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Advice for new college graduates

Posted by Jill Boynton  May 12, 2010 10:15 AM

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Congratulations to all the new college graduates out there.  Becoming independent financially is new and exciting.  Here is some advice – a few things to remember that will serve you well in the long run:


Live below your means.  You won’t go wrong if you always keep your expenses below your income.  Not only will this allow you to save money for emergencies, vacations and retirement, but it also means you will have to adapt less should you have a period of unemployment or reduced income.


Never carry a credit card balance.  Living within your means doesn’t mean you can’t charge expenses.  However charge only what you know you can pay off when the statement arrives.  As a young adult with a limited credit history you are probably going to have a high rate on your credit card so you don’t want the added expense of credit card interest.  If you charge $1000 on a card with a 20% interest rate and pay a minimum amount of $30 per month, it will take you 4 years to pay off that balance and cost you about $470 in interest.


Start saving now for retirement.  Yes, retirement is a long, long way off.  But every dollar you save now will multiply exponentially over the years.  $1 saved today will be worth $21 when you are 62.  If you wait 10 years to start saving, you will have to save twice as much ($2.16) to get that same $21 at age 62.  And if you wait 20 years you’ll have to save more than 4 times as much ($4.66).


Invest for the long-term.  Be patient – chasing high returns and hot stocks will not gain you the most money in the end for many reasons, primarily because this strategy often results in buying stocks at their high point and selling them when they go down.  Invest in no-load mutual funds and spread your investments over different kinds of funds: large-cap, small-cap, international, etc.

This blog is not written or edited by or the Boston Globe.
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Local finance professionals share insights and advice on issues such as budgeting, managing debt, and retirement planning.

About the contributors

D. Abraham Ringer is a CERTIFIED FINANCIAL PLANNER practitioner and a Financial Adviser with Morgan Stanley Global Wealth Management in Boston. He is registered in MA, NH, NY and several other states to which his articles are directed. For more information please visit
Financial Planning Association™ of Massachusetts has 900 members who specialize in the financial planning process. Many of its members engage in philanthropic pro bono work in their communities, recommend legislation, elevate public awareness, promote financial literacy, and advocate for sound economic and tax policies.
Odysseas Papadimitriou is the founder of, a credit card and gift card marketplace, and, a personal finance site. He has more than 13 years of experience in the personal finance industry, and previously served as senior director at Capital One.

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