Skip to Content
Tally logo

Advice You Wish You Had After Graduating College

Post-college life presents challenges your kids might need help navigating. Here’s some advice — a few months in advance — to share with them.

October 26, 2021

The early years of your child’s career bring unprecedented levels of independence, even when compared to their time away at school. That’s an exciting prospect, but it also means having infinitely more responsibility, and adjusting to both can be a daunting prospect.

If your child is entering the workforce and asking for your opinion on what to do after college, here’s some advice for graduates you might wish you had when you were just starting.

Start saving and investing as soon as possible

Financial anxiety has been an issue in America for years, especially among young people. Gen Z and millennials have grown up amidst constant talk of stagnant wages, student loan debt, and rising housing and healthcare costs.

One way to insulate from financial stress is by saving a comfortable cash cushion. You can afford to worry a lot less about losing a job when you know you can go without one for a few months.

A healthy emergency fund can also grow into a future down payment on a house. Saving up enough money for a deposit is among the most significant obstacles to homeownership, so it's best to start working on it well in advance.

In addition, reaching the point where you can start investing early means your money has decades to grow, and compound interest works its magic best when you put it to work early.

Teaching your kids how to budget is one of the best things you can do to support their financial success. Show them how to balance their short-term saving needs with the marathon of retirement.

One great strategy is to build an emergency fund of at least a few months’ expenses, then start putting 20% or more of each paycheck toward retirement. That’s about how much it takes to build a healthy nest egg over a 40-year career.

Focus on housing and transportation costs

Housing expenses are the number one line item in the average American budget, and they can often make or break finances. Teach your children the importance of keeping housing costs down.

If you’re comfortable with letting your kids live with you for a few years after graduating, it’s a great way to help them get on their feet. If not, tell them not to forgo a roommate too soon. Once you do, you usually don’t want to go back.

After housing, transportation is the most significant expense for the average American. However, it’s also one of the easiest ones to reduce since people have complete control over their choice of vehicle and significant influence over their commute.

Encourage your children to buy modest vehicles in the early years of their career and work on finding a job after college that lets them live near the office or work remotely. Alternatively, help them navigate public transportation options near them to avoid buying a car entirely. Saving on a commute can free up a ton of room in a budget.

Negotiate your job offers

Negotiating a job offer can be stressful at any point in a career, but when you're entering the workforce, you have no experience to fall back on or use as leverage, and that makes it even harder.

Still, most people should be negotiating their pay and benefits from the start. More than half of workers don’t negotiate job offers, even though most employers are willing to negotiate, even with entry-level employees. Adding $5,000 to your first salary raises the floor for all your future roles. An extra $5,000 annually would mean you’d make $200,000 more over a 40-year career.

Successfully negotiating early in your career also helps build confidence and self-worth. Displaying those traits to your boss can pave the way for future promotions. If nothing else, it’s good practice for a skill you should be cultivating. 

Reassure your kids that it’s okay to negotiate, even if they’re recent college graduates. Teach them how to leverage multiple job offers and ask for more in a way that balances humility and confidence.

Start building your credit history early

Establishing your credit history is another journey that’s best to start as soon as possible. Even opening up a credit card and doing nothing with it is beneficial since increasing the average age of your credit accounts improves your score.

If your kid doesn’t have a credit card, help them apply for one. One of the best ways to start is with a secured credit card. They usually have lower qualification requirements and may even cater to college students or recent graduates.

Teach them how the credit system works, and show them how having a good credit score can save them money by reducing their interest rates.

For example, in October 2021, a 30-year fixed $300,000 mortgage would cost $174,182 with a 660 credit score. With a 760 credit score, it would be $138,445. That’s a $35,738 difference.

It’s also a good idea to set them up with a tool that can help them monitor their scores and reports, such as Credit Karma and Experian. Make sure they know that checking doesn’t lower their score.

Get a hobby that promotes good habits

Trying a new hobby or sport is an easy, actionable piece of advice for graduates that can make a lasting impact on their life. Hobbies usually don’t seem all that meaningful when you’re young, but they become exponentially more beneficial the older you get, for several reasons. 

Perhaps most importantly, it becomes a lot harder to make friends after graduating college. Your readily accessible pool of thousands of people your age disappears overnight. 

Having social, active things to do after college gets you out of the house and puts you in contact with people that have at least one interest in common with you. If you pick the right hobby, it can also serve as a way to get some mental and physical exercise.

They don’t have to be overly expensive or demanding, either. For example, suggest that they get involved with an adult sports league or start a hiking group with some friends from college that they’d like to keep in their lives.

Give yourself time to figure things out

A significant stressor for many young people is their desperation to figure out what they want to do with their lives. Things become simpler once you’re walking a clear path, if not easier, but finding one in the first place can be incredibly frustrating.

Some of the best advice for graduates is to let them know that they’ll figure things out eventually. It’s completely normal not to have every bit of your life planned out when you’re just getting started.

They’ll make mistakes along the way, and that’s okay. All they have to do is learn from those mistakes and move forward, especially since they have such supportive parents to help them.

If you’re searching for a tool to help your kids tackle credit card debt, consider Tally†. Tally can help your kids keep track of credit card debt and save money along the way. Find out more about how a lower-interest line of credit can help pay down credit card debt faster and automate their debt payments, so they always make them on time.

†To get the benefits of a Tally line of credit, you must qualify for and accept a Tally line of credit. Based on your credit history, the APR (which is the same as your interest rate) will be between 7.90% - 29.99% per year. The APR will vary with the market based on the Prime Rate. Annual fees range from $0 - $300.