It can be scary enough to go from school to work without having to worry about all the other responsibilities that come with it. But don’t worry—here are our best tips for how to handle your money after you graduate.

1. Know how you spend your money.

Before you start this new part of your life, it can help to think about where you’ve been and where you want to go. Understanding how you spent and saved money in the past is a good place to start if you want to make it through this time of big financial changes.

Maybe you tend to spend more than you want to when you’re out with friends or with other people. Maybe you order dinner or do online shopping as a treat for yourself after a stressful day. You might not spend much money, and you might be very good at keeping track of your transactions and keeping an eye on your account balance.

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None of these things are inherently good or bad. They are just preferences and habits that people develop when it comes to money and spending. But it’s never a bad thing to know more about yourself, so taking the time to think about and figure out your money personality can help you predict your spending habits and, if necessary, change them to fit your current financial situation.

2. Make a budget and stick to it

A budget is just a plan for your money, and when it comes to money, it’s best not to take things by the seat of your pants. That doesn’t mean you can’t be spontaneous, and it doesn’t have to be perfect, but you should have a good idea of how much money is going in and out of your account(s). So, you won’t spend more than you want to or get into debt because you spent money you might not have.

There are many ways to make a budget, but they all help you answer the same question: what are your financial inputs and what are your financial outputs? How much money do you make and how much do you spend? Once you get your finances in order, you’ll be better able to predict how they’ll be on any given day.

For making a budget, you can use this free budgeting calculator, look at some apps and software, or try the simple 50/30/20 rule. For big expenses and financial goals, you can also divide things into the short term and the long term. A good first step is to make a list of all of your recurring bills and when they are due. Keep everything in one place, whether that means putting all of your paper bills in one folder or having all of your electronic bills sent to one email address.

3. Make a plan to save money

One way to think about saving is as paying yourself first, whether it’s for your future, a vacation, or an emergency. It’s helpful to plan for savings by setting aside a portion of your income on a regular basis. However, you can also do a quick exercise at any time to look at your finances and make a plan to save.

You can also think about saving by setting short-term and long-term goals. Short-term saving can be used for things like going on vacation or building up an emergency fund in case you lose your job, have a medical emergency, or have to pay an unexpected bill. Long-term goals for saving could be to buy a house or plan for retirement.

Putting money away isn’t the only way to save, though. You can also use different types of savings accounts, like an individual retirement account (IRA) or a 401(k), to save on taxes (k). Many employers will even match the money you put into your retirement account, which is a great way to encourage you to save. The Internal Revenue Service (IRS) says, “You may be giving up free money if you don’t put money into your employer’s retirement plan.”

Investing your money so that it grows over time is another way to save. You may have heard people talking about meme stocks like GameStop Corp. (GME) or AMC Entertainment Holdings Inc. (AMC). While the excitement that these stocks create can be tempting, it’s best to start slow and steady with something like an exchange-traded fund (ETF) or a mutual fund. If you want to learn about the stock market right away, try a simulator so that your real money and future financial security aren’t at risk.

4. Pay back any student loans you have.

Paying off your loans should also be a big goal after you graduate. Most student loans give the borrower a six-month grace period after graduation before they have to start paying back their loans.

Make sure you know how much you owe, if you have federal or private student loans, if they are subsidized or not, and what your options are for paying them back. Then figure out how you will pay it back. Tools like the student loan calculator from the U.S. Department of Education can be helpful.

Your payment plan can be changed, just like your budget, and it should be based on your current and future financial priorities and situation. For example, you might have a high-paying job waiting for you when you finish school, or you might be planning to go back to school at some point. These two different situations would probably lead to different decisions about how long and how often to pay back the loans and how to pay them back.

When thinking about your payment plan, you should also find out if you can deduct some of your student loan interest payments on your federal tax return, if it would be better to consolidate or refinance your loans, or if you can put off paying your loans for a while.

5. Know your worth when looking for a job

Before you accept a job offer or look for a job, do some research on the average market salary for your position. This will help you know how much your experience is worth and what a fair (or, even better, a generous) offer looks like.

It’s also important to find out what benefits the companies you’re applying to offer and compare them to the salary they’re offering. This includes things like paid time off, health insurance, and retirement plans. Depending on your situation, it may be worth it to take a slightly lower salary if it comes with better benefits. If you can’t negotiate your salary, you might be able to negotiate other benefits that come with the job. For example, to get people to work for them, some companies help with student loans.

Try making budgets based on different net salaries (this could be as simple as a spreadsheet with a few different columns) to see how a typical month might look and feel for you at a certain income level. Even if a certain salary isn’t possible right now, it can be a goal to work toward and a reminder to ask for a well-deserved raise or negotiate your salary when the time is right.

6. Figure out how your health insurance works

Make sure you know what your health insurance plans cover. If you are under 26 and your parents have private health insurance, you can be covered until you turn 26 as a dependent. If your employer offers insurance, make sure you read it to learn about your health benefits and use them as much as possible. If you don’t, it’s like leaving money on the table.

If you’re young, healthy, and don’t go to the doctor often, you might be better off with a high-deductible health plan, since it won’t take as much out of your paycheck and you won’t be spending much on doctor’s visits. If you go to the doctor often, you should get a health plan with a low deductible. Even though it costs more per paycheck, you will save money over the course of the year.

7. Make little, good habits.

Many good money habits are like flossing your teeth in that they are small tasks that, when done regularly, can have a big impact on your (financial) health. These things include:

Checking how much money you have in your bank account often

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You should know your credit score and check it often.
Paying off your credit card(s) as often and as much as you can is the best thing you can do.
Making regular payments on a loan or debt, as needed
The first two can help you figure out how you spend your money and spot or stop identity theft if you see transactions that don’t make sense. In the short and long term, the last two will help your credit score and your overall financial health.

How can a new college grad save money?

Your first goal should be to set up a fund for emergencies. Also, if possible, use plans like 401(k)s that your employer offers to help you save for retirement. Pay off debts with high interest rates as soon as you can, like credit card debt, and make a plan for paying back your student loans.

How do you put together a budget?

There are many ways to budget, but they all involve figuring out your total income, subtracting your total expenses, and making a plan for any money left over (or figuring out which expenses can be eliminated in order to save more). Use a budgeting calculator, an app, or the 50/30/20 rule to help you make a plan.

How do you pay off student loans?

First, make sure you know how much you owe, whether your loans are federal or private, and how you can pay them back. When making a payment plan, you should think about your current and possible future financial situation. You should also think about whether it would be better to consolidate or even put off payments.

In conclusion

Even though it may seem hard to adjust to life after college, getting your finances in order, paying back your student loans, and knowing what to expect from your first job are all doable tasks if you have as much information as possible. This change will go much more smoothly if you have a plan and learn as much as you can about these new challenges.