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Starting Out

Whether you're getting your first job or heading off to college, starting to take over your own finances is a big responsibility. But with the right steps, you can be on your way to financial success.

Begin with a budget
If you are starting at your first job, you probably already have a list of ways you want to spend your money. But before you start shelling out your hard-earned cash, it's important to lay down some ground rules for yourself to make the most of your money.

Even if you are headed off to college, ground rules for spending — namely making a monthly budget — will help you stay on the right track. If you will work while going to school, this can help you figure out how far you can stretch those dollars. It will be a challenge to manage both your time and your money wisely, but it can be done.

Picking your first bank
Your first financial step as an adult is to find a bank. Your bank should be more than just a place to pull money out of an ATM. It should be a place where you can develop relationships with financial professionals.

It might not seem important, but getting to know your bank's manager, services and policies can help you use all it has to offer. Establishing a relationship with your bank can give you confidence that your dollars are in the right place, and it can pay off when it comes time to make a big purchase down the road.

For those off to school, check around your campus to see if there is a branch of the bank you use at home or that your parents use. This can make it easier to manage deposits and withdrawals, particularly by avoiding ATM fees. If there is not a branch of your previous bank, it will be a good idea to open your own checking and savings accounts.

If you are working, find a bank that has branches or ATMs close to your job, where you live and other places you frequent. This will let you have access to your money easily without making special trips.

Checking and savings
At minimum, you should open a checking and savings account. If your employer offers direct deposit, this will put your money right into your checking account, saving you a trip to the bank on payday. Sometimes, using direct deposit can also help you avoid account maintenance fees.

Even though your paycheck or parents’ help may be small at this point, getting into the habit of putting money into a savings account now is a great skill to help you down the road. Earning interest on that saved cash adds dollars to what you put aside, in essence paying you for making the right move.

Online banking also can help you track your money and know how much you have in your account at all times. This will help you avoid overdrawing your account by spending more than you've deposited. In addition, online bill payment has become a standard feature with many bank accounts. This can help you save money on checks, easily track your bills and make payments quickly.

Making history. Credit history, that is.
This is a good time to start building a good credit history. Opening a credit card account, using it to purchase items and then paying it off each month can give you a good credit foundation to get a mortgage or car loan in the future.

Use credit cautiously, though, and be sure not to charge more than you can afford. This life stage might include renting your first apartment, and good credit will be an attractive quality to landlords and management companies.

If you are at college, during the first few weeks of school there are usually a dozen or more credit card companies offering you free gifts to sign up for their service. While it can be good to start building a solid credit history, you should be wary of how many cards you open. You should understand the terms of the card, such as the interest rate, credit limit, payment cycles and if there are any annual fees.

If you are taking out loans to pay for college, be sure to talk with the financial aid office or your lender to fully understand the terms of the loan, the repayment plan for after you graduate and how the interest rate works.

Whatever your situation, at this stage in your life, creating good spending habits, paying bills on time, budgeting, saving and planning for your future will help you in the long run.