- If you are working on saving/investing, avoid overpriced conveniences like food delivery and emotion-drive online shopping.
- Social media and commericials will not help you make sound financial decisions. You do not need to live like an influencer. You are not in a competition and must continually make decisions that support what you can financially sustain now and accomplish in the future.
- Learn about investment strategies in our Investing and credit development for college students Money Talk or in one of our Comprehensive Personal Finance Financial Fitness sessions.
- Deposit money into your bank accounts directly from your paycheck before you spend it. Have a portion go to savings, another portion go to checking, and do not touch the savings. This is one of the most effective ways to save and a little can add up over time.
- Do not plan your saving around your spending. Plan your spending around your savings. Start with putting away a few percent of your earnings and increase the percentage periodically. For you to be financially successful, you must continually live on less than you make and make choices that support this.
- Make your money work for you. Don’t wait until you are debt-free (unless it is high-interest debt) to start investing. If you start investing young and pay yourself first, you will not regret it due to the wonders of compounding interest!
- As you start your career, a #1 rule (beyond having an emergency funds) is to contribute up to the amount that your company will match in your retirement account (IE: 401k). This is free money and can be looked at as a non-performance-based bonus. A typical 50-100% company match should be looked at as an immediate 50-100% return on your investment.
- Actualize your Life Plan: Determine how much you want/need to save, for how long, and when you will need it. Use investment and retirement funding calculators to determine what you need to do to accomplish these short- and long-term financial goals.
- If you are working during college, you may want to research opening a Roth IRA, which is a retirement account that provides you with a tax-free stream of income in retirement.
- Use a budget to help ensure that you can cover your expenses and still support your financial goals. Overestimating expenses and underestimating income helps. Please refer to the budgeting section for more information.
- Statistics show that consumers are likely to spend 15% more using credit cards than if they only used cash. Analyze your spending closely and always rethink the purchase before you use the card.
- Start developing an emergency fund to ensure that emergencies do not impact your life plan goals. Credit cards are not for emergencies. An emergency fund keeps money in an account so that you have quick access to it. College students can start small at first, but you need to work up to saving three months of whatever your expenses are. If you start a family and/or own a home, you are going to need to increase that to closer to 6 months of expenses.
