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How new graduates can conquer entry-level income challenges

This spring, millions of high school and college students are preparing for graduation and the next phase of their lives.

But are new grads ready for the financial challenges that lay ahead? According to a report by the Institute for College Access and Success's Project on Student Debt, the average student loan debt for borrowers in the college class of 2011 was about $26,500.1 Soon enough, budgeting money from that part-time job at the mall for movie tickets and other entertainment expenses is quickly replaced by rent, utilities, food and transportation costs as well as student loan payments.

Get some tips.
Fortunately, there are many tools and tips available for new graduates to get started with budgeting and saving. Microsoft Office offers a free Personal Budget Worksheet to help track income and expenses each month, or you can create your own spreadsheet. Plus, several organizations offer free tips for saving money and budgeting on a lower income, which is typical for entry-level jobs.

Track yourself.
There's an app for everything, including budgeting and tracking expenses. See what's available to your phone and get started.2 You'll start to notice patterns and places you can start saving. Like exchanging that $4 latte for the free coffee in the breakroom.

Prep for the new expenses.
Recent graduates must also prepare for those under-the-radar expenses, such as auto insurance premiums, health insurance contributions and banking costs. Student bank accounts can also change soon after graduation. TD Bank features a Checking Account Selector tool that compares checking account options to best fit customer's needs and help them save money on fees. New grads should also set up direct deposit and connect a savings or money market account to their checking account, automatically transferring a manageable amount from each paycheck to build savings.

 

But don't forget the fun.

Joining the professional workforce is an exciting and challenging time for young adults, and all the new expenses can seem overwhelming at first. Take it one step at a time and don't forget to budget for entertainment - just because you're out of school, it doesn't mean you can't have any fun!

1Project on Student Debt. http://www.projectonstudentdebt.org/ n.p. unknown. N.d. March 2013.

2Perez, Maria. "10 Tips to Stop Spending and Start Saving." America Saves Week. N.p. unknown, n.d. January 2013. http://www.americasavesweek.org/

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This article is based on information available in March 2013. It is for general informational purposes only. It is not intended to provide specific financial, investment, tax, legal, accounting, or other advice and should not be acted or relied upon without the advice of a professional advisor. A professional advisor will recommend action based on your personal circumstances and the most recent information available.