University is boot camp for retirement. Make sure you’re prepared to be fiscally responsible when you graduate, or years from now the version of you with less hair and more weight will regret it when you have no IRA. Here’s how to get started…
With summer over, new graduates are leaving the relative ease of university life for a final trip to the beach, a weekend in the mountains, or last sweet kiss with freedom. Whatever the activity, everyone who has graduated knows that this summer is different. Unlike the traditional months of relaxing and enjoying the camaraderie of friends, there’s an expectation. New graduates will need to start working in earnest for the first time, which means there is no better time to start considering options for the future. In fact, before leaving the last bits of carefree youth behind and entering the work force, there are four important things to think about spending less and paying off student loans so you can retire earlier and enjoy life longer.
Mirrors are cheap. Buy one, look at it often, and we can laugh together. Best of all, it doesn't require much more money than feeding a monkey. Speaking of monkeys, you were probably planning to spend a large portion of your money on going out with your friends, AKA the other monkeys. Bad idea. Give it a few years, go out less, and when you do, go out much later in the evening. You could easily save $1,000 or more each year. Besides, saving money builds confidence, and few things are more sexy than confidence. In fact, if you mix money and confidence, you get Donald Trump. Just, ah, do something about that hair. Please. It scares me.
You might have had plans for prime rib and caviar every night, but unless you’re a politician sucking off the teat of your constituents, you’d better take it easy. Saving a little money now by eating less expensive foods can really add up over the long run. Besides, a lot of what you find on shelves these days is repurposed food anyway, so you’re better off to make most of the expensive prepared foods and home and repurpose them yourself. The average person can easily save $50 to $100 per month on food expenses.
There are two roads you could take here, and likely neither one was known to Robert Frost. The first involves either a tent, or chilling with the local Chili Pepper fans under the bridge downtown. In this case you’ll save a lot of money, but need to have a gym membership to freshen up between jobs. The other route is that of the roomie. No doubt you foolishly thought those days ended with college, but the reality is that a decent apartment is upwards of $1,500 a month in most areas of the city. If you look for a room, you can find one for $500 and less. You might not always like the people, but it’s a great way to prepare yourself for marriage. Besides, where else can you save $500 a month?
Even though a Bentley would look sweet in your yard, you’re probably going to want to settle for something less expensive than a house, and more along the lines of a really expensive bicycle (you know, something in the $5,000 range). Since most first time car buyers end up with a new car in the $20,000 range on a 5 year loan, you could easily save $3,000 per year by purchasing that lovely used grocery getter. Just don’t install a lift kit in it to be cool, and forget about the stereo. Seriously. I’m watching you.
At any rate, take your time, don’t go crazy, and you’re sure to get off to a good start. You might not have the best apartment, coolest car, or throw the wildest parties, but you probably weren't doing any of that in college anyway. Also, with all the money you save, you can take wild vacations to tropical paradises and pretend to be a billionaire. Depending on where you go and how much you save, you might actually be able to live like one too.
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