You graduated from college. You earn a decent income. You are fairly happy with your career. However, for some reason you are still not saving as much money as you would like to. You feel that your financial situation has room for improvement. What are you to do?

With the current college semester in session I think it’s time to shift some focus to the college graduates that read Studenomics. When I first started writing for Studenomics I wrote about how you shouldn’t graduate from college cheap and provided some tips on paying down your student debt. Today I want to discuss some more money management advice for college graduates gathered from college graduates:

Take an honest look at your lifestyle

Do you really need to wear $150 Affliction jeans? Besides the fact that the company failed at promoting fights (hope some of you catch that), why would you feel the need to wear such expensive jeans? Do you pay $50 to get into high scale night clubs? Do you try to associate with people that come from money? I’m 100% positive that if you take an honest look at your lifestyle you will find many areas where you can improve your finances and save more money.

Consider moving into a smaller unit

So you moved out of your parents place and are now officially on your own. Don’t worry I won’t try to convince you to live at home until you’re married or 40 years old (whichever comes first) like some other personal finance writers do. What I will suggest is the possibility of down sizing into a smaller unit to cut down on rent/mortgage and the other expenses that come along with owning a larger unit. If you’re earning $50,000 a year do you really a 2 bed room condo downtown?

Cut back on small expenses

I don’t mean to write about saving money on coffee or to cut your own hair but I do want to stress that small expenses can add up over time. As foolish and basic as it may seem it could be the small expenses that are messing up your financial system. Some common examples of small expenses that can add up include; eating out for every meal, having a beer with dinner, and luxury services that you don’t really need.

Educate yourself

Now that you have been out of school for so long, the idea of going back may not seem so absurd. Aside from networking and being great at what you do, it is essential that you upgrade your skills by keeping yourself educated. Most companies are willing to pay for you to take certain courses that will help you become better at your job.

It’s a bit more difficult to receive funding from your company when you want to learn new or unrelated skills. This is where you pay out of your own pocket. I know that paying out of your own pocket to sit in a class room may not seem like the most exhilarating idea. In order to change your mindset on this it’s important that you look at the return on your investment.

For example, if you take a $500 course that will result in you receiving your personal trainer license think of all of the income that could result from this. On top of acquriing the knowledge that goes along with being a personal trainer, you now have the ability to earn some extra money on the side. This is just one example of how you can benefit from learning something new.

As a college graduate, what money management advice would you like to share with the readers of Studenomics?

photo: Krispijn Beek

As many recent college graduates are struggling to find work the traditional route, they turn their attention towards emerging careers. An industry that has been on the rise for years is the work-from-home/make money online field. There are many legitimate work from jobs but the sad reality is that there are many work from home job scams around.

Last week I wrote about one of the newest work from home job scams, Goog Cash4u, and received a thought provoking sentence in a comment from a reader.

During this rough economic time I so wanted to believe the promises and fell for it.

This got me thinking and I decided to conduct some research on the work from home job market. After reading a few great resources I came up with a list of ways you can protect yourself and be cautious of work from home job scams:

Don’t spend a lot of money on a work from home job

If you have to pay $500 for some “online marketing guru” to show you how to make millions by working from home then you are better off using that money to send me on vacation. At least I would have a good story for you. These internet marketing gurus sell you the idea of a real work from job but they usually end up taking off with your initial payment. If they don’t take off then you are usually stuck with a get rick quick idea that does not get you rich nor does it even allow you to live above poverty standards.

Determine whether its a scam free work at home job

Ask important questions. Who will you work for? What type of work will you be performing? Yes I know they want you to think you will relax on the beach all day but how will you earn an income is the important factor. What credentials are required for this job? If they are looking for educated people and you fit the bill then it could be a great opportunity. If they claim “anyone can make thousands from home” then it may not be so legitimate.

Look into your pay structure

How the hell are you going to get paid? Will you earn a salary? Will you get paid on an hourly basis? Will you get paid commission? Someone can guarantee you will make tons of money by working at home but how will this money get to you? Will you receive pay checks? Will you get paid through PayPal? These are all important questions that need to be answered before you begin working from home.

Watch out for common work at home job scams

A newer work from home job scam such as Goog Cash4u may catch you by surprise. However, there are classic work at home job scams that have been around since the advent of the internet. As a new college graduate the onus is on you to educate yourself on the various work from home scams and how they have impacted others in the past.

Protect private information

Do not under any circumstances ever email anyone your social security number, social insurance number, passport number or any other number that  is extremely private. I will take this one step further and say that you should not give out any private information unless you are 100% that it is not a work from home job scam. As a recent college graduate giving out private information could cause major grief for you early on in your working life.

Watch out for overseas work from home companies

If the work from home company is based overseas and a simple phone call is expensive, then that’s another negative sign. Not to say that you are guaranteed safety with a local company but at least you know where to go and who to call when problems arise.

That’s all I could think of for now in terms of how college graduates can watch out for work from home job scams.

Are there legitimate work form home jobs? Of course. I will do more research and get back to you guys with a look at real work form home jobs. For the time being, what’s your take on the whole make money from home business?

photo: digitalpoint1

Graduating college can be a surreal experience. You finally made your way into the real world. Congratulations! Luckily, you found yourself a good paying job and now comes that thing called “Responsibility”. For those that are eager to invest and get ahead, it can be very overwhelming trying to decide what is the right direction to go.  Before you get started, here is a few tips to get you going on the right track to becoming a bona fide investor.

1. Take inventory.
Taking inventory of all your debt is helpful to understand where you are at financially. If you just graduated with a ton of student loan debt, credit card debt, or any other consumer debt, investing might not be the right direction initially.  You need to write it down and see it on paper what you actually have to work with and what you need to focus your efforts on.

2. Don’t start too soon.
As I stated earlier, if you have an absorbent amount of consumer debt, it is probably not the best sense to start investing immediately. One could argue that as long as your student loans that have a low fixed interest rate, those are okay to have.  But private loans or any credit cards that have a high interest rate need to be paid off before considering to invest. Once you get your cards paid off, then we can talk about investing.

3. Stay away from stocks.
With every new and eager investor that I run across, they all want to jump in the stock market and start buying individual stocks. I was no different. To truly get ahead in buying stocks, you have got to have a decent amount of cash built up to make a difference. For example, I always recommend buying at least 100 shares of a stock.  Well, if you want to buy Microsoft, that would require around $2000 to get going.  Even if you have the money to buy 100 shares, chances are you are not fully diversified. One bad pick and you can easily see your entire portfolio disappear overnight. Play it safe, stay away from stocks in the beginning.  Consider mutual funds and ETF’s in the beginning.

4. Don’t forget your 401(k).
Hopefully, your new employer offers some sort of retirement plan such as a 401k. Your 401(k) is the easiest way to invest since it’s automatically deducted from your check.  Out of sight, out of mind, heading straight into your retirement savings.  The best part is if your company’s 401(k) has a match. You’ll be making free money by just participating in the plan.  You can’t beat that when it comes to any other retirement savings plan.

5.  Say yes to the Roth IRA.
This is pretty basic advice that you probably hear from a lot of other personal finance bloggers, but it’s one worth mentioning again.  After your free money in your 401(k), take advantage of the tax-free benefit of the Roth IRA.  Roth IRA, especially for a recent grad, is awesome because time is on your side.  You have so much time for the interest and earnings to accumulate for a whopping tax-free sum waiting for you at retirement. Here’s a good resource for what you need to know about the Roth IRA rules.

These are five basic steps to get you on the right track.  Congratulations on your recent graduation.  Have fun, enjoy, and get financially set.

This is a guest post from Jeff Rose, an Illinois Certified Financial Planner(TM) and co-founder of Alliance Investment Planning Group. He is also the author of Good Financial Cents, a financial planning and investment blog. You can also learn more about Jeff at his website Jeff Rose Financial.

The other day an interesting topic came up in a discussion for my post on signs when you should quit your job. Loyal reader Trevor brought up the point of saving 6-12 months worth of living expenses before pursuing any business ventures. Then another loyal follower of Studenomics, Tom, asked about what someone should do if they don’t have 6 months worth of living expenses saved up. This brought up an interesting question for me; how much money should a new graduate put towards an emergency fund?

To be perfectly honest I don’t have an answer to this question. I have been reading many personal finance blogs that constantly stress the importance of an emergency fund and various investment vehicles for these funds. The only problem is that me and many of the great readers of Studenomics are 20 somethings that are no where close to having a family of our own. Most emergency funds state that you need at least 3 months worth of livings expenses for your whole family. Jeff Rose states that if you have a sales related job you should have 12 months working of living expenses in an emergency fund.

So this brings us back to the original question that I still can’t answer; how much money should a new graduate have in an emergency fund? Yes I realize that I have not discussed the whole emergency fund at all on this blog so you should expect a few quality posts on emergency funds in the coming weeks. Today I will provide you with key points so that YOU may determine how much money belongs in your emergency fund:

Risk tolerance. If you plan on working the same job for many years to come then maybe you should focus on slowly building your emergency fund. If you are someone that likes to take chances with their career or if you plan on pursuing new business ventures in the near future then you should definitely consider having a decent sized emergency fund.

Adversity quotient. How quickly can you bounce back from a failure? If you are the type of person that will take one giant chance, fail, and then sulk for the next year then you definitely need 12 months worth of living expenses saved up. If you have the ability to turn an obstacle into an opportunity or to bounce back from a failure immediately then maybe building an emergency fund shouldn’t be your main priority.

Job security. This is arguably the most important point to consider when working on your emergency fund. How safe is your job? During a booming economy you could be working in finance making a fortune and laughing at the thought of an emergency fund. During a recession we must all consider the importance of an emergency fund, no matter how lucrative your current position may be. Some industries are recession proof while others collapse as soon as there is the slightest economic downturn. For the sake of your future, take a realistic look at your current position and ask yourself this question, will I still be employed in a year from now? If you feel the answer is no then I suggest becoming very aggressive with your emergency fund.

Final thoughts… Studenomics is not meant to be a blog where I tell you what to do or how to do things. We are all here to help each other and I have a lot to learn from the readers. In this article I simply provided a few key points for a new graduate to consider when building an emergency fund. Now it’s time to turn it over to the readers, how much is in your emergency fund?

So your working your first job post College and your excited about your upcoming first pay check. Only one thing is in between you and a wild night out on the town; $30,000 in student debt that you have to deal with paying off. The thought of this student debt alone will most likely ruin your mood and make it seem like you will not see a profit for years. I’m here to tell you that you can take a breath and relax, this guide will show you the cure if you happen to be a College graduate drowning in debt.

Step 1: Accept your situation. You can blame the whole world for the fact that you had to cover your education costs through loans but where will that get you? Your parents worked hard to raise you, feed you, and put a roof under your head. Don’t go blaming them or anyone else for not being able to pay for YOUR education.

Step 2: Educate yourself. Read as many books, blogs or magazines as you can on the subject so that you understand the situation completely. Take some evening courses or speak with friends that work in the financial industry.

Step 3: Consolidate your loans. If you obtained various loans in order to cover the costs of your education then your first priority should be to consolidate them. Obviously while looking into consolidating your debts you should seek the best possible rates.

Step 4: Make the payment automatic. Go to your payroll office or even to your bank and set up an arrangement where a set amount of your paycheck will go towards paying down the debt.

Step 5: Be reasonable. Don’t expect to pay this debt off right away, it took you anywhere from 3-5 years to acquire it so it will take an extended period of time to pay it off.

Times are tough, many employers are hiring less staff, some employers are cutting back on staff, and you probably have a decent amount of student debt that you need to pay off. Yet when hunting for the perfect first job you should still NOT be cheap.

It’s easy to let the stress of student debt force you to become tight with your money. There is nothing wrong with that. However, there is a huge problem with trying to be cheap while seeking that dream job. Before you rush off the computer to go hunt for that first job, please take a moment to review this list of times where you should not be cheap after graduating from College:

1. Networking. Spend a little money if it will help you meet key people in your industry. Take out a friend or relative that may be beneficial to network with for coffee. If you really want to leave a lasting impression then consider taking them out for dinner. The meeting could be pointless but there is a good chance you will at least leave more informed then you were heading it. As a new College graduate you have so much to learn about the real world that anytime you spend with someone in your field could really help you learn some key inside knowdledge. You don’t want to try networking with someone by showing them you are cheap. A small gesture goes a long way so consider spending some money to do some effective networking.

2. Appearance. Many other personal finance bloggers are going to yell at me for this one but hear me out. Some industries are very cosmetic and whether you want to admit it or not your image could take you a long way. I’m not saying that you should go work out like crazy or anything like that but consider dressing sharply for an interview or any networking events you attend. You don’t need to wear a Hugo Boss suit to an interview but don’t go dressed in your clubbing attire.

3. Job Agencies. This is another area that some people are totally against but they have helped out many 20 somethings in the past. Some employment agencies have a fixed fee while others take a certain percentage off your first few pay checks. The cost may annoy you but if they are helping you get the job then why complain? Make sure you look into the reputation of the agency because some are known for excellent connections and networking while others are the joke of the town.

Would you rather be good at many things or the best at one thing?

Everyone has heard about all the hype over diversification, but is it really the ideal way to go? When it comes to new grads, diversification is dangerous. This is for a variety of reasons, mainly because it is rare that a company will be looking to employ a “Jack of all trades.” Employers tend to look for individuals that are the best at what they do, not good at many different things. The goal of this article is to show new grads how to combat diversification when seeking that very first job:

Focus on being the best at one thing. No matter what your career choice is make sure that you are the best at one task in that field. Every career field is structured differently so you must choose an area in the field that truly interests you and one that you feel you could excel at greatly. For example if you are looking into getting into the Human Resources field then try mastering the art of recruitment. Instead of telling the employer that you are good at the many aspects of HR, inform them that you possess a great wealth of knowledge in the area of recruitment.

Embrace risk. Yes you have a higher chance of obtaining a position by being good at many aspects of a field, but if you really believe in yourself then it is a risk worth taking. Despite decreasing your chances of finding a job, you will increase your chances of finding a job that is perfect for you.

Grow with the times. It is important to realize that even though the information may be timeless, application does change. Ensure that you keep up with any laws that may change or any changes that could alter the way you perform your job. You should also keep up with any relevant cases that may be ongoing because certain situations could change the field as well. Another important aspect to keep up with is technology because you do not want to fall behind of the other individuals in the same field.

Expect the unexpected. Anything could so be ready for the worst case scenario. Imagine in your head a scenario that if it were to occur would be absolutely horrible, but odds are it will not happen. Then imagine this scenario actually happening. Now think about how you would react and what you could do to combat this. By being fully prepared for any drastic changes that could potentially occur then you will be on the right path.

Now that you are done with school and in the work force, it is time to shift into cruise control?

Unfortunately this statement could have been true during an economic boom, but the recent economic bust proves the statement wrong. The volatile economic state right now will have many new faces in the work force scratching their heads because life is not as good as they expected it to be post school. Your quality of life should not deteriorate nor should your mental state, but you will find yourself working hard only to have to cut back on some purchases you may have been looking forward to. This article is specifically aimed at anyone that is in the work force and experiencing an economic bust (dare I say recession?) for the first time in their life. 6 key ways to survive an economic downturn are listed below.

1. Decrease your subscription costs. Most people need to own a cell phone for a variety of reasons, so the most logical method to save money is to get the most basic plan, without the very amusing video messaging of course. Do not join any fancy gyms that will cost you over $50 a month. Do not subscribe to any celebrity gossip magazines or any magazines that will not directly improve your life. Unfortunately, hearing about Britney Spears’ new boyfriend will not improve your life. Pretty much do not join anything that charges you a monthly fee unless you absolutely have to.

2. Watch your food costs. It is important to eat healthy, but it is not important to eat at a fancy restaurant a couple of times a week. The best solution is to go grocery shopping at the beginning of every week with a clear list of what you will need to eat for the whole week.

3. Ditch the plastic. There is nothing wrong with holding one solid credit card that offers rebates, low rates, and low yearly fees. The killer tends to be the credit cards with high interest fees and with annual fees. On top of that, the more credit you have available the greater are the chances you will spend money carelessly.

4. Avoid purchasing a new car. If you live in a city with an exceptional public transit system and you work on an easily accessibly bus route then by all means avoid purchasing any vehicle. If you must purchase a vehicle then search around through the various automobile trading websites until you find the right car at the right price.

5. Live at home. Once again the most valuable advice I could give anyone, milk living at home as long as possible. If you truly insist on moving out then make sure you have enough money to survive in an emergency, in the event that you should be out of employment. Ensure you make a wise decision in terms of whether you will rent or buy and that you have the proper amount of money saved for the option you choose.

6. Stay in school. This may seem like a total contradiction but it makes absolute sense. If you cannot handle the pressures of having to work for your money and worrying about budgeting your income, then simply stay in school until you are ready. Not only will you hopefully mature but you will also boost up your resume.

Schools done and now you are going to be rich? Think again. All of those hours spent in the library, all of those all nighters, the excessive weight gains and weight losses, all of the parties missed to study for an exam, and all of those expensive text books will be beneficial- just not right away.

Biggest Misconception Amongst Young People? Probably one of the biggest misconceptions amongst students is that they feel they will earn a small fortune their first year out of school, unfortunately this is not true. Most entry level positions for recent graduates from a University/College program will not exceed the $40,000 mark. Do not let this discourage you because you will get that dream position of Executive Manager or Charge Nurse, just not right away. Just like it most likely took you four years to complete your post secondary studies, it will also take you at least the same amount of time to advance to your dream job.

The reason for this? Besides the obvious fact that nothing comes easy in life (well for most of us at least) there are increasingly more students graduating from post secondary programs every year with all of them competing for the same prestigious jobs. On top of all of the competition, most employers are seeking qualified individuals with the proper education and specific experience requirements. Most young people graduating from their respective programs only have experience in studying for exams while trying to keep up with Facebook, not the detailed work experience that some employers are asking for. Even if one of the companies you truly wanted to work for decides to give you a chance at employment, odds are they will start you at a less than ideal entry level salary. Now will all that said please do not let it discourage you because the harder you work for something the more you will appreciate it. Hence, when you do get that dream job (with all of those years of experience required) you will truly be satisfied. Remember, if you enjoy what you do for a living, you will never work a day in your life.

Before you get that dream job let me give you the key guidelines to look for when selecting that first job out of school.

Reputable Company. Before you even have an interview with a company you should conduct an extensive background check of the company, so if anything you at least know what the company is all about. Prior to even applying at a company you should write down a list of companies that you strongly believe in, then you should narrow down this list to the companies that you would truly want to work for. The last step you take is search through employment websites and the company website to check if the company is seeking interview candidates for your particular field of study.

Growth Potential. Find a company that has many positions and many levels of positions. You will obviously start off at the bottom, but there should be a clear level that you strive to obtain within a specific time frame. In addition to a company having higher levels of positions, it should also have clear guidelines on how an individual is to move on up in the company. The clear guidelines are usually found in the internal job postings under requirements or by simply asking people in higher positions how they got to where they are. Typically union jobs are the worst for offering growth potential as they usually fill positions based on seniority not merit.

Education Opportunities. So that your skills do not become stagnant you should ensure that the company you look for offers free courses and programs that will increase your value to the company. The more valuable you are, the more difficult it will be for the company to get rid of you.

Mental State. Making a lot of money is usually the goal of most people, but what does a lot of money mean when you’re not happy with what you do. If you are not happy with your current job then chances are you will not perform to the standards that are expected of you. You must truly enjoy what you do and wake up every day (well at least most days) wanting to go to work because a new challenge awaits you. To be perfectly realistic, if you can not find the absolute dream job where you are happy, then you should find a new job where you will be happier than you are at your current job.