Thought the class of 2016 had it bad? Well, the class of 2017 will be graduating at a time when redundancies are as high as they’ve been in 7 years.
But don’t worry, if you’re still safely ensconced in the loving embrace of your educational institution, you’ve got time on your side.
The first few years of your career aren’t going to be easy if you’re not a trust fund kid, but there are a few things you can do to give yourself a good measure of financial security even before you enter the big bad working world. Here are five goals to achieve before you graduate.
Start saving money and build up an emergency fund
You might not be earning a full-time salary right now, but that doesn’t mean you can’t still start saving and building up an emergency fund right now.
There are many working adults who live from paycheck to paycheck and would have to resort to carrying a balance on their credit cards if any unexpected expenses hit them. That doesn’t have to be you.
If you’re receiving an allowance from your parents, as many local students do, that means you can afford to get a part-time job and put the money from this job into your savings account.
Don’t think you don’t have any earning power just because you’re a student. There are many tertiary students earning four figure sums every month as tuition teachers, part-time insurance agents and so on. The difference is that they’ve shown initiative by looking for these jobs and showing up in the first place.
Make your first tiny investment
Unlike Aloysius from your finance class, you may not have a rich father who’s given you $100,000 to invest on the stock market.
But that doesn’t mean you can’t make your first, tiny investment. At this age, any investment you make is going to be more of a learning experience than anything else, so don’t worry too much if the vehicle you’ve chosen is low risk and low return.
You might want to put your first $500 in Singapore Savings Bonds or buy your first lot of dividend-yielding blue chip stocks. Heck, you might even choose to put a bit of cash in a fixed deposit.
It doesn’t really matter what you do—the very fact that you’re beginning to learn about and understand investing at this age already puts you ahead of the vast majority of your peers, and makes it more likely that you’ll have a decent investment portfolio up and running in your twenties.
Get your first part-time job (internships don’t count)
No matter how wealthy your parents are, go and get a part-time job at some point during your studies. If David Beckham’s son can work in F&B, so can you.
Other than earning you a bit of spare cash, a part-time job can also get you out of your varsity bubble, help you learn how to interact with different types of people and understand how hard it can sometimes be to show up at work when you’d rather be sleeping.
You’ll also have the chance to learn how to manage your earnings, which you’ll think of a lot differently from the allowance your parents give you every month.
Calculate the liabilities you’ll face when you start working
As a student, your main priorities are to get decent grades at school and enjoy to the fullest your final carefree years as a responsibility-free person.
But once you graduate, your financial responsibilities will start piling up. Calculate all the liabilities you’ll be facing so you know what to be prepared for, and how large of an emergency fund you’ll need if you’re beginning to save up now.
If you are paying your school fees through the CPF Education Scheme or have taken out a bank loan, you want to know how much you will have to repay each month when you start working.
Also get an idea of the household contributions or parental allowance that will be expected of you when you start working. Some parents go so far as to specify how much they expect their kids to give them each month, so speak with yours about it to avoid conflict later on.
There are also some students who, having been coupled up for years, intend to tie the knot and BTO soon after graduation, while their incomes are still low enough to enable them to qualify for more subsidies. This is something you’ll need to factor in when you calculate your financial liabilities before, not after, you start working.
Many young adults go completely nuts with their first few years’ worth of paychecks before getting a reality check. When you already know your liabilities ahead of time, you’re less likely to go through this destructive phase. Not only that, you might actually be able to start saving up for these goals right now.
What financial goals do you hope to achieve before you graduate? Tell us in the comments!