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5 financial steps for new college grads in their first jobs

5 financial steps for new college grads in their first jobs

By Amanda Barroso | NerdWallet

It’s college graduation season, a time to celebrate the years of hard work and effort you’ve invested in your education and career development. Hopefully, the future feels full of endless possibilities. But there’s also an undeniable reality: those possibilities cost money.

One antidote to the uncertainty you might feel about your financial future is to put together a plan. Here are five first steps you can take now.

1. Build a budget you can stick to

The best budgets account for your needs, wants and financial goals. A 50/30/20 budget might be a good place to start.

The idea is to spend 50% of your take-home income on needs including housing, utilities, groceries transportation and minimum monthly debt payments. The next 30% of your income goes toward wants, like travel, monthly subscriptions and entertainment. The last 20% should go toward savings goals and paying down debt.

While your circumstances — like living in a high-rent area — might require more flexibility, this is a good framework for managing your monthly income. The key is to find a budgeting approach that’s sustainable. read more