Real Money Tips - Target Alexa Von Tobel

Hats off to you, class of 2013! Graduating from college is no small feat—nor small expense—but your degree is an important investment in your future and absolutely a cause worthy of celebration.

Now that the confetti has settled, it’s time to start thinking about your finances. Don’t be daunted—even if you have student loans and are collecting your first not-quite-a-rockstar-yet paycheck, you can still thrive. 

To help you put your best foot forward, we’ve called on financial guru Alexa von Tobel. She’s the founder and CEO of, a company dedicated to simplifying personal finance, and at 29 years old, she’s also a relatively recent graduate herself. Whether you’re just entering the “real world” or you need to brush up on your budget basics, read on for Alexa’s tips.

First of all, congrats! Graduating from college is a major achievement. Not only is it a big life milestone, it’s also a big financial one. As you enter the “real world,” here are my four tips for becoming more financially secure:

Tip #1: Budget, Budget, Budget

I know—it doesn’t sound like the most exciting money to-do, but it is a critical first step. You have to know where your money is going at all times, and this gives you some parameters for your spending and saving. My favorite budgeting method is the 50/20/30 method: 50 percent of your take-home pay goes toward your essentials (rent, utilities, groceries and transportation), 20 percent goes to the future (paying down debt, saving for emergencies and retirement), and the rest—a whole 30 percent—goes to your lifestyle (eating out, vacations, shopping, etc.). Once you’ve outlined your budget, periodically check in to see how you’re doing. If you’re overspending in one area, you’ll need to adjust accordingly.

Tip #2: Run Your Finances Like You Run Your Social Life

Money plays a role in your day-to-day life, and it’s important to think of it that way. I always recommend treating it like your social life. How? Start by setting calendar alerts for everything from bill payments to tax time. Make sure that important financial to-dos don’t get lost in your inbox by setting up a separate email account just for bank accounts (e.g. Being extra organized from the start will lead to major rewards down the line.

Tip #3: Manage Your Student Loans

Many college grads take on a hefty student loan balance along with their diplomas. Believe it or not, now that you’ve graduated, it may already be time for you to start paying off those loans. Any kind of debt—even “good debt,” which student loans are considered—can be a big burden, so it’s important to have a game plan for tackling these ASAP.

Start by determining how much you’ll owe in minimum payments across the board. Whatever extra money you have should go first toward private loans (private lenders aren’t obligated to work with you in financial duress, so having these paid off will give you more flexibility). Then, order your federal loans from highest to lowest interest rate, and focus on paying the high-interest loans off first. Keep in mind that there are many different repayment schedules out there, so find the one that best fits your current situation.

And finally, remember that there are tax benefits to paying back student loans. You can deduct your student loan interest, which decreases your overall tax liability.

Tip #4: Start Retirement Contributions

Retirement may seem so incredibly far off, but one of the primary factors in reaching your retirement goals is time. The earlier you start, the more time you allow compounding interest to work its magic.

If your employer offers retirement contribution matching, that’s essentially free money so make sure to contribute whatever you have to in order to take full advantage. There are a lot of options beyond 401(k)s, such as Roth IRAs, so do your research before committing to a retirement savings vehicle.

Once you actually crunch the numbers, your retirement goal will most likely be in the millions, so the sooner you start saving, the better!

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