Success After Graduating College

How to set yourself up for success right after graduating college

5 min read
Roman Shteyn

Graduating college is a great achievement, but it also represents a major transition into adulthood. The habits you establish now will lay the foundation for how successful you are in the decades to come. Here are the most important ways to build a better life for yourself after graduating college, as you begin your career.

Set a budget with savings targets

The most common mistake people make after graduating college is failing to save money and becoming part of the 78 percent of Americans living paycheck to paycheck. It’s easy to fall into the habit of paying your bills and spending the rest of your money every month, but there are three huge issues with this:

  1. You’ll be missing out on a prime opportunity to build wealth through compound interest.
  2. You won’t have an emergency fund.
  3. It’s difficult to start saving money later once you’re used to spending everything you make.

Here’s what you should do.

Set a budget with your income and expenses for each month.

A financial app is perfect for this. Dedicate separate portions of your income to a retirement account and an emergency fund. Contribute to the emergency fund until you have enough to cover three to six months of expenses.

Fund the retirement account every month.

Resist the temptation to put this off until later in life. Because of compound interest, retirement accounts grow much more the longer they’re open. The difference between saving for 30 years and saving for 40 years can be hundreds of thousands of dollars.

Build a professional network

Networking After Graduating College

You probably started building your professional network in college, and you should continue to make new connections and stay in touch with old ones after graduating college. A LinkedIn profile is a must, as it’s an excellent way to connect with people in your industry.

You can also meet like-minded professionals at work and at business conferences. Explore new social circles, which you can find through resources like Meetup. You can search for networking and social events based on your hobbies, interests, or industry. It’s a great way to make new friends if you’re moving to a new city after graduating, too!

If you can find someone who has already achieved success and is willing to mentor you, it’s one of the best ways to learn and connect with influential people in your industry.

Although this might sound difficult, people often enjoy sharing their insights. Even if they don’t take you under their wing, you could still meet with them on occasion to pick their brain.

Build a high credit score

Your credit score is essentially a rating of how likely you are to repay what you borrow. As such, it affects whether you receive approval on loans and credit cards, and your interest rate if you’re approved. That’s not all, though, as it can also affect car insurance rates, rental applications you submit, and even whether you’re hired for certain jobs after graduating college.

The time to start thinking about your credit score isn’t when you need to pass a credit check.

By then, it’s too late. Although many factors affect your score, payment history and credit utilization have the biggest impact.

Here’s the simplest way to build your score when starting from scratch:

  1. Apply for a credit card. It’s best to start with a card that doesn’t have an annual fee, like one of these.
  2. Use the card for at least one purchase per billing cycle.
  3. Note the credit limit and never let the balance go over 30 percent of this amount.
  4. Pay your statement balance by the due date. By always paying the statement balance, the card issuer will never charge you interest.

With this approach, you’ll have a stellar payment history and credit utilization, which will quickly increase your score.

Maximize earning potential after graduating college

Watching your spending is common financial advice, but there’s only so much you can cut without affecting your quality of life after graduating college. While it’s smart to avoid overspending, prioritize boosting your income over being militant about your expenses. A small raise will put you in a much better position financially than the typical suggestion to stop buying your morning coffee.

Even though it might be tough to get a large salary right after graduating college, if you perform well and prove to be a valuable asset, you’ll give yourself leverage to obtain a substantial raise.

Keep track of any metrics that measure your performance and research what the salary range is for your position. Once you know your worth, you can make sure that you’re compensated accordingly.

It’s tempting to live in the moment after graduating college, but getting into the right habits early on will set you up for long-term success. You’ll reach financial milestones much earlier, and you won’t end up as one of the many people stressed about money.