This spring and summer there are many folks graduating from college and heading out into the work force. It is important to get your financial life in order right away to help avoid future pitfalls. Follow these tips to help you become financially fit.


Some people call this “pay yourself first.” If you have any kind of savings deducted automatically from your paycheck or your bank account, you’re not likely to miss it and you are more likely to save. The goal of savings is to meet your short term and long term financial goals.

Want to buy a car? Put the equivalent of a car payment each month into a savings account and in less time than it would take you to pay off a vehicle loan, you will have enough cash saved to purchase that car. Walk into the car lot with cash and you will most likely get a better deal on the car than you would if you were financing or leasing the car. And, you don’t have to pay any interest to the bank or financing company!

If your employer has a retirement plan, take advantage of it. If they provide matching funds, every dollar you put in the retirement plan automatically earns you 100% up to the amount of the match. Even if they don’t have a match, the tax benefits of a retirement account will save you money on your tax bill. And there is no tax on the earnings in the retirement account until you take money out of the account. CAUTION: Never, ever take money out of your retirement account until you are at least age 59½. If you do, you will owe a 10% penalty to the IRS on top of the regular income tax.

Develop a spending plan

When you have a spending plan, you decide ahead of time what you are going to spend your hard earned money on. The goal should be to spend less than what you earn. Add up what you will be spending on the necessities: housing (rent, utilities, renter’s insurance), food, transportation (saving for a car, gas and oil, taxes, insurance), and clothing. Subtract this from what you earn and you have the remainder to spend on whatever you want such as eating out, entertainment with friends, having a pet, or personal expenditures. When you decide ahead of time what you will spend on each category, you’re free to do those things you want to do while paying attention to how much you spend.

Be creative in your spending. Here are some ideas:

  • Instead of going to the bar with friends to watch the big game, watch the game at your place with everyone bringing food and drinks to share. Some folks have saved $100 or more per game on this strategy.
  • Instead of purchasing the full cable package, look at alternatives like Amazon Prime, Netflix or Sling TV.
  • Car pool or combine trips to save on vehicle costs.
  • Barter with friends to save money. For example, you change the oil in your friend’s car and he/she makes a homemade meal for you.
  • Check out second hand stores for clothing and household items. Depending upon the store, you can often find excellent deals for name brand clothes.

Assess your debt

Commit to no new debt. If there is something you want to purchase, save for it first. You may find that you don’t want it as bad when the time comes to buy it. You may decide there is a bigger goal you want to continue to save for such as the down payment on a home.

If you already have debt, be sure you understand the total amount of your debt and the terms of the debt. What in the interest rate? What are the required monthly payments? Work at paying off the debt as soon as you can so you have more money to meet your short-term and long-term goals.

Want more help and ideas? Contact us at [email protected] or 402-502-0250.

Judith Ackland has more than 26 years of experience in accountancy and financial planning, including seventeen years as a CFO of a diverse business. She started Crystal Financial in 2010 to help a wide array of individuals, families, and business owners better understand their finances and how good financial management could help them achieve their goals. Judith has an MA in Professional Accountancy from the University of Nebraska at Lincoln as well as a Certified Public Accountant Certificate and a Certified Financial Planner designation.

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