Congratulations, you have been found worthy in academic discipline and character, and now, you are a college graduate in debt. Pessimists will be quick to remind you that the economy is not what it used to be, that there are no jobs out there and that your earnings won’t be enough to cover your expenses.

However, these are exciting times because you get to have a say in determining how things pan out for you going forward. Here are four simple steps that you can take as a college graduate to improve your odds of financial success despite the dark clouds of pessimism in the air.

Identify your financial goals and prioritize them

To improve your odds of financial success, you should start by identifying financial goals so that you’ll make committed efforts to actualize them. For instance, many college graduates will have a ton of student loan debt; your first priority would ideally be to find ways to pay off student debt faster before you start chasing other financial goals.

You also need to define your idea of financial success so that you can know the exact steps you’ll need to take. For instance, if you want to retire at 40, you’ll have a different financial strategy from someone who wants to build and run a conglomerate like Warren Buffet’s Berkshire Hathaway.

Start investing as early as possible

Irrespective of what your financial goals are, you can’t underemphasize the importance of starting investing when time is on your side. The power of compound interest does wonders in helping the total value of your investment portfolio to grow exponentially. Unfortunately, it is easy to get carried away by pressing concerns instead of starting to invest because you’ll be thinking that you are still young.

For instance, a $5000 investment in an investment account earning 8% per annum when you are 20 years old would have compounded up to $180,000 by time you are 65. However, if you put $5000 in investment account earning 8% per annum when you are 40 years old, you’ll only have a compounded $40,000 by the time you are 65.

Automate your savings

Apart from your investments, you’ll also need to set money aside as savings to meet specific targets – you’ll also need to tuck away some money in an emergency savings account. However, you are not likely to find it easy to save money because you are young, you have few financial responsibilities, and you have fewer reasons to be worried about your financial future.

The best way to improve your savings game is to automate the savings process. You can start by leaving a standing order on your checking account – the standing order will move a certain amount from your checking account into a savings account every month.

Learn how to budget and apply the knowledge

Budgeting will help you keep your expenses in check because you’ll be able to keep impulse expenses to the minimum. One of the smartest ways to avoid running into financial trouble is to keep your expenses lower than your income consistently. If your income is higher than the value of your expenses, you’ll have some money left over that you can apply towards savings and investments. If your expenses is more than your income, you’ll have to borrow money to meet up with the difference, you’ll pay interest on the loans, and you’ll find it much harder to get out of the rut.

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