10 Tips for This Year’s College Grads

What's Hot

2 Types of Black Marks Might Vanish From Your Credit File SoonBorrow

6 Ways the Obamacare Overhaul Might Impact Your WalletInsurance

7 Dumb and Costly Moves Homebuyers MakeBorrow

This Free Software Brings Old Laptops Back to LifeMore

Obamacare Replacement Plan Gets ‘F’ Rating from Consumer ReportsFamily

Beware These 12 Common Money MistakesCredit & Debt

21 Restaurants Offering Free Food Right NowSaving Money

17 Ways to Have More Fun for Less MoneySave

House Hunters: Beware of These 6 Mortgage MistakesBorrow

30 Household Uses for Baby OilSave

25 Ways to Spend Less on FoodMore

Nearly Half of Heart-Related Deaths Linked to These 10 Foods and IngredientsFamily

5 Surprising Benefits of Exercising Outdoors in WinterFamily

10 Ways to Save When You’re Making Minimum WageSave

Boost Your Credit Score Fast With These 7 MovesCredit & Debt

7 Painless Ways to Pay Off Your Mortgage Years EarlierBorrow

The Most Sinful City in the U.S. Is … (Hint: It’s Not Vegas)Family

The True Cost of Bad CreditCredit & Debt

10 Companies With the Best 401(k) PlansGrow

This Scam Now Tops ID Theft as the No. 2 Consumer ComplaintFamily

6 Stores With Awesome Reward ProgramsFamily

6 Ways to Save More at Lowe’s and The Home DepotSave

6 Healthful Treats for Your DogFamily

New Study Ranks the Best States in the U.S.Family

Thousands of Millionaires Moving to 1 Country — and Leaving AnotherGrow

Strapped for College Costs? How to Get the Most From FAFSABorrow

6 Overlooked Ways to Save at Chick-fil-AFamily

Ask Stacy: What’s the Fastest Way to Pay Off My Mortgage?Borrow

Where to Sell Your Stuff for Top DollarAround The House

8 Ways to Get a Good Price on a Shiny New AutoCars

Ask Stacy: How Do I Start Over?Credit & Debt

Secret Cell Plans: Savings Verizon, AT&T, T-Mobile and Sprint Don’t Want You to Know AboutFamily

30 Awesome Things to Do in RetirementCollege

14 Super Smart Ways to Save on TravelSave

The Rich Prefer Modest Cars — Should You Join Them?Cars

You’ll Soon Pay More to Shop at CostcoSave

10 Ways to Save When Your Teen Starts DrivingFamily

If you're a recent grad or know someone who is, here's a checklist that will help start life on the right financial foot.

This post comes from partner site LowCards.com

This summer, millions of college graduates are transitioning into life as an independent adult. Even though many have longed for this freedom since they became teenagers, they may not be ready for the financial responsibilities.

Weighed down by credit card debt and student loans, many young adults are already far behind in their finances before they even get started. According to a recent study (PDF) by the John J. Heldrich Center for Workforce Development…

  • Approximately 6 in 10 (59 percent) graduates owed money after graduation for student loans.
  • Recent college graduates entered the working world with an average debt of $20,000, almost as much as the median starting salary ($27,000) for students graduating from four-year colleges in 2009 and 2010.
  • About half (49 percent) of students who graduated in 2009 or 2010 haven’t paid off any of their debt. Of those students that graduated in 2006 or 2007, 46 percent have only paid off about one-quarter of their debt, while another 14 percent say they have not paid off any of their loans.

“Now is the time for these young adults to take control of their money,” says Bill Hardekopf, CEO of LowCards.com and author of The Credit Card Guidebook. “Debt seems overwhelming now, but it can get much worse and ruin your credit score. The good news is this is the best time of your life to establish good savings and spending habits. For most graduates, this can be a time when they can live cheaply and flexibly and develop a stable financial footing.”

Here are 10 tips for a good financial start…

1. Budget everything and put every dollar in place. Start with the income that you deposit after your income taxes, health care, and retirement are taken out. This is the real amount that you have to spend each month. Expenses always seem to cost more than you estimate and this underestimating can be a budget buster. Track your spending for a month to get an accurate understanding of where your money goes.

2. Start saving immediately from every paycheck, even if it is only a small amount. Open a retirement account at work or your own IRA. Time and compounding interest will help your small amount grow into significant savings by retirement.

3. Know everything about your student loan. Find out when the payments begin, who owns the loan, and the loan’s interest rate. If you have a little extra cash, you can even prepay your college loans.

4. Pay off credit card debt. If you carry a balance, don’t use it for new purchases. If you can’t afford to pay for the item with cash right now, don’t buy it with a credit card.

5. Set a payment schedule. If you are not trained in paying bills, it is easy to misplace a bill or pay it late. Late fees compound the problem and paying late can lead to lower credit scores. The easiest way for young people to pay bills is to do so online with scheduled email reminders of payments.

6. “Study” to improve your credit score. Your credit score is more important than just about any grade you received in college. It is the number that lenders, employers, and even renters will use to judge you. A high score will help you receive the lowest interest rates and save money on auto, credit card, and mortgage loans.

Pay your bills on time. Keep your credit card balances under 30 percent of your credit limit. Build a long and solid payment history with your credit cards. Monitor your credit history with free annual credits reports through annualcreditreport.com. Obtain a free credit report from each of the three credit agencies: Equifax, TransUnion, and Experian.

7. Use graduation gift money to start an emergency fund. This should be used only for times of unemployment, medical emergencies, or a sudden uninsured car or home repair. The goal should be enough for six months of living expenses. Credit cards are not a safety net because interest rates and fees will significantly increase your problem.

8.  Don’t buy everything at once. Prioritize and purchase only what you need right now. Spread your purchases over time. Don’t let splurges become habits. It is easy to let manicures or sporting events become an expensive part of your lifestyle.

9. Know the warning signs that you are heading for financial trouble. Warning signs could include: credit cards being charged up to the credit limit; your debt growing each month; bouncing checks; and getting calls from creditors. If you have any of these signs, take action now. Track your spending, and plug up the money leaks. This is a good time to talk with your parents or a credit counselor about living within your income.

10. Parents must start early to prepare their students for financial independence. Put your college kids on a budget. Give them a fixed amount of money every month that is just enough to cover their expenses each month and they will learn to control their spending – a skill they must have when they are on their own.

“Financial education starts at home,” says Hardekopf. “You can’t assume your kids will learn all they need to learn on their own. This is not something to learn by making mistakes.”

Stacy Johnson

It's not the usual blah, blah, blah

I know... every site you visit wants you to subscribe to their newsletter. But our news and advice is actually worth reading! For 25 years, I've been making people richer without making their eyes glaze over. You'll be glad you did. I guarantee it!


Read Next: Costco Releases Dozens of New Deals

Check Out Our Hottest Deals!

We're always adding new deals and coupons that'll save you big bucks. See the deals to the right and hundreds more in our Deals section.

Click here to explore 2,003 more deals!