Marketing, Motherhood, and Mayhem

How College Graduates can become millionaires

June 21st, 2010 by Deb McLean

I’ll admit, when I graduated from college I wanted to make lots of money!  And looking back, I made lots of mistakes.  I was offered credit cards which I greedily used to build up a ton of debt.  Thankfully, my boyfriend (then husband) later taught me to not live beyond my means and he got me out of that mess.  Unfortunately, not everyone  is as lucky as I am to marry such a financially savvy guy.

My advise to new college graduates?  ACT POOR!  Act poor like you have for the past four years.  Maybe even live with Mom and Dad for a year or so.  Just PLEASE tell them when you’re coming home at night and do your own laundry (As a mom, I had to say that.)  That’s the time to save a bunch of money.

Your college buddies won’t be doing this. They’re going to want a better car; a new apartment all to themselves and frequent dinners out with friend as soon as they land their first job.  But there’s a great pay off to continuing to live like a college student. If you save like crazy for just a couple of years, you can build an emergency fund that will tide you over when times are really bad.

Make sound, long term investments.  If you get a job where your employer offers a 401(k) plan, it’s not as hard as you might think to save even a stunning $1,000 a month. That’s because your contributions come out before tax, which reduces your out-of-pocket cost because it also cuts your tax withholding, and most employers match your contributions — some even matching.  In other words, you contribute $500 and your employer contributes $500. And because your contribution comes out before tax, your paycheck is reduced by just $400 (assuming you pay 20% of your income in state and federal tax).

Doing little things like packing a lunch is likely to allow you to save about $5 bucks a day, $25 a week and $1,300 a year.  And, of course, if you put off buying that new car and drive your junker, you’re likely to save $150 to $300 each month on car payments, too.

Think about saving now.  Make smart investments in your future and you’ll be a millionaire in no time. 

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