The ONE Thing Every Grad Needs to Know About Money
Updated: Mar 22
Congratulations class of 2020! I know this is a weird time in the world, and you’re probably facing a lot of uncertainties. When I graduated college back in 2007, the economy was on its way down, I was going on job interviews, my credit score was in the low 600s and my car was on its way to being repossessed.
In other words, I had no freakin’ clue how to manage my finances.
Now, 13 years later, the economy is 🥴, but now I have a credit score in the low 800s and a six-figure net worth that is rapidly growing. Oh, and I paid cash for my car.
I’m not saying this to brag. In my 20s, I made every financial mistake in the book until I finally got it together in my 30s.
I don’t want you spending your first adult decade getting into debt or squandering your hard-earned money.
I want better for you.
Sure, I could give you a list of ways to cut expenses and budget your money (insert avocado toast reference), but I firmly believe having a money mindset is your single most valuable tool.
So here is the best financial advice for young adults this elder Millennial can give to the Gen Z Class of 2020:
YOU are Your Most Important Bill
Perhaps you’ve heard of the phrase “pay yourself first.” That doesn’t refer to buying the things you want first. It means when that paycheck hits your bank account, you put a percentage of that money towards your savings/investments FIRST.
Everything else comes second to you.
Before you pay your rent, before you buy groceries, before you pay your student loans, before any of that stuff. Pay yourself (meaning your savings) first.
I know what you’re thinking...if rent is due and I need to eat, how...why would I do this?
Because if you don’t make yourself, your future, your life goals your #1 priority, then you’re going to scale down your dreams and scale up your expenses (i.e. lifestyle creep).
Paying yourself means when it’s time to go apartment hunting, you’re not going to scale up and pay extra rent for the granite countertops and stainless steel appliances just because you can “afford” it. Instead, you might choose to get a roommate so you can share primary expenses and meet your goal of saving for yourself.
Scale down your expenses so you can scale up your dreams.
THIS is the Best Time of Your Financial Life
You may not realize it now because you probably aren’t making much money, or perhaps you are interviewing for jobs, but you are in one of the best financial positions of your life. You are a financial blank slate.
Even if you have crazy student loans, if you are a recent graduate, you likely don’t have too many mandatory financial obligations. You more than likely have a cell phone bill, and maybe a few other bills here and there. But as you get older and your lifestyle starts to inflate, the bills get more expensive, and you start to lose power to the things you’ve acquired in pursuit of #LivingYourBestLife.
Even if you do have crippling student loans or other major financial obligations, then you can still pay those down while paying yourself first. In this case, it may mean building a $1,000 emergency fund first, then aggressively paying down those student loans.
But once those debts are paid, you will already be conditioned to prioritize you over other lifestyle-inflating things. At that point, you’ll only need to spend a few more years racking up your savings, and then before your 40th birthday, you’ll be primed to retire from your cubicle job! (now who’s living their best life 😏).
When you prioritize yourself above your expenses, you are giving yourself the power to live your life according to your values, and not indebted to things you don’t need or companies who do not care about you.
Class of 2020, be selfish.
Prioritize your dreams, and save for them (i.e. traveling the world, having time to pursue personal passions, retiring from cubicle life in your 30s).
Be skeptical of anything that wants to separate you from your dreams by taking your hard earned money (i.e. expensive apartments, car loans, credit card debt to pay for nights out, etc.).
So, Class of 2020, what goals do you have that a strong grasp on your finances can help you achieve? Friends and family of graduates, what words of wisdom can you share to help the next generation start off on the right financial foot? Share in the comments below and let's start the conversation!
Want to continue the conversation? Join us Wednesday at 8 pm ET on Instagram Live@Winenance for Winenance Wednesday. Can't make it? Watch the replay onIGTV - #WinenanceWednesday. Cheers!
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