Gen Y – Finances of the Recent Grad
Its graduation time everywhere. Opulent convocation ceremonies, salty graduation speeches, many congratulations…and expectations. After the pomp and stance is said and done, it will be time to buckle down and start that entry level job with its entry level pay.
This is an exciting time for the Gen Y generation, although, reality can be harsh. Life is expensive. Coupled with those student loans, many find it challenging to balance their budget. Here are a few tips to help get those newbie employees started on the right financial path:
- Get yourself a budget book. Forbes suggests Generation Earn: The Young Professional’s Guide to Spending, Investing and Giving Back, by U.S. News & World Report senior editor Kimberly Palmer.
- Pencil out a budget. The key word is pencil. It will take a few months to get used to a steady paycheque, and those steady bills. Bottom line, spend less than you make.
- Move in with your parents. This will keep housing costs down. Use the money you are saving to cut down on the student loan debt.
- Steer clear of debt. While working on paying down student debt, it is a crazy idea to add more.
- Pay down your student loans as quickly as possible.
- Have an emergency fund. Set this up as a top priority. A tax-free savings account is a great place to stash this slush fund.
- Start investing. It is never too soon.
- Put money in an RRSP each year.
- Get your life insurance. The earlier the better on this one.
- Don’t forget to have some fun! The best way to invest in your emotional health is to have fun – and there are plenty of inexpensive ways to do that. After all, fun should require more time and energy than money.
Source: Forbes Magazine