Financial Independence and Mistakes to Avoid

Avoid financial pitfalls.

Graduating from college is an exciting time and you should be immensely proud of yourself for coming so far. Yet it is also a difficult time, as your sense of responsibly might feel like a sudden burden as the need to find employment looms over your head. If anything, you are wondering how you are going to pay back your student debt, which you undoubtedly have accrued like so many other graduates. But relax. The jobs are out there and you will be able to pay back your loan without trouble. But it will take dedication.

Without the proper focus it is easy to stumble into financial pitfalls, especially when you are just starting out on your own. But these falls are also important, because how else do you learn? What is crucial is that you keep these mistakes to a minimum and never allow them to grow so big they add considerable stress to your life.

Take advantage of your grace period

When you graduate, you are typically given a grace period by your lender which means you don't have to begin making payments on your loan until six months have passed. This allows graduates a chance to get on their feet and set some money aside so that when the grace period is over, payments can be made every month. However, it is advantageous to start making payments during this time, according to The Simple Dollar. Get ahead of the game and into the habit of paying these monthly amounts. By waiting, you aren't doing yourself any favors in the long run.

Be in control of your finances.

Set a budget

Even if you don’t have a steady job just yet, it is important to begin putting your budget together regarding your current situation. While you expected your dream job to be waiting with open arms after you had your degree in hand, that doesn’t always happen. But you still need to start taking a detailed approach to your costs. Are you living on your own? In addition to your monthly student debt payments, do you have other bills due every month? Also, you will need groceries and money for transportation, whether that means gas or a public transportation pass.

Remember to include all expenses

When establishing your budget, which you certainly need to do once you are on your own, you need to account for those miscellaneous spending habits that aren't established monthly payments, noted Forbes. Many things come up, such as emergencies, holidays and vacations. If you don't have money set aside for these events, then you are going to dip into your savings, which is never a good idea. Consider all of your expenses, even small things like coffees and impulse-purchased snacks. It all adds up and the better prepared you are the better you'll be.

Live within your means

It is common to feel like you are in a hurry when you graduate. Some people will be getting jobs or graduating with an internship lined up that pays and leads to a steady career. Other people will be a bit slower in their steps, but that doesn’t mean they are behind.

Keeping up with others, or living in a place you can barely afford to give the impression of keeping up, is on the minds of many young people. You want to demonstrate you are successful, and one way to do this is by spending money and showing your items off to others, whether in the form of a car, a large apartment or a new stereo system. This is a fast way to get behind on the expenses that matter.

U.S. News & World Report highlighted this as one of the most important tips for recent graduates. Don’t try and keep up. Live in a place that is comfortable for you and your wallet.

Be organized

One of the biggest mistakes a recent graduate will make is not being organized. It is easy after your education program finishes to want to put your feet up and just live freely for a bit. However, if you are unorganized then you are going to run into some serious financial pitfalls because you won't have a solid grasp of your habits, according to a separate report from The Simple Dollar. Be organized in all aspects of your life so that you don't lose track of anything, especially your finances.

Don't run into financial pitfalls, which is so easy for recent graduates to do. You are smarter than that. Consider your graduation into adulthood as a fresh start into financial stability.

Be honest

If you have a job, but can’t keep up with your finances, either something has to go or you have get another job. Being honest means more than just looking at your situation and doing what needs to be done. It means picturing yourself where you want to be, and taking the steps to get there from where you are now.

This might mean you have to spend less on entertainment, or perhaps you need to start cooking meals instead of eating out all the time. Whatever it is in your life preventing you from taking steps forward and growing your savings while eliminating debt, it is time to fix it. According to Money, which sought advice from recent college grads about financial best practices, being honest and true to yourself was the biggest recurring item. This means being courageous, saying no when you want to, limiting yourself where you need to and going for it when you feel confident about it.

There is no way around the rising costs of student debt, but that doesn’t mean it should prevent you from living your life. Take a realistic approach to your finances and don’t get swallowed by stress. Most graduates have significant debt, and all are trying to work through it. Adding stress or worry to the equation won’t help.