Graduates, It’s Time to Plan: First Steps to Financial Independence
Graduation season is here! Cue the caps flying, proud family cheers, and that sudden realization that you now have to actually manage your money. Whether you’re heading to college, launching a career, or taking a gap year to "find yourself," financial independence starts now. And trust me, it’s better to have a plan than to just hope for the best (which, in financial terms, usually means being very familiar with your bank account balance: $4.37).
Step 1: Understand Your Income and Expenses
Your financial reality is about to shift. Maybe you’ll have a steady paycheck, or maybe you’re freelancing and juggling side gigs. Whatever the case, start tracking your money now. Even if your income feels small, knowing where it goes is the key to making the most of it.
Step 2: Set Up a Basic Budget
Budgeting doesn’t have to be restrictive or complicated. It’s just a plan for your money. Use the 50/30/20 rule as a starting point:
50% Needs (rent, food, transportation, minimum debt payments)
30% Wants (streaming services, eating out, fun money)
20% Future You (savings, investments, extra debt payments)
If your income is limited, adjust accordingly, but always prioritize saving something.
Step 3: Open the Right Accounts
At minimum, you need a checking account for daily spending and a savings account for emergencies (because eventually, a tire will blow, and no one wants to be stranded on the highway Googling "How to fix a flat with duct tape").
Step 4: Understand the Power of Credit (And Use It Wisely)
A good credit score isn’t just for buying a house someday—it affects your ability to rent an apartment, get a car loan, and even land certain jobs. If you don’t have a credit card yet, consider getting one with a low limit and paying it off in full each month.
Step 5: Start Saving for the Unexpected
Life happens. Having an emergency fund of even a few hundred dollars can prevent a minor crisis from becoming a financial disaster. Start small, but start now.
A Warm Reminder
Financial independence isn’t about being perfect with money from day one; it’s about taking small, smart steps that add up over time. Give yourself grace, keep learning, and don’t be afraid to ask for help. The goal isn’t just to make money—it’s to build a life where money serves you.