Whether your goal is to save for life after college, a downpayment on a car, or retirement, the early you start, the better. Thanks to compound interest, starting early will help you reach your goal sooner.
Saving $100,000 after college
In about three years after graduating college, Tori Dunlap built up more than $100,000 in savings at just 25 years old. The feat didn’t come magically, though: Dunlap took control of her expenses, saved, and invested, and she started all of that early on.
“Time is actually more important than money when you're investing...it's more important that you get started now and allow time to work harder for you,” advises Dunlap, the founder of Her First $100K.
After college, Dunlap got a job. To make saving easy, she adopted an automated savings plan that automatically deducted 27 percent of her paycheck and put it into her savings account. She used credit cards for their rewards, but made sure to pay balances on time to avoid carrying debt or risking penalty.
Dunlap then started her own business, through which she advises young people on good money management habits. She has millions of followers on social media.
"I definitely believe that student loans should be forgiven, as the cost of college has increased so dramatically while wages have more or less stayed the same. But as we wait to see what happens with student loan debt forgiveness, I encourage students everywhere to be proactive with their finances,” says Dunlap.
She adds, “I was raised to be serious about saving money. When you have control of your money, you have the freedom to leave a relationship you don’t want to be in, or quit a job you hate, or donate to causes you believe in.”
Easy money-saving tips for college students
You can be like Dunlap or even save more than she has. To do that, the most important step is to just start saving. According to Blue Ocean Global Wealth CEO Marguerita Cheng, don’t focus on the amount you’re saving, focus on the habit. You can start small and increase the amount over time.
Having a side hustle while in college can be a great way to make money and save, but isn't necessary. If you have no income, focus on your expenses. Start by dropping expenses on items you can do without, such as cable subscriptions and gym memberships, and look for ways to reduce necessary costs, such as buying textbooks used, taking advantage of student coupons, and living with others to share rent.