If you’re a fresh out of school college grad with student loan debt, you’re now two months into your six-month grace period. Generally the first six months after graduation isn’t the easiest to cope with, whether it’s applying for jobs, traveling the world, or simply taking a year to study for post grad. No matter which category you fall under, the concept of having to start paying that student loan bill down can be a bit overwhelming. Our team has put together 3 tips that can help you prepare for what’s coming in six months:
1. Create a Budget
This is extremely crucial! It’s important to know where your money is being spent and how much you are able to allocate to bills, savings, etc.. The faster you sit down and draw out this budget the faster you can plan for paying off your student loans. What we recommend is to sit down with a pen and paper and write down every expense you have for the month- not just bills but for things like food, gas and entertainment. Once you sit down and see what’s coming in and out every month is when you’ll truly know where your money is being spent every month.
2. Plan For The Long Game
Staring at the thousands of dollars you’ve racked up in debt is difficult to see the other side of the fence. Though, making your student loan payments does have its pros. It teaches you discipline and responsibility not to mention it helps keep your credit in good standing. Making your payments on-time over the next 10 years will help you when you’re ready to make big purchases such as homes, cars, etc..
3. Create a “Just In Case” Fund
Life happens; sometimes we encounter circumstances that are outside our control. Creating an emergency fund can be extremely important for any instance. Ideally you want to try and save 3-6 months of living expenses and put it away for a rainy day. It will also help you make sure you don’t fall behind on student loan payments. Now if you just graduated it may be a little tough to get started, and if you already have an entry-level job chances are you’re not making the best salary to allow you save thousands every month. But start with what you can put away and be consistent. Remember we’re thinking about the long game here, and putting away any money into your “Just In Case” fund is better then putting away nothing and being stuck if the time comes you ever need to use it.