Recently, I’ve received a small deluge of emails from upcoming college (and high school) graduates that all have the same theme: The real world is coming! Help! For one thing, if they’re bothering to read a site like Money360, they’re already way ahead of the game, but there are still a few things that any college student should take care of before stepping out of school and into the real world. Here’s a list of seven money tasks you should try to take care of during your final semester in school.
Ensure that you have some way of spending your time in a productive fashion after you graduate. This can be self-employment or even working a job that’s not what you desire. You need to settle into a life of being productive, no matter what you’re doing with your time. Why? The world will not hand you money. Don’t sit around wasting time hoping that that dream job will fall on your lap – get started doing something, preferably something that points in the general direction of your dream job.
Don’t worry about pay. Seriously. Don’t. Your first job out of school should be one that maximizes your resume building, not one that maximizes cash in the wallet. If you happen to get one that does both, awesome, but do not put quick money ahead of long-term building at this point in your life.
Do whatever you can to minimize the interest rate on any outstanding debt. If you have student loans, stop by your loan office and ask what you can do to minimize the interest rate via consolidation. If you have credit card debt, start paying it down as soon as possible. Debt is going to do nothing but hold you down for the next few years. If you’re thinking of using your credit card for anything at all, ask yourself if you’ll view this as a worthwhile purchase in three years. If the answer is no, what are you doing?
Get a good checking account. Call some banks and try to find a checking account that minimizes fees. I would take a serious look at Electric Orange from ING Direct, which earns a 4% return on your checking account balance and has basically no fees at all (but you don’t get printed checks except by individual request).
Get your money into that account. By the end of the semester, you should have your working money consolidated in that selected checking account so that you aren’t continually dealing with the drain of fees and maybe have some interest working in your favor. You shouldn’t have many bills, so switching shouldn’t be too hard – here’s a guide on how to switch accounts.
Get a high-interest savings account. I recommend either ING Direct (4.50% APY, it’s the bank I use, great customer service) or HSBC Direct (5.05% APY) – rates as of this writing.
Start an automatic withdrawal plan from your checking to this savings account. Why? This will be your emergency fund to bail yourself out when things go awry (and at some point, they will – trust me). It doesn’t have to be much, it just has to be regular, and you have to forget that the emergency account exists until you need to tap it.
If you do these seven things, you’ll be way ahead of the game on your graduation day.