You may know how to create a post-college budget, but it’s time to talk about exactly what expenses to expect after you graduate.
Now that you’ve had a few weeks to revel in how good graduation feels (congrats!), take a few minutes to learn about those all the expenses—including the hidden ones—that come with real life, and how to budget for them.
1. Student loans
The only good thing about student loans is that they help you afford college tuition. But after you graduate, it’s a whole different story. It seems like as soon as you throw your cap into the air, the banks and loan sharks are sending you requests to pay your loans back right this second. Not only that, but there are also important interest rates to think about. Over time, you’ll likely end up paying more than you borrowed in the first place—and that can be a total bummer. While it all depends on when you start paying loans back and how you decide to pay for them, it’s important to make sure that you set a budget and put aside money for this specific reason. Some loan companies offer grace periods of six months or longer if you need time create a payment plan.
There is also an option to consolidate loans. Consolidating loans allows you to combine multiple loans while reducing your monthly payments. Keep in mind, however, that when you consolidate loans, you may be lengthening the period of time that you will be paying back that money, which in turn increases the amount you will pay in the end due to interest rates.
Assuming you’re not moving in with your parents, the cost of housing is probably going to be your greatest expense (next to loans). Renting an apartment is the most popular option, but it’s important to make sure that you can afford both a deposit and monthly rent upfront. There are also application fees, holding deposits and security deposits to keep in mind—that’ll bring your initial cost up far beyond what the monthly rent is. To make both the first payment and the monthly expenses more affordable, consider finding a roommate to split the difference; living in a one bedroom apartment on your own is going to be more costly than sharing a space with someone else. Whether it’s a close friend or someone who is working in the area, having a roommate (or two or three) is a perfect way to live “on your own,” without completely blowing the budget.
If you landed a job in another state, or you’re being transferred to a far away office, don’t forget about the moving costs that go along with it! If your new company doesn’t offer a relocation package, or if you’re moving to a new city to search for a job, keep in mind that moving after college isn’t anything like going back and forth between campus and your home (where all you need is a plane ticket and a few suitcases). It’s important to save up the money for a move like this!
4. Food and groceries
Say goodbye to kinda-sorta-free, all-you-can-eat dining halls and hello to montly grocery bills. Keeping a full fridge and pantry can be expensive, especially if you have dietary restrictions that leave your options limited, or if you decide to go organic or want to buy fresh fruit and veggies. Whether you eat out with friends or cook mostly on your own, food often seem to slip our minds as a cost we actually have to plan for. Fortunately, there are ways to keep these expenses down. Coupons are always a major help and there are a ton of apps that you can use to stay updated on sales, like Cartwheel by Target, Coupons.com, and Favado.
If you lived on campus while you were in college, chances are you left your car at home to avoid buying an expensive parking permit. Or maybe you didn’t really need it because free campus transportation made it easy to get around. Whatever the case, access to transportation is a major priority now that you’re a graduette. You need to be able to get to and from interviews, part-time jobs, full-time jobs, errands and more. Whether you’re paying to fill up your car with gas or doling out money for pubic transportation, these costs can definitely add up! The GasBuddy app is a great way to find stations to fill up your car on the cheap and don’t underestimate the benefits of carpooling and even biking to work if you’re close enough!
6. Work attire
Now that you’re out of the lecture halls and making your way into the workforce, you’re going to need to make sure that you are able to present yourself professionally—and that comes at a price. You’ll most likely be going on a ton of interviews , so you’ll need staple pieces like blazers, dress pants, and dresses that are appropriate for an interview (and future job) setting. Not only will potential employers be impressed by everything you did at school, but your outfit won’t go unnoticed. You want to show interviewers that you take care of yourself and that you value your appearance—they’ll appreciate the effort that you put into what you wear!
Once you get the job, make sure you’re clear about the dress code and work environment. There is a huge difference between business casual (dress pants, nice shirts) and business professional, which calls for suits and more upscale pieces. Know what pieces to invest in (a really nice blazer and a pair of shoes that’ll go with everything) and which to save on (layering pieces, jewelry)—and make sure everything is easy to mix-and-match, so you can create even more outfits!
While you were at college, your parents probably claimed you as a dependent on their tax forms, but now that you’re out of school, there’s a bigger chance you are of independent status and in a position to file your own taxes. If you need to hire someone to do your taxes, that’s an expense that you’re not really thinking about until it comes to file. Make sure you hold onto receipts, pay stubs, banking information and anything else that may be important once tax season rolls around—between January 1st and April 15th. Traveling by train or public transportation? Any out-of-pocket job hunting expenses can be claimed as a deductible on your taxes, like commuting to and from interviews.
If you’re thinking about filing taxes on your own, TurboTax is a great way to do that. The software costs $54.99, but it all depends on what kind of taxes that you’re filing. They also offer a free federal edition, which includes easy prep, print and file; they’ll even automatically imports your W-2 forms.
You should always prepare for these kinds of expenses, so make sure that you have money saved in an account that you don’t touch. “You should be setting money aside each month that you can use for an emergency, like a car accident,” says Taylor. “I can’t stress enough the importance of saving for the unexpected and not treating all excess money as disposable income.” You never know when your savings account will come in handy and you’ll be relieved that you have some money in the bank, should you really need it.
Going to the movies? Heading to dinner with your friends? Taking a weekend trip? That all adds up. Even small things like a Netflix subscription, getting your favorite magazine every month, or buying a gym membership are extra costs that shouldn’t slip off your radar. If you love to go out to eat (who doesn’t?!), sign up with restaurant mailing lists to get coupons sent to your email and notifications on when they’re having special promotions. If you’re interested in getting in shape and maintaining a healthy lifestyle, but you don’t want to pay a gym membership every month, consider downloading fitness apps. FitStar provides a personal trainer free of charge and allows you to complete challenging workouts from the comfort of your own home. And when you’re planning a trip, remember that on top of an airline ticket or a hotel stay, you’ll need to have money for food, shopping, and any activities that come up along the way.