Education isn’t over once the diploma is in hand, warns Cathy Weatherford, president and CEO of the Insured Retirement Institute (IRI).
Learning the best ways to handle money is an ongoing process, and, said Weatherford, in the current challenging times, “College graduates … will need to be smart and savvy … to maximize their paychecks and their savings.”
Pointing out that research has shown a link between financial knowledge and both financial planning and savings levels, she said that the best thing parents and financial professionals alike can do for graduates as they head out into a tough job market and tougher economic climate is to provide them with the resources and information they need to make decisions that will carry them through—not just now, but “throughout their lives.”
To that end, IRI has offered Weatherford’s top 10 suggestions on how to be smart with money at home and on the job—now and in the future. (Also, check out what the 15 Best Paying College Degrees are at AdvisorOne.)
Here are Weatherford’s tips for graduates:
1. Making a budget, making savings a part of that budget and then sticking to it is the single most important piece of advice. Said Weatherford in an e-mail, “Above and beyond anything else, it’s imperative … No matter what age, regardless of profession or salary, no one can afford to live beyond their means. And their budget has to include savings. Many people will try to do this backward and save whatever is ‘left over’ after paying for everything else. All too often the result is having nothing saved for the future. Making savings a budget priority is the only way to make sure that there is something socked away.”
2. Pay off debt; don’t increase it. Tackle those obligations with the highest interest rates first, and get rid of them as quickly as you can. Be savvy on the terms of student loans, and have a plan to pay them down.
3. Don’t carry a credit card balance. Pay it off every month so that its high interest rates can’t extend debt and scuttle other plans.