Recently graduated? Welcome to the real world, it is a fun place. Here are nine helpful tips for you, the newly minted young professional that will help you begin your journey:

1) How to write a check and subsequently balance a checkbook

• Despite the notion that checks are going out of style quicker than Uggs, checks still play a vital role in our society. Expenses like charitable giving, rent, utilities and paying your roommates often require checks. Like I was telling my brother recently, as cool as paying cash is, it comes with no record of it. Your landlord might decide he “didn’t get your rent…” Although they are used less and less, it’s still a good idea to keep at least one book of checks around.
• Balancing your checkbook is simple. When money comes in, you add, and when money goes out, you subtract. This difficult concept seems to have plagued our generation.

2) What a budget is and how to use it

• On a high level, a budget helps you make sure you’re not spending more money than you’re earning. It lets you keep track of your money so at the end of the month you’re not scratching your head wondering where it all went. It can be as simple as a spreadsheet (email me and I’ll send you a template) or online with a site like mint.com. Do yourself a favor and at least use a big picture budget. You don’t have to keep track of every penny (I do…) but just check your budget periodically to make sure you’re safe.

3) How income taxes work

• There are several types of income taxes out there, including federal, state, Medicare and Social Security. You have your gross income (the total amount you made in the year) and then you subtract deductions (charitable giving, student loan interest, etc.) and calculate your taxes off of that amount: your taxable income. For most of us young professionals out there, you can figure you’re walking away with 70% of your total salary. Get used to it.

4) How and why to start saving up for retirement

• Don’t rely on the government via Social Security for your retirement. With rising healthcare and living costs, you’ll either have to work longer into your old age or start saving more, sooner. I don’t know about you, but I’ll take the latter. Figure out if your company offers a 401(k) and contribute to it. If they don’t offer a retirement plan, open an IRA (Individual Retirement Account). You can either save using a Roth account and pay taxes now, or a 401(k) Pre-tax account and pay taxes when you retire. I know it’s hard, but aim to put away 10-15% of your income.

5) What a rewards credit card is and how to use it (also how not to use it)

• A good rewards credit card will give you 1-3% back on all your purchases. Make sure you’re getting the most out of your credit card. Depending on how much you spend, you could be looking at a couple of hundred dollars each year, free. Don’t go overboard with credit cards though; only spend as much as you can afford to pay off at the end of the month.

6) What your credit score is and why it’s important

• Your credit score will help you get a car loan, buy a house, get a job and qualify to be able to rent an apartment. Don’t maintain too high of a credit card balance, pay at least the minimum amount each month on any loans, and NEVER forgot to make a payment. A score of 700+ will keep you in decent shape. Take some time to get your free credit report, pay to get your score (or estimate it for free!) and figure out ways to help it climb higher.

7) How interest works

• Einstein is quoted as saying that compound interest is the most powerful force in the universe. Here’s an example assuming 10% interest, compounded monthly, starting with $100 in the bank.
  • Month 0: $100
  • Month 1: $110
  • Month 2: $121
  • Month 3: $133.1
  • Month 4: $146.41
  • As you can see, the interest builds upon itself, and you slowly have more and more money. On the flip side, your credit card debt and student loans work the same way and will slowly get larger and larger if you don’t pay them off.

8) Why immediately buying a brand new car might be the dumbest move you can make after graduating

• A brand new car will lose a grand or two as soon as you drive it off the lot. It’ll continue to depreciate quickly over the first few years you own it. Higher insurance will come along with it, too. And see #7 for a review as to how a small car loan can quickly become a big pain.

9) Where to continually find great articles about how to manage your finances!

• YoungMoneyFinance is here for you to help ensure you have a smooth transition into the real world. Starting off on the right financial foot can make the difference between being broke in your mid 20’s to living large in your early 30’s.