What to Do When Bank of Mom and Dad Closes
- Create a monthly budget to ensure you have enough income to meet your monthly expenses.
- Establish a strong credit history by making all your loan payments, including your student loan payments on time.
- Set aside money every month for emergency savings to help you prepare for unexpected expenses.
It’s a wrap!
After all the hard work – the early-morning classes, late-night cram sessions, and lengthy-term papers – you’ve finished college and earned yourself a shiny new degree. Congratulations!
It’s bittersweet since college is an exciting and enlightening time of your life, but your learning journey is far from over. You’re about to embark on a sometimes scary and exciting new one – adulthood. It’s the time to channel your inner Rudolph and be “IN-DE-PEN-DENT” without the financial help of the Bank of Mom and Dad.
Ready for the challenge? Here are some smart ways to get off to a great start:
- Find a job. You chose college to have a brighter future. Now’s the time to cash in on your new degree and land your first professional job. It may take you a bit to find the right position, but that doesn’t mean you can’t find an interim or part-time job and start bringing in money.
- Get on a budget. Budgeting is so important at every stage of your life, including this one. Look at your sources of income and monthly expenses to see if you have enough to pay your bills. If you don’t, you’ll need to find ways to reduce expenses and boost your income. You could. For example, start a side hustle to bring in some extra money or get a part-time job to supplement a full-time one.
If you want to simplify budgeting, you can use popular budgeting apps. You can also use your bank’s mobile app or online banking service to keep track of your spending.
- Manage your debt, including student loans. Debt is the ultimate budget killer. If you have higher-interest credit card debt, pay it down first or look into a credit card balance transfer offer.
If you have student loans, begin making your payments as soon as the grace period ends – or even before if you can. Set up automatic payments to ensure you always pay on time and never miss a payment. If your parents have co-signed on your loans, your payment behavior will affect their credit, so you’ll be doing yourself and them a tremendous favor by paying on time.
If your student loan payments are too high for your budget or you wish to restructure (i.e., shorten the term) your debt, look into refinancing your loans to see if you can save money. Use our refinance calculator to see if you could potentially save.
- Establish and manage credit. Credit is so important in helping you reach your goals for life. For example, with good credit, you can rent an apartment or buy a home someday. You can build your credit by paying bills on time and by not using all of the money available to you on credit cards. Learn more about ways to manage your credit.
- Create an emergency fund. You never know what unexpected expenses can crop up. An emergency savings fund can help you prepare for them. Start by setting aside money in your budget for savings and have the money automatically deposited into your savings account each month. If you get a tax return or raise, up your savings.
- Build your financial knowledge. Learn as much as you can about money. There are plenty of free blogs that offer great advice on everything from budgeting to borrowing to retirement savings. Attend seminars and seek financial advice from experts whenever you have the opportunity. In personal finance, knowledge is truly power.
- Make your money a priority. Your financial life isn’t your whole life, but it is a huge part of it. Stay disciplined and constantly monitor your budget to ensure you’re on track.
- Make a financial plan. Think about your short- and long-term goals and figure out what you need to do financially to reach them. For example, if you want to buy a home in 5-10 years, budget money toward the down payment.
You graduated college and proven that you have the smarts, discipline, and work ethic to succeed. Now, put that experience to work and financially crush your new and exciting adult life.
Brazos is all in on your journey to financial independence
For more than 40 years, Brazos Higher Education has been helping college students succeed. As a Texas non-profit, we can offer you BIG savings on various student loans and helpful guidance to ensure you build the financial future you deserve. Contact us today!