How to Create and Manage a Budget After Graduation

Graduating college is a laudable endeavor as you’ve pushed through grueling classes, tests, and assignments to achieve your educational goals. What awaits you as you begin your career and live your life independently? You may need to revise or even create a budget post-graduation, which is especially important for those who are living on their own for the first time. Student loans, bills and all of the other costs associated with living on your own are all important things to consider as you move away from college life.


Paying Off Student Loans

One of the most important budgetary items for a recent graduate is student loan repayment. Student loan debt will likely follow you for your whole life if you fail to pay it off. Ensure that you understand where your student loans leave you, prioritize them over anything else and try to create a long-term plan and goal to get them all paid off.

Make sure to make each monthly payment towards your student loans in a timely manner and try to pay more than the minimum. Paying more than the minimum due will help you pay off your loans quicker and lower the amount of interest your loans will accrue.

Creating a Budget

As you create a budget you need to consider both your income and your expenses. Your expenses include things like utility bills, rent, grocery bills, phone bills and entertainment. As you create your budget, make sure to include every little expense – even the smaller payments such as a $10 subscription fee to a video streaming service.

After creating a list of your expenses, you should compare them to your income. If you are earning less than you spend, then you will need to reconsider your expenses. Because you will have already created your expense list, you will be able to quickly review where your money is going so as to determine what expenses you can eliminate.

Paying Off Debt

You should also review any debts you have besides your student loans. If you have credit card debt or an automobile loan then you need to make a solid plan to pay them off within a set time span. The longer you have a debt, the more interest you will pay in the long run. Based on your income and expenses you should set a goal time by which to have paid off your debt.

Cut Down on Your Expenses

In order to pay off your debts and afford essential items, you should look for ways to cut down on smaller expenses for non-essential items or services. Don’t buy what you don’t need, such as a new phone or brand name snacks. Consider unsubscribing from any online subscriptions you may have. Rather than eating out every day, learn how to cook less expensive meals at home.

Using Apps and Tools to Track Expenses

Creating a budget spreadsheet can help you to easily and quickly track your income and expenses. Take advantage of the different types of budgeting apps and services available – many of which are free! These will help you keep track of what you are spending on, what your income is and help you set both short and long-term financial goals. Some examples include Mint and PocketSmith.

Pay Your Bills On Time

Always pay your bills on time or a couple days early, if possible. If you have trouble remembering to pay bills, create a monthly reminder on your phone calendar or automate your payments to ensure that these are paid.

If you do not pay your bills in a timely manner it can have a very negative effect on your credit, which can lead to you paying higher interest rates on loans or credit cards. In addition, employers, landlords, and insurance agencies oftentimes check a person’s credit which means that if you fail to pay your bills on time, it can affect whether or not you get a job, an apartment or an insurance plan.

Setting Aside Savings

Because life is unpredictable, it’s important to set aside an emergency fund of money. Having an emergency fund will prepare you financially for dealing with sudden and unexpected bills or expenses. If you lose your job, an emergency fund can provide you with a financial cushion until you find a new source of employment. You should consider keeping your emergency fund in a separate savings account so that you are not tempted to spend it on non-emergencies.

As a recent college graduate, the idea of creating a budget and dealing with your finances can seem overwhelming. However, sitting down and creating a plan for paying off debt, managing your expenses and creating savings can help you to stay organized and pay things off in a timely manner. By doing these things you will establish a good credit record for yourself and create a solid financial foundation for your future.


Maricel Tabalba is a freelance contributor for who is interested in writing about personal finance advice for Millennials and college students. She earned her Bachelor of Arts in English with a minor in Communication from the University of Illinois at Chicago.


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