College grads, congratulations.
I'll never forget my very first day of work, two weeks after my college graduation. In a slightly ominous tone, one of my colleagues said, "It's the first day of the rest of your life."
How true. And the first day of the rest of your life commands some Adulting 101. If you already know all this stuff but have young relatives or other youngsters in your network who need to hear it, pass on these five tips so they can secure their financial futures now, rather than later.
Step 1: Start your retirement fund.
It's no coincidence that this found its way to step 1. Do you want to be a millionaire?
If so, take the time to set up your retirement account with your employer right now. Over time, money compounds dramatically.
Let's say you have $1,000 left over from graduation money. You choose to invest it instead of say, buying fancy furniture. You keep your dorm room furniture and invest it at 8% annual return. Let's say you up the ante and add $200 per month to that amount.
You'll have an astounding $643,460.17 after 40 years.
Many employers also offer an employee match. Imagine if your employer contributes more money to that tally over the course of 40 years. You'll have $1 million — and then some. Play around with the IRS' compound interest calculator to see how much your graduation money can net you if you invest it instead of buying furniture you don't need.
How do you start a retirement fund? Go to your new job's human resources office and ask for the forms. Even if you can't tap into your retirement fund for a few months, fill out the paperwork and have it ready to go so you can pull the trigger the second you become eligible.
A major hurdle: Knowing how to invest your money! Opt for a Roth 401(k) and invest 10% of your money. Don't whine about how much it'll chew up your paycheck. Just do it. Your 65-year-old self will thank you.
Step 2: Get renters insurance.
The very first time I lived in an apartment with a friend, our apartment caught on fire. I kid you not. The most damaging aspect? The water damage and the fact that I had no renters insurance because my name wasn't actually on the lease. (I was still in college and crashing on an air mattress on her living room floor — totally living a glam lifestyle.)
The moral of the story: Don't be like me. Get renters insurance. It's cheap, it covers your expenses in the case of extreme situations like this one (and even in not-so-extreme situations).
Renters insurance covers your personal property once damaged or stolen. It covers your medical and legal bills if you are found liable for damaging someone’s property or injuring them. It also covers your temporary living expenses if your rental home becomes uninhabitable.
Renters insurance costs around a low $15 a month, or $179 a year. (You've spent more than that on video games.)
The hardest part: Actually acting on it. In fact, I'll make it easy for you. Get Lemonade renters insurance starting at just $5 per day! (Trust me, the company actually makes it fun.)
Step 3: Learn how to invest.
You want to learn everything you can about investing. Sound like a snooze? It's not when you consider that if you put your money to work for you, it can allow you to do things like:
- Take a break from your career because you've got tons of money saved.
- Allow you to vacation wherever, whenever you want.
- Let you retire early.
Two words can fuel your success: Get curious. Getting genuinely curious about investing leads to intrinsic motivation to save your money and grow it. Watching it pile up also motivates you to save more and more and gets you excited about your potential for the future.
By the way, you might have a question about whether you should tackle student loans or invest. Do both, if you can.
Step 4: Live like you're still in college.
This mindset alone will propel you.
Yep, it might feel painful to live on ramen when your college buddies buy new cars, new clothes, new everything as soon as they graduate. However, you'll win out, in the long run, the longer you can live… well, like a college student. If you spend less than you earn and invest the difference, you'll reap the rewards when you get to retirement age. You'll have millions of dollars and your buddy who originally went out to eat for every meal and splurged on a four-bedroom apartment may struggle to fund his continually growing, expensive lifestyle.
The bottom line: Live like you're still in college for as long as you can. When you get married, have kids, have to save for college, pay for private school tuition, and more, you can't live like you're poor quite as easily.
Plus, when you get used to living on less, you're more likely to make that a lifelong practice.
Step 5: Keep tabs on your health insurance.
What's your insurance situation right now? You can stay on your parents' health insurance plan until you're 26 years old. So, you've got another four years (give or take) after you graduate. However, that four years speeds by quickly. Put the date in your phone when you approach age 26 so you know exactly when you should hop on your employer's insurance or get your own insurance (in the case of self-employment, for example).
Not covered by your parents' insurance? You can get insurance during open or special enrollment periods. Check with your company's human resources office for more information.
The bottom line: Never, ever go without health insurance. Even for one day.
Get Yourself Going in the Right Direction After College
It's hard to hear "you should do this" and "you should do that" when you graduate from college. And the advice might seem so… bewildering. Grandpa Joe might turn to you at your college graduation party and say, "Son, invest," and continue to eat his pork chop.
Investing might not mean much to you because you know as much about the stock market as can fill a thimble. However, remember that college should instill a love of lifelong learning, so add these to your knowledge bank: index funds, stocks, bonds, mutual funds, and more.7 Consumer Discretionary Stocks That May Defy Expectations
Consumer discretionary stocks are those of companies that make products that are popular, but not considered essential. These stocks tend to perform well in a bull market but can lag behind the broader market during periods of volatility. And for the last six months, the volatility that the market has been enduring is adding risk to buying consumer discretionary stocks.
Simply put, consumers will have to be discerning because there are a lot of stocks that will perform poorly. However, like most sectors of the market, it's important for investors to not paint all consumer discretionary stocks with a broad brush. There are several companies that continue to show solid demand remains in place. This is despite high inflation and rising interest rates.
That's the focus of this special presentation. We're highlighting seven consumer discretionary stocks that are worthy of keeping in your portfolio no matter what happens in the broader market.View the "7 Consumer Discretionary Stocks That May Defy Expectations"