Through College Insights, I work with college students all over the country, helping them find affordable ways to pay for college and make their loans manageable after graduation. I often talk to recent graduates who have not made good financial decisions. Some knew that they had made poor choices, others had no clue. If they had followed our simple advice, they would be in a much better spot. Likewise, if you play your cards right, you can pay off your student loans and other debts faster than you expected, putting you on a good financial path going forward. 
Here are some tried and true tactics to help you pay off loans and make financially sound decisions. They come from my experience in the industry, as well as from other industry professionals. 

1. You Need to Keep Living Like A College Student A Little Longer. 

I can’t tell you how much I see this. People go from being broke college students, then they graduate, get a job, and think they are free to spend, spend, spend. Some want to get married (with a big wedding and a fancy honeymoon), have kids, buy a home, and finally get to stay in a nice hotel on their vacations.

This is problematic for a couple key reasons:
1. Starting a bad habit like overspending at a young age is incredibly problematic. It is harder to unlearn a bad habit than it is to learn a good one in the first place.
2. Overspending only keeps you from realizing your grand, long-term goals. As Dave Ramsey says, “Live like no one else now so you can live like no one else later.” 

Many people think they will attain their parent’s standard of living within five years of graduation, but it took them 25+ years to get there! Be patient. Furthermore, recent graduates often think they are going to make way more money after graduation than they actually will. While average salaries among recent graduates have gone up substantially since the economy recovered, the average salary of a 2016 college graduate was estimated to be $50,556 annually, according to the National Association of Colleges and Employers. So, recent graduates are in a much better position than I was in after graduation, but they still don’t have outstanding earning power directly out of college.

Keep in mind that the average includes high-paying careers like engineering and technology, and that most people will have far lower salaries. If you live in an area with a high cost of living (like I do), pay taxes, and,especially if you have student loans (the average payment is about $400 a month), $50,000 will have you living paycheck to paycheck. You may be able to get a nicer apartment with a degree, but you’ll have to do without the granite countertops for now.

2. Understand the Cost of Kids and Be Honest With Yourself

Going to college, getting a job, getting married, buying a house, having kids. It’s the American Dream, right? As a millennial myself, I understand the pressure all too well. I certainly can’t avoid all the ultrasound pictures and gender reveal videos on my Facebook feed that pop up EVERY DAY. As wonderful as they are, it’s important to remember that kids are expensive. They get sick all the time and require medical care. They need diapers, formula, toys, and care. According to the National Association of Child Care Resource & Referral Agencies, the average cost of child care in the US is $972 per month, and infants are even more expensive. That doesn’t even address the costs of clothing, food, and money lost from taking time off work!

Government data shows the charge for an uncomplicated C-section was about $15,800 in 2008. An uncomplicated vaginal birth cost about $9,600.With insurance, the average cost is around $5,000 just to deliver the baby! Don’t forget the birthing classes, and all the equipment needed like cribs, car seats, and swings. Often, my clients who are struggling hard with their student loans wouldn’t be in such dire straits had they waited a few years longer before becoming parents. Don’t get me wrong, I LOVE kids. I grew up in a family of 30+ cousins, I have been changing diapers and making bottles since I was three, I had 735 elementary children my first year teaching, and I have cared for more children than I can remember. Maybe that’s why I am well aware of the real costs of raising a child. I understand, especially as a woman, that the clock is ticking, but if many of my clients had just waited a few more years to have kids, they would be in very different financial situations.
They could have paid off some of their debt, saved to have a higher down payment on a house, and earned a few more promotions. Friends of mine that got married right out of college and just celebrated their 10th wedding anniversary also just had their first baby a couple of months ago. It is great that they get to enjoy being parents without the financial stresses. There is nothing wrong with waiting to have children until you are in your early 30s and a little more financially stable. Even if your Facebook and Instagram news feeds seems to say otherwise.

3. Master Debt

Every financial advisor I’ve talked to say the number one thing that obstructs people from their true financial goals is debt. You may not be able to avoid all debt, but you have to address it as soon as possible. Jolyn Hohnstein with Primerica Financial Services in Renton, WA says, “People often feel so overwhelmed by their debt that they freeze. They don’t see a light at the end of the tunnel. They pay every month and don’t see their balance go down so they give up and keep charging their credit cards to get by.” She continues, “It is important for clients to learn how to pay off debt correctly so they have some relief. I recommend debt stacking or Dave Ramsey’s Snowball method. I find, using this method, the average middle-class family can be completely out of debt, including their mortgage in 5-10 years.”
Sometimes debt can’t be avoided. People get into medical debt or get divorced and it messes up their finances. However, many people find their way into debt due to their wants. Shawn Fowler of Edward Jones in Auburn, WA says, “We live in an instant gratification society. The old ways of saving for what you need is not well practiced. I will sometimes ask people to tell me of a time where instant gratification was the best choice. Usually, I will get a laugh or sigh as they know what I am talking about. I know that in my life I can think of three times where I was glad that I did it or wished that I would have. Most of the time if I wait long enough or start saving for it, then I will have changed my mind on whether or not to get it.”

4. Understand Wants vs. Needs

This one was huge for me when I graduated from college. I have always been more of a saver and am more frugal by nature, but I also have a really bad case of wanderlust. In fact, the way I got so good at traveling on the cheap (I usually SAVE money when I travel), is because I had to pay down debt. In my head, I simply couldn’t travel unless I could justify it financially.
I am also a BIG Suzie Orman fan and she drills wants vs. needs into her audience. For example, I get client calls all the time that are struggling with their student loan payments, but they just bought a new car (or something else). If your car is unreliable and is posing a safety risk (I do not want you stranded at night of the side of the road), then you do NEED a different car. That does not mean you NEED a brand new car. You NEEDa car with low miles that is dependable that you can get for $10,000, you WANT a brand new SUV with leather seats that costs $45,000. You may want to get married, but you do not NEED to spend $30,000 on a storybook wedding. Can’t you have a nice weddingfor $10,000 and spend the other $20,000 on a down payment on a house? See the difference?

Just because you can make the payments, doesn’t mean you can afford it. I recommend seeing a financial advisor that can help you fully understand your financial situation and what you can really afford. If possible, see a few and get different opinions.

5. Understand the Time Value of Money

Your youth can be your biggest asset when it comes to saving money. Sure, we young people aren’t making much money, and we have huge student loans on top of that. Our parent’s generation thinks we’re entitled. I work with other young people every single day and most of us are not entitled- we are poor. When my uncle graduated from college a million years ago, he made about $50,000 a year (in today’s dollars, he made $120,000 a year). My cousin, who graduated with the same degree as my uncle a couple of years ago, made…$50,000 a year. That’s right, the same amount of dollars, but when adjusted for inflation, less than half of what his dad earned with the exact same degree and in very similar jobs.

What recent graduates are making $120,000 a year right out of college? No one! However, you know what we do have? TIME. Jolyn Hohnstein from Primerica Financial Services explained, “If someone puts $5,500 a year in a ROTH IRA from age 22-29 and stopped at the age of 29, they will have contributed a total of $44,000 into their plan and at age 67, will on average have $2,030,280. If someone doesn’t start saving until they are 30 years old and put the same $5,500 per year into their plan and continue until they are 67 years old, they will have contributed $209,000, but only have $1,871,460 saved. Time is vital when it comes to savings. Pay yourself first and work with what you have left. Don’t pay everyone else first and expect there to be anything left to pay yourself.”

6. Create Your Own Board of Professionals

I love this tip that Shawn Fowler of Edward Jones gave me. As young professionals, we aren’t used to having money to hire people and we don’t know what resources we have available to us. The reason we go to college in the first place is because we all have things we are good at and specialize in. Having a solid board of professionals will not cost you a penny. They will MAKE you money.

You do not need to be a tax expert, hire a CPA. I used to get financial advice from my great-grandparents all the time growing up. Grandparents who lived through the Great Depression have very different money mindsets than our parent’s generation. Add to that list a good financial advisor, lawyer, and people you trust for advice like a pastor, coach, or colleague. By collaborating, you can save yourself time, and time is money.