By Kelly Miller

Life after graduation for college students can mean many things: a change of pace, a chance to explore and a time to discover. However, with that freedom comes great responsibility. College grads are thrown into the “real world,” where training wheels come off, and bills are sent to them instead of their parents.

Ashley Casey, a senior at the University of Georgia, is ready for the freedom that comes after turning her tassel in December, but still has questions about how to handle her finances post-graduation. “I have a decent idea about how I should budget my money from what I’ve learned from my dad,” she said. “But I still don’t know details about what I should put into savings, investing, retirement­– stuff like that.”

Come January, Casey will be moving to Atlanta, Georgia, to start her first job as a Solutions Sales Specialist at IBM. She plans on living in an apartment with friends and will a pay a pretty penny for cost-of-living in Atlanta. “I just need some tips on where to start with a budget and ways to keep myself accountable for my spending,” she said.

To answer some of Casey’s questions, Kenneth J. White, a financial planning professor at the University of Georgia, offered his 10 best tips for budgeting as a freshly graduated young professional.

Start by tracking your expenses

Before you determine your budget, you should track your expenses for a month or two to have some kind of history to go by. Once you do that and have an idea of your income, then you can start making a budget for yourself. Ideally, you’ll want to have a budget in place before you rent an apartment or buy a home.

Start saving now!

ALWAYS budget for savings, it’s never too early to start. When you are first out of college, you may not have the salary or income that you want to have one day so you think, “I’ll start saving when I make more money.” However, saving is a habit and you need to get into the habit from the start. Saving for retirement is also very important. Save enough to AT LEAST get the full company match on your company’s retirement plan. You want to have a goal of increasing those savings and one day maxing out all of your retirement accounts.

Spend every dime in your budget

If you get to the end of the month and your balance is zero, you’ve accounted for every dollar, and you know where all of your money is going (savings, retirement, mortgage etc.). If you happen to get to the end of the month and you haven’t spent everything in one category of your budget, either put it in savings or have some fun!

Guidelines for budgeting are not rigid

There are some general guidelines you want to keep in mind when creating your budget, like allocating less than 40 percent of your take-home income to housing or putting around 10-13 percent of it in savings. However, the most important thing to do is track your expenses and not necessarily follow the rules of thumb. Once you track your expenses, you’ll be able to eliminate waste from your budget and know where you’ll have to spend.

Your budget is not there to restrict you

Your budget is not meant to restrict you; it’s supposed to drive your financial plan. That’s why it’s important to eliminate waste from your budget so you can have the money to do all the things in your financial plan.

The easiest way to invest is through your employer’s plan

Start contributing to the retirement plan at your job, and you can set up an asset allocation based on whatever risk tolerance you might have or you can go by your time frame. Outside of that, you can set up an IRA that you can invest in.

Use your resources

To help eliminate waste, which can be anything from spending too much money on eating out to or having a high interest rate on a student loan, start using resources around you. For example, I stopped buying books because UGA has a great library and has everything I need. Many times people complain about not having enough, but they aren’t even maximizing the resources they have.

Learn to understand your needs vs. your wants

Before you make a purchase, stop and ask yourself, “Can I get this for free? Can I get this for a discount? Do I really need this?” If you start thinking long-term, then determining needs versus wants gets easier.

How you live today is going to determine how you live tomorrow

There’s this thing in economics called the Relative Income Hypothesis that says two things: One, I’m satisfied with my financial position as long as I can buy the same things that my peers can buy. Two, I’m satisfied with my financial position as long as I can purchase today what I’ve been able to purchase at my highest level in the past.  Neither are relevant to you because they take your focus off your current financial situation. How you prioritize your spending now will dictate how you can spend in the future.

Live life and have fun!

Just enjoy your life and don’t worry about what other people think. Financial pressures can cause a lot of stress, and stress affects your overall health. Creating a budget and sticking to it is one way you can alleviate some of the stress in your life!