Congratulations! You've recently graduated college and that means it's time to enter the real world. Many young people graduate school with various degrees and vast amounts of knowledge, but what graduates don't enter the real world with is a class on money management. Instead of carefully budgeting or creating a plan for spending, graduates often refuse to save and spend money that should really be placed somewhere else. If you follow these tips, you'll be able to grow your wealth at a decent pace and grow your savings.

1. Create a Budget

At the top of every graduates list should be the need for a budget.

A weekly spending limit on food, an allowance for transportation, and a "fun" fund. One of the biggest expenses for a new college graduate is the rent, as that usually takes out a huge chunk of income. That's part of the reason why many graduates still live at home, and save money. Graduates should spend no more than 30% of their gross annual income on rent, and avoid apartments out of that price range. That means, on a 60K salary, the rent a graduate would be able to afford should be around $1500 a month.


If you aren’t in student debt after graduating, saving should begin right away. There’s no excuse unless there are medical/family constraints in place. There’s really no reason why college students can’t put away between 5 and 10 percent of their income each pay period into a savings account.

Over time, 50K can slowly build up to $8000 in annual savings. And eventually, you’re going to want those savings for flexibility in work, eventual travel, and even children! (I know it’s early to think about)

3. Invest.

Once you've saved some income, there are numerous options available to you to grow your money. The first and most obvious is the stock market, which has been on a solid uptick since the 2008 recession.

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It has grown quickly and reached all time highs, and it's one of the fastest (and relatively safe) ways to grow your money.

If you're risk averse like me, you can also invest in low yield bonds (very safe), or certificates of deposit (CDs), which offer higher annual yields than normal savings accounts, but also lock your money into the account, and it cannot be withdrawn.

Alternatively, the funds can simply be kept in a normal savings account, where you will always have access to them and be able to use them.

4. Credit Cards.

It's important to have a good credit score in today's world, as that can qualify you for both renting and home buying. Recent college graduates should definitely have a credit card, but they should also have a card that offers rewards on purchases. I have a PayPal Mastercard, which offers 2% cash back on all purchases, a solid return when you consider that I would get nothing on normal purchases without the card.

But don't be fooled. Credit Cards are only worth it if the bills are paid on time, so don't start accumulating massive credit card debt that you can't immediately pay back.

The fees and interest will only increase dramatically and you will have even more trouble paying off the card.

I hope you enjoyed this article. As a recent college graduate, I am doing my best to save and plan for the future, and I hope other graduates are doing the same thing as well.