5 Investment Ideas for Recent College Grads

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Yes investing young is KEY! The day I turned 18 I opened a ROTH IRA putting $25-$50 a month into this account due to my limited college income. When I graduated college I jumped into a 401K with my work that matchs 100% for the first 3% and 50% for the second 3%.
I am currently 1.5 years out of college making $75K. In roughly 2 years I have saved $20K for retirement by putting 9% into my 401K, and $100-$200 monthly into my ROTH IRA. I also am planning for the future putting $25-$50 a month away for future college funds for my kids (dont have any now) but still good to plan.
Now all of this is great to do, but you also need to have some liquid cash in place. I have been putting around $250 a month away (sometimes less/more) but currently have around $10K cash to cover any emergencies. The big issue that I have is sometimes I dip into this savings so if you are like me you should have a secondary savings account available that auto withdraws money for saving. This way every time I log into my banking account I dont see $10K of freebie money staring me in the face.
Many people dont think about saving for retirement, but if you are reading this page I know you are and best of luck to you!

Alex Bagwell of GA 5:43PM February 08, 2012

I agree with Colleen. The article's advice about federal loans is misleading and sometimes outright false. It IS essential for grads to take charge of their loans, but consolidation will not fix everything.
Recent grads should:
1. Check nslds.ed.gov for a list of your loans and your servicers.
2. Contact the servicers immediately and update your contact info and find out your due date. Don't assume you know when grace period is up.
3. As necessary, take advantage of options like deferment or forbearance and various repayment plans. These are already available to you without consolidating.
4. If you have too many loan servicers to work with easily, consider consolidation.
Remember: you don't get a lower interest rate or some magical lower interest plans. The convenience may be worth the effort in the long run.
The best thing you can do for yourself is get educated about your loans and all the options you have.

Amy of NE 9:58PM May 02, 2011

Your statement, "Often, your rate will be lower than the average weighted rate of your existing loans." is puzzling. Federal Consolidation Loans take the weighted average of all the loans being consolidated and round it up to the nearest 1/8th percent. How does that lower the rate?
A Federal Consolidation Loan can provide the convenience of one monthly payment, lock in the interest rate on any remaining variable rate student loans, and lower monthly payments by extending the repayment term. Keep in mind that whenever you make lower payments, you pay more in interest over the life of the loan.
Please stop perpetuating the myth that consolidation is some kind of magic bullet.

Colleen of IL 10:20AM May 02, 2011