Published in: Banks | July 1, 2019
5 Ways to Save Money Your First Year Out of College
By: Maurie Backman
Saving money as a new grad isn’t easy -- but it can be done. Here are five easy ways you can add to your savings account. Image source: Getty Images
Your first post-college year can be a tricky one. You must navigate life as a working adult, but you’ll probably be tackling your student debt on an entry-level salary, too.
That may not seem like a winning formula for boosting your savings, but if you commit to building some cash reserves, you’ll be surprised at how easily you can meet that goal.
Here are a few things you can do to save when you’re first starting out:
1. Follow a budget
It’s hard to save money when you have no idea where yours is going month after month. That’s why having a budget is crucial.
Start by listing your recurring monthly expenses, like your
- rent payment,
- student loan payment,
- utilities, and
- anything else you pay for regularly.
Then factor in once-a-year expenses to ensure that you’re saving for them month after month. Finally, compare your total spending to your take-home pay. If there’s money left over for savings, you’re in good shape. If not, you’ll need to trim some other expenses to eke out cash.
2. Live with your parents
Living with your parents might seem like a step backward socially -- and even emotionally. But it’s a great way to save money when you’re first starting out in the workforce. If your parents don’t charge you rent, the money you save could go into a savings account. It’ll earn interest and be there for you when you need it.
Living at home may not seem like a good long-term arrangement. But doing it for even a year after college could really help your savings efforts.
3. Get a second job
Working a full-time job is hard enough, so the idea of getting a second one may not be appealing. But the money you earn from a side hustle is yours to use as you choose. You’ll have the option to save every extra penny you bring in.
And your second job doesn’t have to be a dull one. You can take a hobby you enjoy and turn it into a money-maker or even explore a different field you’re interested in.
4. Stay out of credit card debt
Save money by not throwing money away on credit card interest. If you manage to stay out of credit card debt, you won’t have a portion of your income monopolized by a monthly payment, and you won’t rack up interest.
If you’re going to use a credit card, make sure you pay off your balance in full every month by the time it comes due. If you don’t trust yourself to do so, you may be better off sticking to cash.
5. Hide money from yourself
It’s hard to spend money you don’t know you have. One final way to ramp up your savings game after college is to automate the process. Arrange for a portion of each paycheck to be sent directly into savings so it never lands in your checking account. This way you’ll remove the temptation to blow that cash.
Saving money out of college is a challenge, to say the least. But there’s good news. You can use numerous tricks to boost your personal cash reserves, and once you do, you’ll be happier for it.
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