I graduated college in the first heyday of internet-connected businesses in the late 1990s. Jobs of all types were abundant. And although the “dot-com” bubble burst soon afterwards, unemployment rates remained historically low. This year’s graduates are facing more obstacles than those from fifteen years ago.
Starting on a solid path right out of college is one of the keys to long-term financial success. Good choices today will result in an achievable level of financial independence down the road, even for those graduates who might not be blessed with a solid financial support system at home.
This is going to be a tough world in which to thrive financially for new graduates.
The world today is more competitive. The same skills that were considered noteworthy when I graduated college are commonplace today. In 1998, knowing how to design and code websites was a useful, marketable, and lucrative skill; in 2013, everyone and her grandmother either knows HTML or has access to do-it-yourself websites. And the internet has helped globalize the job market, so even the best website developers need to compete with people from around the world who have the same skills — but whose financial needs from a career are much less.
Outsourcing is still considered an issue worth debating — whether to keep more jobs “here” in the United States, which helps the economy because it gives citizens more money to become consumers of our own products, or to outsource more jobs globally, which helps the economy by reducing the cost of labor for businesses, with the increased profits being reinvested in growth of those businesses.
Globalization is a trend that cannot be reversed. Technology will continue to make it easier for companies to find skilled employees at better rates, in addition to replacing more employees with automated systems.
The one question that should be on one’s mind is, How can I set myself apart from everyone else?
Following these suggestions will help you stand out in a society where everyone is as smart, as talented, and as driven as you. You’ll be noticed by employers, you will be seen as having values that are worth your asking salaries, and you’ll set yourself up for above-average success inside or outside of a career.
Be responsible with your money.
It’s impossible to predict all the challenges over the next fifty years, but more than ever, the world is in a state of flux. Threats to the global economy and to nature are real. Financial independence provides more flexibility to react to changes in the world. I’ve often written about this concept on Consumerism Commentary, but here are a few quick examples:
- Have an emergency fund to help you handle the loss of a job. It gives you the freedom to be selective when looking for a job rather than settling for the first burger-flipping opening you find as you manage your career for the long-term.
- Take charge of your retirement investments to gain financial independence and eventually retire, if that is something you’d like to do. Having the option to stop working is better than needing to rely on trading your time and effort for your salary later in life when you may not want to work. Guaranteed pensions from private companies are all but gone and governments continually reduce their benefits, so you have no choice but to manage your own plans for future income, so do it well.
- Pay off your debt, especially your student loan debt. When you have debt, you can never work for yourself or your family. let’s say you earn $60,000 a year out of school and have a job working eight hours each day. The first two hours of the morning, you’re not working for yourself, you’re working to pay your taxes. If you have to pay $625 a month for your student loan bill, that’s another hour where the benefits of the work you do go to something other than your necessary expenses. Get rid of debt quickly so that every cent you earn after taxes is yours, free and clear.
Start by understanding your expenses and income, documenting where your money goes, and planning how you use money rather than allowing your spending to dictate your financial behavior.
Being good at something isn’t enough.
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