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The Essential Money-Management Checklist for College Grads

Samantha Rose
Samantha Rose is a personal finance writer covering financial literacy for OppU. Her work focuses on providing hands-on resources for high school and college-age students in addition to their parents and educators.
Read time: 12 min
Updated on April 8, 2022
The path to adulting made easy.

Welcome to adulthood, college graduates! It’s an exciting time, but one riddled with pitfalls —  including financial missteps

Gaining control of your finances is the best way to structure the other areas of your life. Score a raise. Secure a better apartment. By focusing on your finances, you’ll create direction for the future.

It’s hard to know where to begin when everything is new. Here’s a checklist of 14 financial must-dos to get you started.

No. 1: Create a budget

Ever wonder where all your money goes? Then it’s time to create a budget

A budget is a great first step to creating a financial plan, which dictates how your money can work for you in the future. But save a comprehensive financial plan for later down the road. For now, learn how to master the art of budgeting.

To create a budget, review your bank account statements and bills to determine income and expenses. List monthly expected income streams. This includes a salaried job, a side hustle, and any passive income or investments. List monthly expenses, including fixed and flexible bills. This includes costs like rent or a mortgage, groceries, and debt payments.

How can a budget help? It prioritizes your financial needs and wants based on your income. For instance, housing is often the biggest budget buster. A good rule of thumb is that about 30% of your monthly paycheck should go toward housing. To fit housing within your budget, consider factors including the cost of living, cost-sharing — like splitting bills with roommates -- and your lifestyle expectations. Replicate this process with each budget category.

A budget isn’t set in stone. It changes over time, depending on your financial circumstances. For example, if you move from a dorm to a first apartment, you’ll have different expenses — like rent, utilities, and furniture. It’s normal to have a flexible budget, but it needs to be up-to-date to work properly.

There are different kinds of budgets depending on your financial needs. Choose whichever works best for you.

Envelope budget

An envelope budget uses cash and envelopes to track expenses. Place the cash in categorized envelopes and only spend the designated amount.

50/30/20 budget

The 50/30/20 budget focuses on three broad expense categories: needs, wants, and savings.

80/20 budget

The 80/20 budget prioritizes savings and allows the budgeter to spend the remainder on whatever they choose.

No. 2: Open a banking account

An account is a financial tool that benefits everyone. Banks, credit unions, and other financial institutions allow account holders to track, spend, and save money. In fact, an employer often requires an account in order to set up direct-deposit for paychecks. If you don’t already have one, consider opening a bank account.

Start by researching a potential financial institution. Here are some questions to get you started:

Is the provider located in your city?

ATMs and physical branches should be readily available. 

Is the provider trusted?

Ask around. A lot of people have strong opinions about why their bank, credit union, or institution is the best — or worst — choice. 

Does the provider offer perks?

For instance, a national bank differs greatly from a local credit union in services and offerings. 

Ultimately, don’t settle for less. You should trust the financial institution you choose for a banking account.

No. 3: Know your grace period

A grace period is a set amount of time on student loans — typically six months — that allows borrowers to adjust financially after college.

Interest still accrues during the grace period. Students may choose to pay the interest that accrues, preventing having the interest added to the principal balance.

Federal student loans enter a grace period once the loan holder graduates, drops below half-time enrollment, or leaves school. Not all federal student loans have a grace period. And many private student loans don’t offer a grace period.

Contact your loan servicer to determine if a grace period is offered on your student loans, and if so, for how long.

No. 4: Choose a repayment plan

It’s important for college graduates to understand the responsibility of having and paying off student loan debt. You signed a contract, so don’t ignore the commitment. That’s a guaranteed way to rack up fees and penalties, which can negatively impact your credit score. Instead, determine your total student loan debt and create a system to pay it off ASAP.

Choose a student loan repayment plan. There are several plans available, depending on whether a student loan is federal or private. Explore all the options based on your personal financial situation. 

“There are now many more choices for loan repayment than in the past,” said Abril Hunt, the manager of Outreach & Financial Literacy for ECMC. 

“Make sure you choose a repayment plan where you’ll be able to make your payments every month and still live comfortably. Borrowers should consider their estimated income, other financial commitments, the length of time they will be repaying their loan, and the total amount of interest they will repay over the life of their loan.”

For instance, the federal government offers four different types of income-driven repayment plans. These plans will often lower your monthly bill based on your current income and family size. Payment can even be reduced to $0 if you are unemployed or earn below a certain threshold. 

When a student loan enters repayment, a servicer will place the loan holder on a standard repayment plan, unless otherwise directed. Request a different repayment plan before this occurs. 

For federal student loans, there are eight different repayment plans to choose from, including:

  1. Standard Repayment Plan
  2. Graduated Repayment Plan
  3. Extended Repayment Plan
  4. Revised Pay As You Earn Repayment Plan (REPAYE)
  5. Pay As You Earn Repayment Plan (PAYE)
  6. Income-Based Repayment Plan (IBR)
  7. Income-Contingent Repayment Plan (ICR)
  8. Income-Sensitive Repayment Plan

Each repayment plan has pros and cons. Research each plan and choose the one that makes the most sense for your current financial situation.

Private student loan lenders aren’t obligated to offer financial assistance, such as a repayment plan. Thus, private lenders don't offer as many flexible repayment plans as federal student loans.

No. 5: Get loan details

Between federal and private student loans, subsidized and unsubsidized, a borrower might forget how much they owe and to whom.

Learn the details of your student loans. Often this will be done in student loan exit counseling for any federal loans received. The U.S. Department of Education requires exit counseling to prepare borrowers for repayment. 

Whether you complete the exit counseling or not — determine the key facts about your loans:

  • Loan servicer
  • Total balance
  • Minimum payment
  • Due date
  • Interest rate
  • Loan term
  • Payment plan
  • Account login

Typically, the loan servicer will provide these details on the account login page. Keep a list of pertinent information, including any changes.

No. 6: Revisit your student loan 

If your student loans aren’t working, then adjust as necessary. Consolidation or refinancing is a great option for borrowers who need more flexibility with repayments. 


Consolidation is the process of combining several small loans into one larger loan. Instead of multiple loan payments, the larger loan has a single payment due each month. A consolidated loan also offers a new opportunity for repayment plans, which can make payments more manageable.

Federal student loan consolidation is a government process, while private student loan consolidation occurs through private lenders. Visit the federal student aid website to learn more about a federal direct consolidation loan.


Student loan refinancing is another option. It’s the process of taking out a new loan to repay existing loans — often for a lower interest rate. The federal government doesn’t offer student loan refinancing. In order to refinance federal and private student loans, the borrower would need to refinance through a private lender.

No. 7: Research credit cards

Yes, credit cards are an effective way to build a healthy credit history. But they also come with risks — if not properly managed. On-time payments will help. Missed payments will hurt — with potentially severe consequences. 

Compare credit cards based on the interest rate, fees, and other terms and conditions. Consider the source of the lender, such as a bank versus a retail outlet. Understand the applicable fees and how to avoid them. Weigh the perks of a rewards program versus an annual fee.

Avoid overspending by being realistic about how much you can actually afford. That means not relying on credit cards for unnecessary purchases outside of your budget. 

Answer these questions each time you make a credit card purchase. If the expense is nonessential and can’t be paid off in full, then reconsider.

  • What is the interest rate for each credit card? 
  • Can you afford to pay the full balance? 
  • When is the payment due? 

No. 8: Check your credit score

A credit report determines the adult equivalent of a GPA: a credit score. Credit scores range from 300 to 850. A credit score of 800 or above is considered excellent.

A good credit score can lead to financial advantages, such as lower borrowing costs and cheaper premiums. Protect your credit by consistently reviewing your credit report. Report any fraudulent charges or reporting errors immediately to the creditor.

Consumers are entitled to one free copy of their credit report every 12 months from each of the three nationwide credit reporting companies: Equifax, Experian, and TransUnion.

Do you have a low credit score?

There are a few tactics to improve a credit score, including:

  • Paying credit cards, student loans, and other loans consistently and on time 
  • Maintaining a certain number of open accounts in good standing
  • Keeping credit card balances below a 30% utilization rate
  • Building new credit and maintaining old credit history

No. 9: Pay off existing credit card debt

Remember, credit is borrowed money and needs to be repaid. The best way to avoid credit card debt is not to borrow more than you can afford. But life happens, and sometimes you need to rely on credit. If that’s the case, take steps to pay it off ASAP before interest charges rack up.

If you already have credit card debt, it can be overwhelming. That’s why it’s important to pay at least the minimum payment. It keeps your credit card account in good standing while also avoiding missed payments and late fees.

To ensure you make at least the minimum payment, “set payments on autopay for all accounts,” said Brent Dunn, a financial planner at Wholesome Financial Partners Inc.

The trouble with paying the minimum amount due is that it is the bare minimum. The minimum payment will rack up interest on the remaining balance due. It also extends the life of your debt. Go beyond the minimum payment to create a solid plan to pay off your debts. 

To pay off credit card debt, work toward a payoff date — this gives you a concrete goal of when you will be debt free and how much you need to pay each month to make it happen. Then choose a repayment strategy: the avalanche method or snowball method.

Continue to pay your credit card balance each month. If you can’t pay your balance in full, then commit to an aggressive credit card debt payoff plan.

There are two effective repayment strategies: 

The snowball method 

The snowball method targets debt in order of smallest to largest. 

The avalanche method

The avalanche method focuses on paying off high-interest debt first.

No. 10: Build an emergency fund

No one wants to live with uncertainty, but about 63% of Americans are living paycheck to paycheck, according to a recent study. This can lead to stress and worry pending an unforeseen setback, including a job loss, medical bill, or other unexpected costs.

The best way to prepare for the unexpected — to whether short-term setbacks and long-term — is to prioritize savings. 

Create an emergency fund to boost your financial health. An emergency fund is money that is set aside in preparation for a worst-case scenario. By setting aside money to cover the unexpected, you’re protecting yourself against risk, like racking up debt. A few hundred dollars is a great start to a rainy day fund (although many financial experts recommend saving at least three to six months’ worth of expenses in a dedicated emergency fund). 

No. 11: Set a financial goal

Short- and long-term financial goals are crucial to achieving financial happiness. There are many reasons to set financial goals early on — especially when it comes to saving.

Financial goals provide structure to expenses, savings, and investments. They also allow the goal-setter to prioritize future costs, such as an emergency fund, a down payment, and retirement. For example, get excited about saving with a savings goal

Ultimately, your financial goals matter less than you creating a habit of goal setting and contributing toward it.

Remember that some goals will take longer to complete. That’s where short-term goals come in. These monthly or yearly goals allow you to create manageable steps on the path to achieving a larger goal 10 or 20 years down the line.

No. 12: Contribute to a retirement plan

In terms of priorities, an emergency fund should take precedence for recent grads. But if an employer offers a retirement account with matching contributions, There’s no time like the present to start saving for the future — especially if you plan to reap the benefits of compound interest. 

The two popular options are a 401(k) or a Roth IRA. Both investment vehicles have pros and cons depending on your preference of how you prefer to be taxed.

Money placed into a 401(k) is pretax dollars, meaning you won’t be taxed on it until withdrawal. That also means you’re effectively placing more money into the account to accrue interest. 

If your employer offers a retirement plan with matching contributions, there’s very little reason not to take advantage of the benefit. It’s money that your employer adds in a percentage of each dollar you contribute — up to a certain limit.

Don’t have a 401(k)? Freelancers and those without the option to invest in a company retirement fund can open a Roth IRA account. Money in an IRA is deposited after being taxed, or post-tax dollars. The main benefit of an IRA is that there are no taxes due upon withdrawal. This is a great option for those who believe their tax situation may significantly change by the time they withdraw, or 40 years in the future.

No. 13: Protect personal information

People with malicious intent want to gain your personal information. It’s a fact. Be prepared to safeguard your information, especially your financial information. 

But there are steps you can take to protect your accounts.

  1. Organize and shred personally identifying information, such as bank statements or credit card offers. 
  2. Keep your digital accounts secured with unique passwords. 
  3. Don’t hand out your Social Security Number unless required. And even then, make sure only qualified professionals are handling your information.

No. 14: Buy insurance

No one is invincible or immune from loss. Luckily, there are insurance plans to cover expenses in times of adversity — like illness, injury, or death. 

Insurance is a means of protection from a monetary loss. There are several ways to buy and use insurance, so research different insurers depending on what makes the most sense financially. A few of the most common insurance policies include:

  • Health, dental, and vision insurance
  • Disability insurance
  • Renters or homeowners insurance
  • Auto insurance
  • Life insurance

No. 15: Take advantage of digital resources

Young adults are the technology generation. They are tech-savvy and thrive off of using online resources and apps. The good news is that there are countless digital resources to increase your financial literacy skills and knowledge. Take a financial literacy course like OppU, which offers a standards-aligned curriculum for free.

And it doesn’t stop there. Online tools are often a simple and efficient way to keep track of your personal finances. 

For example, paying your online bills can be a headache. So why not automate the process with automatic bill pay? If you’re interested in starting a budget, consider using a budgeting app to automatically track your income and spending. 

Whatever your financial need, chances are there’s a digital resource to help. 

Bottom line

The structure that college provided is gone. It’s time to step up and “adult.” A solid financial foundation will serve you well into the future.

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