgeting, understanding credit, paying off debt, planning for retirement, and more. We also have our Savings Builder™ account, which allows members to save faster by earning more dividends on initial deposits. To learn more, visit msufcu.org/savingsbuilder.