Helping New Graduates Get a Financial Life

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Yesterday, Veronica Dagher of the Wall Street Journal wrote an article titled “Helping New Grads Get a Financial Life,” which is only accessible to the paper’s subscribers. In the article, she features, among other financial advisors, our own Matthew Illian on the topic of how to make the transition from student life to professional life. Some of the highlights are:

…Tackle Debt, Start Investing.

…get into an employer-sponsored retirement plan right away and contribute at least enough to receive their employer match. As soon as possible, open a tax-advantaged plan such as a Roth IRA as well.

….A lot of recent grads automatically try to adopt a lifestyle–and expense level–comparable to their parents, notes Graham Ewing, a junior planner in Hunt Valley, Md. They buy a new car, eat at restaurants several times a week, plan big vacations–and find themselves deep in credit-card debt.

…Mr. Ewing suggests recent grads start thinking quickly in terms of four money “buckets,” for monthly essentials, emergency savings, retirement and, finally, fun.

Matthew Illian says young adults should read one personal finance book a year to expand their financial literacy. “It’s not likely that their parents or university taught them how to manage their finances well,” says the Charlottesville, Va., financial planner.

If you want to take Matthew up on his challenge to read a personal finance book a year, here’s a short suggested reading list from us at Marotta Wealth Management:

  1. Dave Ramsey’s Complete Guide to Money by Dave Ramsey
    This book holds much practical advice for how to avoid debt as well as how to get out of it.
  2. The Seven Stages of Money Maturity by George Kinder
    George Kinder brings spiritual questions face-to-face with your own financial history to talk about the personal side of your own relationship with money. His three life planning questions are invaluable to thinking through what you really want to get out of life.
  3. Why Smart People Make Big Money Mistakes And How To Correct Them by Gary Belsky and Thomas Gilovich
    Sometimes our brains are not wired for wealth management. This book teaches you how to avoid the most common pitfalls of your personal psychology.
  4. I Could Do Anything If I Only Knew What It Was by Barbara Sher
    “A life without direction is a life without passion.” This is one of the best career management books.
  5. What You Need to Know Before You Invest by Rob Davis
    Ignorance is no excuse for being poor. Everyone, regardless of economic class, can benefit from investing.
Follow Megan Russell:

Chief Operating Officer, CFP®, APMA®

Megan Russell has worked with Marotta Wealth Management most of her life. She loves to find ways to make the complexities of financial planning accessible to everyone. She is the author of over 800 financial articles and is known for her expertise on tax planning.