Personal Finance: Got degree, then job, now, a plan on finances

If you're graduating from college and have a full-time job related to your degree, you're among the fortunate. Few are landing jobs in this tough environment.

Employers are hiring more recent college graduates than last year, but finding work still is not easy and pay remains stunted. Those entering the job market in 2006 and 2007 earned a median salary of $30,000, according to the John J. Heldrich Center for Workplace Development at Rutgers University. The median salary was $27,000 for those entering the workforce in 2009 and 2010, the center said.

No matter what your pay, handling it wisely will make a difference to your future. The key: Make sure you do not let debt build.

Tom Warschauer, finance professor and director of the financial-planning program at San Diego State University, provides this rule of thumb: Do not let total monthly debt payments, aside from a home mortgage, take up more than 20 percent to 25 percent of what is left of your monthly pay after taxes.

Student loans, car loans, credit card payments, and other debts should total no more than 25 percent of your take-home pay.

If you buy a car, you do not want to owe money on it when it is too old to drive or you want a new one. So, Warschauer says, "Don't make the mistake of merely getting a monthly payment you think you can afford."

Affordable payments should be affordable over the right period. If you plan to keep a car for three years, that is when the loan should end.

If you have your eye on a car that does not allow affordable payments, consider a cheaper version so you can buy other things you need and want. Try this calculator: http://www.edmunds.com/tco.html. And this budget calculator will help you see the full picture: http://www.tinyurl.com/425rrmv.

Your monthly rent or mortgage payment should not exceed 28 percent of your monthly pay. If housing is expensive, take on roommates, but be clear about who pays for what. Before signing a lease, draw up an agreement that states monthly financial responsibilities, and have it notarized. Also include what happens to payments if a person leaves before the lease runs out.

College graduates sometimes think they can get along without health insurance. But you never know when you could be in a car accident, and a day in the hospital can cost thousands.

If your job does not provide health insurance and you are younger than 26, you can use your parents' insurance. If parents are covering other children, you might be included in the family plan at no extra charge.

If insurance appears expensive, seek a less pricey plan with a high deductible - the amount of money you must pay before insurance kicks in. Visit EHealthInsurance.com or MyInsuranceExpert.com.

If you have private student loans or credit card debt, pay them off quickly by paying more than the minimum required each month. Get rid of any debts that charge interest higher than the 6 or 6.8 percent you owe on federal student loans. Also, start accumulating an emergency fund so that if you need something like new tires, you do not need to use credit cards.

Try saving at least $25 a paycheck until you have three months of pay saved. And put enough money in a 401(k) at work so you qualify for any free matching money offered by your employer. Never say "no" to free money.

If you are looking for a job in an expensive area, consider a more affordable location. Visit

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