Comments on: Freshly Graduated And About To Get A New Job? Here Are Seven Things To Do To Get Started On The Right Financial Path http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/ Simple, applicable personal finance advice for the modern world Sun, 22 Nov 2009 01:08:33 -0800 http://wordpress.org/?v=2.8.4 hourly 1 By: Phil A http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/comment-page-1/#comment-161008 Phil A Mon, 21 Jan 2008 21:28:28 +0000 http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/#comment-161008 Not all companies offer a match. I would contribute to a Roth IRA at a highly touted Mutual Fund Company if there is no match. Contributing to a 401(k) without a match isn't a bad idea. You are still increasing your chances of a more secure retirement. Not all companies offer a match. I would contribute to a Roth IRA at a highly touted Mutual Fund Company if there is no match. Contributing to a 401(k) without a match isn’t a bad idea. You are still increasing your chances of a more secure retirement.

]]> By: steven http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/comment-page-1/#comment-56649 steven Mon, 13 Aug 2007 02:31:04 +0000 http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/#comment-56649 @wil Hi Wil, The Vanguard Target Retirement 2050 Account sounds like an IRA (Independent Retirement Account). If your company doesn't offer a 401K, you can start your own Roth IRA. I highly recommend Beth Kobliner's book, Get A Financial Life. It's the best financial book I have ever read for young people in their twenties and thirties. @wil

Hi Wil,

The Vanguard Target Retirement 2050 Account sounds like an IRA (Independent Retirement Account). If your company doesn’t offer a 401K, you can start your own Roth IRA.

I highly recommend Beth Kobliner’s book, Get A Financial Life. It’s the best financial book I have ever read for young people in their twenties and thirties.

]]> By: Wil http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/comment-page-1/#comment-55532 Wil Thu, 09 Aug 2007 20:18:45 +0000 http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/#comment-55532 I am a little confused! It makes sense to me to contribute to my 401k, especially because of the company matching that I receive. The emergency fund/savings account is also an obvious choice. I am confused by the Vanguard investment. Is this something in between a 401k (you can't really touch until you retire) and a savings account (you can easily take money out of and put money into)? Maybe I'm thrown off by the name - is it really a retirement account, or is it something different altogether? I am a little confused! It makes sense to me to contribute to my 401k, especially because of the company matching that I receive. The emergency fund/savings account is also an obvious choice.

I am confused by the Vanguard investment. Is this something in between a 401k (you can’t really touch until you retire) and a savings account (you can easily take money out of and put money into)? Maybe I’m thrown off by the name – is it really a retirement account, or is it something different altogether?

]]> By: Michelle http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/comment-page-1/#comment-53367 Michelle Fri, 03 Aug 2007 16:13:15 +0000 http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/#comment-53367 I agree, if you will be spending money do it on experiences and not stuff. I was lucky enough to be able to go to Europe for a month after I graduated and before I had a real job. I was considering not going because of the expense and loss of income, but realized I will never again until I am retired be able to take a month off of work without jeopardizing my career or future family. I never regret this decision, I paid it all back on my credit cards already and will never forget that experience, while stuff I bought a few years ago I have already lost or replaced. I agree, if you will be spending money do it on experiences and not stuff. I was lucky enough to be able to go to Europe for a month after I graduated and before I had a real job. I was considering not going because of the expense and loss of income, but realized I will never again until I am retired be able to take a month off of work without jeopardizing my career or future family. I never regret this decision, I paid it all back on my credit cards already and will never forget that experience, while stuff I bought a few years ago I have already lost or replaced.

]]> By: guinness416 http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/comment-page-1/#comment-53308 guinness416 Fri, 03 Aug 2007 14:06:51 +0000 http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/#comment-53308 I'd add taking as much company-paid professional development/education/conference attendance/etc opportunities as you can whilst young. They open up doors for other career moves, and you don't always have the time or inclination to take them when you're older. And fit gym time into your professional schedule as early as possible. Make it a habit for a lifetime. I’d add taking as much company-paid professional development/education/conference attendance/etc opportunities as you can whilst young. They open up doors for other career moves, and you don’t always have the time or inclination to take them when you’re older.

And fit gym time into your professional schedule as early as possible. Make it a habit for a lifetime.

]]> By: kim http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/comment-page-1/#comment-53225 kim Fri, 03 Aug 2007 08:33:21 +0000 http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/#comment-53225 i'm a fresh graduate, working in a mutual fund company. i've always wanted to learn the ropes on how to invest my money wisely. i plan to invest 30% of my salary to this mutual fund company, 30% to a savings account in a bank, 30% for my expenses, and 10% for leisure. can anyone give me a better advice? thank you. i’m a fresh graduate, working in a mutual fund company. i’ve always wanted to learn the ropes on how to invest my money wisely. i plan to invest 30% of my salary to this mutual fund company, 30% to a savings account in a bank, 30% for my expenses, and 10% for leisure.

can anyone give me a better advice?
thank you.

]]> By: Trent http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/comment-page-1/#comment-53139 Trent Fri, 03 Aug 2007 02:13:19 +0000 http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/#comment-53139 I no longer have referral codes for ING Direct, as I've stated in other threads. That's why I no longer mention them. I no longer have referral codes for ING Direct, as I’ve stated in other threads. That’s why I no longer mention them.

]]> By: Sharon http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/comment-page-1/#comment-53096 Sharon Thu, 02 Aug 2007 23:48:11 +0000 http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/#comment-53096 I agree with the spending money on experiences rather than stuff. Life has a habit of sneaking up on you and so do what you can now. The housing market has skyrocketed, but that bubble will probably burst and if you have money saved, you will be better prepared. However, your children will need to be cared for and if you don't have them, your parents will be ill eventually. Don't go into debt for these experiences, just do what you can. It is also cooler and easier for a person in their twenties to do Europe on twenty dollars a day than a woman in her forties... I agree with the spending money on experiences rather than stuff. Life has a habit of sneaking up on you and so do what you can now. The housing market has skyrocketed, but that bubble will probably burst and if you have money saved, you will be better prepared. However, your children will need to be cared for and if you don’t have them, your parents will be ill eventually. Don’t go into debt for these experiences, just do what you can. It is also cooler and easier for a person in their twenties to do Europe on twenty dollars a day than a woman in her forties…

]]> By: Matt http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/comment-page-1/#comment-53091 Matt Thu, 02 Aug 2007 23:31:20 +0000 http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/#comment-53091 I just graduated with about $14,000 in private loans at prime + 0% which right now is 8.25% and $12,000 in federal loans at about 5% but will be much less once all the discounts are added in. I am going to be paying them off as fast as I can. Why not? This is my only debt. I can't imagine still paying for them in 10 years. I am doing as much as I can to pay them off fast. I'm currently looking for a part time job(hopefully one that offers tuition reimbursement) and I'm going to devote that paycheck solely to student loans in addition to paying double the minimum with my regular paycheck. I'm also going to continue contributing the max to my Roth IRA. My roommates both make at least $10,000 per year more than me and had college paid for them by wealthy relative yet complain constantly that they are 'poor.' It's nice knowing that although I make much less money than them I feel I am in a much better position financially then they are...and it feels good. They always ask if I 'have enough money' for whatever bill is due but the irony is that I probably have more money in an emergency fund to cover expenses like that than they have in their bank accounts combined. I've tried helping them, because they ask frequently, but don't want to change any of their ways or do any work on their part. I just graduated with about $14,000 in private loans at prime + 0% which right now is 8.25% and $12,000 in federal loans at about 5% but will be much less once all the discounts are added in.

I am going to be paying them off as fast as I can. Why not? This is my only debt. I can’t imagine still paying for them in 10 years. I am doing as much as I can to pay them off fast. I’m currently looking for a part time job(hopefully one that offers tuition reimbursement) and I’m going to devote that paycheck solely to student loans in addition to paying double the minimum with my regular paycheck.

I’m also going to continue contributing the max to my Roth IRA.

My roommates both make at least $10,000 per year more than me and had college paid for them by wealthy relative yet complain constantly that they are ‘poor.’ It’s nice knowing that although I make much less money than them I feel I am in a much better position financially then they are…and it feels good. They always ask if I ‘have enough money’ for whatever bill is due but the irony is that I probably have more money in an emergency fund to cover expenses like that than they have in their bank accounts combined. I’ve tried helping them, because they ask frequently, but don’t want to change any of their ways or do any work on their part.

]]> By: Matt http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/comment-page-1/#comment-53070 Matt Thu, 02 Aug 2007 22:34:24 +0000 http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/#comment-53070 I also disagree with not paying extra on student loans. I have $17k at a floating rate of prime + 2.5%. Currently that equals 8.75% in Canada. My plan is to pay 20% of my gross salary to my student loan debt plus the extra "3 month paycheque." According to my plan it should be paid off in about 1.5 years. For me, I would rather get it out of the way than have it linger on. I should mention though, I live pretty frugally and also will be saving over 12% of my gross salary as well. So I guess I'm not being extremely aggressive towards the loans. I also disagree with not paying extra on student loans. I have $17k at a floating rate of prime + 2.5%. Currently that equals 8.75% in Canada. My plan is to pay 20% of my gross salary to my student loan debt plus the extra “3 month paycheque.” According to my plan it should be paid off in about 1.5 years. For me, I would rather get it out of the way than have it linger on.

I should mention though, I live pretty frugally and also will be saving over 12% of my gross salary as well. So I guess I’m not being extremely aggressive towards the loans.

]]> By: Jessica http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/comment-page-1/#comment-53037 Jessica Thu, 02 Aug 2007 21:12:00 +0000 http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/#comment-53037 I disagree about not making extra payments on your student loans. If you have no other debt it makes sense to pay these loans off sooner than later-and I'm fairly sure that the interest rate on student loans does not go beyond 8%. (I'm not 100% on that one, but that's what I seem to remember with my federal student loans.) Of course, it would make sense to establish a solid amount of savings first before doing so, for emergencies and what not. For myself, I'm trying to work up to switching from the graduated payment plan to the standard plan, even though I have a 2.5% rate on my loans. The graduated plan has been very helpful to me in these first few years out of school (and during my two years of grad school)but my husband and I don't want to be paying our student loans off at 40, and forking over that much more in interest. The other points are great, however, I've seen a lot of post-grad friends use the "experience" reason to load up on debt. For some reason that intangible "experience" translates into justifying a want as a need. I figure a lot of the traveling I want to do will still be there and fun in five years or even forty. Turning 30 shouldn't be some kind of deadline for cramming experiences/adventures in. (Or whatever age is "old" to a person) I disagree about not making extra payments on your student loans. If you have no other debt it makes sense to pay these loans off sooner than later-and I’m fairly sure that the interest rate on student loans does not go beyond 8%. (I’m not 100% on that one, but that’s what I seem to remember with my federal student loans.)

Of course, it would make sense to establish a solid amount of savings first before doing so, for emergencies and what not.

For myself, I’m trying to work up to switching from the graduated payment plan to the standard plan, even though I have a 2.5% rate on my loans. The graduated plan has been very helpful to me in these first few years out of school (and during my two years of grad school)but my husband and I don’t want to be paying our student loans off at 40, and forking over that much more in interest.

The other points are great, however, I’ve seen a lot of post-grad friends use the “experience” reason to load up on debt. For some reason that intangible “experience” translates into justifying a want as a need. I figure a lot of the traveling I want to do will still be there and fun in five years or even forty. Turning 30 shouldn’t be some kind of deadline for cramming experiences/adventures in. (Or whatever age is “old” to a person)

]]> By: s http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/comment-page-1/#comment-53036 s Thu, 02 Aug 2007 21:08:19 +0000 http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/#comment-53036 Paying down student loans early can go either way, but I'd think usually (at the current student loan rates at least), it'd be better to pay off quick. My loans were at almost 8% when I graduated last year (I couldn't consolidate at the ~6.5% rate because of how my loans were taken out. Fortunately, I only had about 15k in loans, and I was able to pay it off within 6 months of graduating with a very aggressive repayment schedule. Being completely debt free less than a year out of school felt GREAT. And now, I've just put a down payment on my first house. Since I'm getting a better rate on the mortgage than I had on my loans, it's pretty clearly a better choice to have paid off the student loans. In general though, just like pre-paying a mortgage, it's a matter of whether you think you can "beat" the interest rate of the loan. My cutoff for where I feel comfortable with the risk is about 7%. I'll pay off any loan higher than that as quickly as possible, and let anything below stick around with minimum payments. Paying down student loans early can go either way, but I’d think usually (at the current student loan rates at least), it’d be better to pay off quick.

My loans were at almost 8% when I graduated last year (I couldn’t consolidate at the ~6.5% rate because of how my loans were taken out. Fortunately, I only had about 15k in loans, and I was able to pay it off within 6 months of graduating with a very aggressive repayment schedule. Being completely debt free less than a year out of school felt GREAT. And now, I’ve just put a down payment on my first house.

Since I’m getting a better rate on the mortgage than I had on my loans, it’s pretty clearly a better choice to have paid off the student loans.

In general though, just like pre-paying a mortgage, it’s a matter of whether you think you can “beat” the interest rate of the loan. My cutoff for where I feel comfortable with the risk is about 7%. I’ll pay off any loan higher than that as quickly as possible, and let anything below stick around with minimum payments.

]]> By: Cindy http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/comment-page-1/#comment-53030 Cindy Thu, 02 Aug 2007 21:00:11 +0000 http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/#comment-53030 Hi Trent, I'm trying to follow your savings advice - please send me a referral code for ING Direct. Can you send it soon??? (Third time asking) Thanks, Cindy Hi Trent,

I’m trying to follow your savings advice – please send me a referral code for ING Direct. Can you send it soon??? (Third time asking)

Thanks,
Cindy

]]> By: Mark A http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/comment-page-1/#comment-53024 Mark A Thu, 02 Aug 2007 20:31:27 +0000 http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/#comment-53024 Cultivating connections is ultimately how I got the job I have, and the reason I'm being considered for advanced positions in the future. It helps to impress the president of your organization. Cultivating connections is ultimately how I got the job I have, and the reason I’m being considered for advanced positions in the future. It helps to impress the president of your organization.

]]> By: Jake Smith http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/comment-page-1/#comment-53022 Jake Smith Thu, 02 Aug 2007 20:22:08 +0000 http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/#comment-53022 Considering that I begin work in a week's time - thanks for the advice! I especially like the last pointer on concentrating on experiences as opposed to accumulating stuff... Considering that I begin work in a week’s time – thanks for the advice! I especially like the last pointer on concentrating on experiences as opposed to accumulating stuff…

]]> By: js http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/comment-page-1/#comment-53021 js Thu, 02 Aug 2007 20:19:45 +0000 http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/#comment-53021 I wouldn't mind going back and buying stuff (ie property) when I was younger. The housing bubble in CA, has now made all that permanently unaffordable. Oh but I was young and dumb, and didn't mind renting then. Now I'll be renting for life. I wouldn’t mind going back and buying stuff (ie property) when I was younger. The housing bubble in CA, has now made all that permanently unaffordable. Oh but I was young and dumb, and didn’t mind renting then. Now I’ll be renting for life.

]]> By: rstlne http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/comment-page-1/#comment-53013 rstlne Thu, 02 Aug 2007 20:00:29 +0000 http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/#comment-53013 I wasn't allowed to sign up for the 401K plan until I had been here for a year, so of course, it depends on the policies at your company. But do sign up as soon as you qualify. I wasn’t allowed to sign up for the 401K plan until I had been here for a year, so of course, it depends on the policies at your company. But do sign up as soon as you qualify.

]]> By: Brian http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/comment-page-1/#comment-53012 Brian Thu, 02 Aug 2007 19:58:09 +0000 http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/#comment-53012 Randy Peterman: That pyramid would be a horrible asset allocation for new graduates...if that pyramid were inverted, then it might work ;) Randy Peterman:

That pyramid would be a horrible asset allocation for new graduates…if that pyramid were inverted, then it might work ;)

]]> By: E http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/comment-page-1/#comment-53011 E Thu, 02 Aug 2007 19:55:12 +0000 http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/#comment-53011 Why not pay extra towards student loans? I say, if your student loan(s) are your only debt right out of college, pay them down aggressively (unless there's a pre-payment penalty which I can't imagine there'd ever be) to get yourself debt free as soon as possible. Why not pay extra towards student loans? I say, if your student loan(s) are your only debt right out of college, pay them down aggressively (unless there’s a pre-payment penalty which I can’t imagine there’d ever be) to get yourself debt free as soon as possible.

]]> By: Randy Peterman http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/comment-page-1/#comment-53005 Randy Peterman Thu, 02 Aug 2007 19:37:57 +0000 http://www.thesimpledollar.com/2007/08/02/freshly-graduated-and-about-to-get-a-new-job-here-are-seven-things-to-do-to-get-started-on-the-right-financial-path/#comment-53005 Trent, what do you think about tiering your 401(k) portfolio using something like the pyramid investment model? That way the person can have some more secure investments in play that are safer? This is <a href="http://watchmymoneymaker.com/2007/07/02/the-investment-pyramid/" rel="nofollow">the way I am investing my money</a> but maybe because of the general youth of many graduates you're assuming a higher risk tolerance? Trent, what do you think about tiering your 401(k) portfolio using something like the pyramid investment model? That way the person can have some more secure investments in play that are safer?

This is the way I am investing my money but maybe because of the general youth of many graduates you’re assuming a higher risk tolerance?

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