Wondering how to manage your finances after college? well. Studies have revealed there are about 15,000 to 30,000 graduates in Kenya yearly. Unfortunately, with the high rates of unemployment, many graduates resort to blue-collar jobs. However, if you are fortunate, you start at an internship level where you earn from Ksh 15000 to Ksh 30000, and with the high living standards, this pay may not sustain you.
The initial years after graduating may not be a bed of roses, and with the little income, it is essential to have proper financial skills. Read on as we expound more on some crucial financial tips on how to manage your finances after college.
- Live according to your means.
There is a small per cent of your colleagues who will land good-paying jobs. This, however, should not pressure you to live like them. It may be hard since they are your friends and even family. But remember, everyone’s financial journey is different.
- Prioritize your expenses.
Right after graduating, you will no longer depend on your guardian or parent. Thus important to prioritize. Ask yourself, how often do you need to buy new clothes? How often do you need to go out? This may be hard to hear but, you do not have to attend all the parties, you do not have to buy new clothes every month.
- Start thinking of other income streams.
The tech era has come with both good and bad influences. However, one significant influence that the internet has brought about is the ability to earn from your phone or laptop. The list is endless on some of the ways you can earn online.
Try your hand in selling products online, setting up a website has become easier and faster, you can set up an online shop and maybe offer deliveries on Saturdays, this is a great way to supplement to your income.
Additionally, it is high time to start thinking of investing your money in stocks or bonds. This is not only another excellent saving tool, but also provides passive income.
- Use the 50/30/20 rule.
50% of your income should go to your rent, utility bills, insurance and transport. 30% of your income goes to your wants. These are things like gym membership, outings, new clothes or a new book. The other 20% should cater for debts and savings.
However, to make this rule work as a new graduate it is essential to reduce on the expenses, for instance, you do not need to take taxi services every day, instead, you can use public means, you may also not buy new clothes each month. This way, you will be able to put in the extra income into your savings.
After four, three or two years of studying, the joy of finally receiving that certificate and receiving the powers to read, the next hurdle in life will be how to handle your finances, and the reality is, life after graduation is not always easy. However, with the above tips, you are set to a greater tomorrow. But most importantly, always works towards becoming a better version of you.