At high schools and universities graduates are hearing commencement speeches filled with messages of hope and support. They're entering a tough world where jobs are few, costs are high, and mom and dad may be low on funds themselves.
The daily news of jobs lost and businesses closed has made them more keenly aware of money - its value, its impact and its consequences - than any generation in recent memory. The Illinois CPA Society suggests sending off this year's graduates with some guidance for starting life on sound financial footing. Here are some thoughts from the Society on the lessons to be learned from our times and shared with the Class of 2009:
- Money is Real. In this wired world we often don't see our friends, or our money, face to face. You can bank and pay bills online and get cash from a machine. Using debit cards, charge cards and electronic transfers can make personal finance seem like a game. Make it real - know what you spend and where you spend it. (For a dose of reality and a little discipline, try the old-fashioned envelope budget method: get the cash you need for a month, put it in envelope and see where it goes and how long it lasts.)
- Save Something. Even if it's just a jar of loose change, find a simple way to put money aside and away from the possibility of being used for expenses. Start early in life with the idea that there should always be some money, no matter how small an amount, you don't use but save for the future. It'll be much easier to start saving now than to break spending habits later. Making an automatic deposit from your paycheck directly to a savings account is an easy way to save before you spend.
- Think twice, spend wisely. Your first apartment doesn't need to be in the trendiest neighborhood; maybe for awhile you can put money aside by staying with your parents. Do you really need new shoes, and if you do, does the designer label really matter? Question yourself before buying anything - from a home to a cell phone. Do you need it and need it now? How much will it cost you in the long run?
- It's not just about having money; it's what you do with it. Big salaries, any salary, might make you feel as if you can do everything and buy anything. Maybe you can, but not right now and not all at once. Consider money management a part of your life as you would your career or your education. Set goals - a new car, a dream vacation - and plan how to achieve them. Work towards where you want to be financially. Keep good records, track your progress, ask questions, understand financial terms, stay informed about news affecting your money, and get help when you need it.