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CBWY Blog

Managing Your Finances as a Young Professional

Life Stages Blog Post One

There’s no feeling quite like turning your tassel to the left and throwing your graduation cap as high as you can into the air. From our Community Bank to our college graduates out there, we’d like to say congratulations! Successfully completing college and obtaining a degree is no easy feat, and we’re as excited as you are about embarking on your new career. This is truly is a monumental time in life and even a Dr. Seuss story couldn’t capture the sentimental attitudes that you, your academic peers, and your family are probably feeling.

Planning Ahead As a Young Adult

Once the dust of post-graduation jubilance settles, you’re left with the realization that you’re now an “adult” and that the days of half-responsibility are behind you. As a working professional, you’ll be grinding at the bit working some 40 hours or even more per week. Unfortunately, if you’re like many (but not all) college graduates, a chunk of your income will go toward chipping away at your student loan debt.

Indeed, once you’ve embarked on a career path and begun generating a stable, consistent income, it’s important to know exactly what you’re going to do with your money on a monthly basis in terms of saving and spending. You’re young and you’re working; now is the time to set a solid financial foundation to build upon for...well, the rest of your life.

Helping You Achieve Financial Success

Fortunately, Commerce Bank of Wyoming is invested in the financial wellbeing of our community here in Rock Springs and the greater Sweetwater County area. In the first installation of our financial planning blog series, we’ll cover some tips, pointers, and general insight on what to do with your money — and what not to do with your money — as a young professional. Should you have any questions along the way, don’t hesitate to reach out to our friendly Community Bank. Let’s get started.

Establishing (and Maintaining) a Stable Income Source

Many post-college individuals struggle to find a job, or at least a job that pays well, aligns with their major, and provides ample career opportunities. At the end of the day, landing a job like that is easier said than done, but it’s imperative to at least have some sort of income whether or not it’s your “dream” job.

Even if it means working part-time as you continue to search for a better job, making some money is obviously better than bringing home nothing at all. Proactive students will take advantage of their collegiate environment by pursuing internship opportunities and leveraging their access to connections, ultimately setting themselves up for a nice job after graduation.

Creating a Plan to Pay Off Your Student Loan Debt

With a consistent income locked down, your next focus should be to eliminate your student loan debt (if applicable). Creating a repayment plan all comes down to budgeting. Once you’ve factored in every possible expense you have and weighed it against your income, you should have enough left over to at least make a minimum payment toward your principal balance, if not twice the minimum payment.

Most lending companies will give graduates a six-month grace period to help you find a good job and save money in order to start repaying your loans. Whether your principal balance is only a couple thousand dollars or well into the five figures, determine how much you can effectively put toward your loan balance each month while still having enough money left over for other expenses, entertainment, and savings.

Do I Need This, Or Do I Want It?

When you start making fairly decent money for the first time in life as a young professional, it’s pretty easy to get a little trigger-happy with your spending. In light of staying frugal and only focusing on purchases that are truly necessary or help you work your way toward a (relatively) debt-free life, ask yourself whether you really need a certain item or not.

If you’re working in an office that requires business-formal wear, then sure, splurge a little bit on nice dress clothes. If not, then stretch out the usage of your regular clothing. Our point? Value practicality in your purchases and you’re bound to save some serious change in the long run.

Research Debt Discharge and Other Debt Forgiveness Programs

Did you know that, pending on your situation, you may be able to qualify for student loan debt forgiveness? It’s true, but only select individuals are eligible. If you’ve entered the public service arena (i.e. military, city government, county government, federal government, etc.), you could get your loan balance significantly reduced or even outright absolved.

It’s worth a little bit of research to determine whether or not you’re qualified for this assistance based on your job position. Worst case, you’ll lose a little bit of time, and best case, you’ll “make” a ton of money.

Focus On Building Good Credit

A major component to building a solid financial foundation for life is focusing on your credit score and credit history. If you don’t have a credit card or any other lines of credit (with the exception of your student loan), Commerce Bank of Wyoming strongly recommends that you obtain one, and that’s not just because we’re inherently biased.

Nine out of ten times, no one has the cash laying around to buy a car or a house in full. The reality of the United States financial system is that credit is intertwined with our lives and ability to qualify for a particular purchase. In this sense, you’ll want to obtain a credit card and start by putting only a couple hundred dollars a month on it — no more than you know you can afford to pay off.

The credit trap starts when people start to charge more on their line of credit than they can realistically afford to pay off. If you’re concerned about this, just start with a small line of credit and transfer money from your checking to your savings. Then, you’ll have the exact amount of funds necessary to pay off the entire monthly balance on your credit card, all while building a strong credit score in the process. It’s a true financial win/win!

Use Commerce Bank of Wyoming as a Resource

Though college prepared you for the “real” world, we don’t expect you to know everything there is about...well, everything — especially finances and money matters. That’s why our friendly team of Community Bankers is here to help Rock Springs residents just like you. Contact us today and set up an appointment with one of our Personal Bankers to establish a solid and successful financial foundation for life.

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