Good Morning Green Panda Friends.  Let me ask you a question, what is your problem? As college students and young adults in our twenties we may all be faced with several financial problems in our daily lives.  As we try to graduate from college, get a job, and start our lives we are bound to experience some financial problems as we learn about budgeting, money management, saving money, debt repayment, and investment strategies.

Here are some common financial problems and ways to solve them:

 

Problem: Your Personal Budget

If you are a recent college graduate your biggest financial problem may be that you don’t have any (or enough) money.  You may still be searching for a full time job and you may be trying to pay off your student loans while living on a very low income.

The key to making a personal budget is to live within your means. A personal budget is all about using what you’ve got.

How to Solve It:

Sit down and make a list of your monthly income and also make a list of all your basic monthly expenses.  Basic monthly expenses are the bare minimum costs of living such as housing and food.  If you can cut costs by walking instead of taking public transportation you can save some money each month.

If your expenses are more than your income you will either have to find a second job or a full time job in order to earn more income each month or you will have to make cuts in your expenses. Cable and eating out are not necessities. Also check your cell phone bill; are you going over your basic plan data usage and phone minutes?

 

Problem: Money Management

Maybe you have a full time job and maybe you are earning a good income, but at the end of each month you are still broke. This is not a budget problem it is a money management problem. You have to learn how to properly spend and save your money. Basically you have to set financial priorities and decide exactly where and how you want to spend and save your money.

How to Solve It: Don’t feel that just because you make money you can spend it wherever and however you want. If you have been a broke student for many years I know that it can be very tempting to want to spend all of your pay check the same day that you get paid. But this is irresponsible and definitely not smart money management.

You have to decide what is important to you and that is where you should spend the largest percentage of your pay check.  It’s not a smart idea to spend all of your money on personal expenses and entertainment because you will be very sorry if you ever have a financial emergency.  Give yourself a spending treat once a week, once a pay check, or once a month; then you won’t feel so deprived by not spending any money at all.

 

Problem: You Have A Lot of Debt

Recent college graduates are notoriously known for having a lot of student debt and if you don’t have the income to repay your debts it can become an even bigger problem.  For some reason people get in the habit of repaying their debts with other debt but this is not a smart financial strategy.

How To Solve It: Stop spending.  The way to get out of debt is not to continue accumulating debt. Make repaying your debt your number one financial priority and allocate as much of your monthly budget as you can to repaying your debt. After your basic living expenses of food and housing are paid your debt repayment should the next highest expense.

 

Photo by mykl