Thecreated a troubling world for many people. One group, in particular, will feel the economic ramifications of this global event: .
College grads have a tough road ahead of them once they walk the virtual stage in the coming days. With jobless claims at 36 million, industries such as retail and restaurants being uprooted and more layoffs and hiring freezes on the horizon, graduating right now can be daunting. But luckily, it's not all doom-and-gloom.
Here are seven tips on how to start life after college amid an economic crisis.
Get expert help
Despite your four-year degree, there's still a lot to learn about financial planning and money management -- especially after college. And if you're not sure about how to plan for your future, then ask.
"For many college graduates, it will be the first time they are dealing with complex personal finances involving checking accounts, saving accounts, credit cards, student loans, and car loans," said Chenna Cotla, a behavioral economist in KeyBank's Financial Wellness strategy group. "It is easy to be overwhelmed with the complexity of prioritizing savings and paying down different types of debt. This is where talking to an expert can be very helpful."
Certified financial planners are professionals who give advice on how to achieve certain financial goals, develop a budget and prepare for the future. For instance, they can help you come up with a budget or figure out how to afford a card -- all things top-of-mind for college graduates.
Check with your bank as some have financial planners available for free. You can also look at somethat also provide similar advice as a CFP via an app.
Be aware of scammers
A time when people are most in need of help is also the time when. Keep in mind, if it sounds too good to be true, it probably is. Services claiming to offer debt relief or student loan forgiveness but require fees to be paid in advance are likely scams. If you're searching for a job or side gigs, remember that companies that are legitimately hiring are in need of your skills and will never ask you to pay to work for them.
Search for jobs with student loan benefits
One of the newest perks companies use to entice future employees is to help pay down student loans. Some will offer monthly or yearly contributions to an employee's student loan bill, with subsidies reaching up to $30,000. If you have a large amount of student loan debt and want to plan beyond the temporary grace period (more on that below), consider asking about these types of programs during the hiring process.
Look at student loan relief options
If you have student loans, then you likely qualify for a six-month grace period when no payments are required. Under the CARES Act passed in March, student loan payments are deferred until Sept. 20, 2020. The time is there to help new graduates become acclimated to post-school life amid the current economic climate.
"If you need this time to save money, take advantage of the grace period to do so, making sure you're budgeting effectively," said Kaitlin Walsh-Epstein, vice president of marketing at Laurel Road. "But if you don't need the time, start chipping away at your loans right away as interest does accrue."
If you still need assistance come September (assuming the program won't be extended), get in touch with your loan servicer and ask for relief alternatives, such as an income-driven repayment plan that will adjust the monthly payment based on your salary.
Consider going back to school
Depending on your area of study, going into a post-graduate program could be beneficial, especially considering the current job market.
"If your educational path will eventually require an advanced degree, then right now (while many employers are not hiring or have frozen hiring) may be the perfect time to enroll in that graduate degree program as many universities are struggling to fill their class enrollment as well," said Dana Menard, Founder of Twin Cities Wealth Strategies.
Someone with a master's degree averages $10,000 more in earnings than someone with a bachelor's degree. Plus, staying enrolled in school often means your student loan repayments stay paused, buying you more time to secure a job and securely pay off those loans. Keep in mind, universities are facing limitations due to the pandemic, such as virtual-only courses, hiring freezes and reduced classroom sizes for lab-based curriculum.
Since these conditions seem to change daily, stay up-to-date with the latest procedures at your prospective schools. In some cases, remote learning could further benefit you by eliminating normal costs, like moving to a new city to attend school.
Start saving (if you can)
When you're on your own amid an economic downturn, money saved is an especially important lifeline. It can help when you have a medical emergency or laid off. When it comes to saving money, start by building an emergency fund, which should be enough to cover three to six months of expenses. If you're wondering how much then start off by building up an emergency fund, which should be enough to take care of three to six months of expenses.
Then, if you have additional money to save and grow, consider a robo-advisor that specializes in micro-investing, like Acorns. These artificially-intelligent tools work by taking small amounts from your banking account and investing those funds. Over time, your money will grow, providing you with a financial cushion.
Don't be afraid to ask for help
You may not realize it, but there are a lot of people invested in your success. These are your family, friends and even your professors. If things look grim or you don't know what to do, don't be too proud to ask for help.