Years of hard work — and one that looked way different than you expected — in the bag. Next up, hopefully sooner rather than later: your first full-time job. (Woohoo.) And your first full-time paycheck. (WOOHOO.)

But also … your first full-time bills (not so much woohoo). And then those first years of paychecks don’t always cover everything you’d like them to (wait, what’s the opposite of woohoo?).

So where do you start … and how can you build good habits with the money you have now, so you can set Future You up right? Here’s our best advice.

Start with the 5 money basics

1. Build a goal-based budget

Step one is to have a plan for where your money is going to go. We have two favorite budgeting approaches — go with the one that feels best for you.

First is the “one-number” approach. It separates the money you set aside for yourself and your fixed costs (aka things that stay the same each month, like rent) out from your flexible costs (things that change, like groceries). That way, all you have to do is keep one number — the amount you can spend on those flexible costs — in mind on a weekly basis. Here’s how it works.

The other budgeting approach we like to recommend is the 50/30/20 rule. That’s where you try to put 50% of your take-home pay to needs, 30% to fun (yay fun), and 20% to Future You (which includes debt payments above the minimums, saving, and investing). Here’s a 50/30/20 rule explainer to help you get started. But hey, real life: 20% might be a lot at first — especially if you move to a big metro area. In fact, that “50% to needs” might end up more like 60%. Or 70%.

The great thing about this budget “rule” is that it’s flexible. If you can’t put 20% of your take-home pay to Future You right now, that’s OK. Start where you are, and then make small steps to increase your income or reduce your expenses. You have to start somewhere!

2. Take advantage of your employer 401(k) contribution match

If your new job offers a 401(k) contribution match, it’s pretty much always going to be in your best interest to take full advantage of it — to max that match out. It’s basically a guaranteed return on your money — and usually more than you’d be able to get even by investing. Here’s more information on 401(k) matches and why they’re such a big deal.

3. Start your emergency fund

Emergencies are a fact of life, and if you don’t have a cushion put away just for the biggies — sudden job changes, medical issues, etc. — they can really knock you out financially. As soon as you can, we recommend starting to set aside money for a rainy day. Try to build up one month’s worth of your take-home pay ASAP so you have a cushion to start with.

Eventually, after you’ve paid off high-interest debt (more on that in a sec), the goal will be to build up a full emergency fund of three to six months’ worth of your take-home pay.

4. Pay off high-interest debt

If you have debt with high interest rates, knocking that out ASAP is a huge move for Future You. That’s because interest payments snowball over time, so if you only make minimum payments on your debt, you’ll end up paying a lot in interest, and it will take a lot longer to pay it all off.

There are two types you’re most likely to have as a new grad. The obvious one is student loans — here’s the important info to know about those, like the different kinds of loans you might have, ways you might lower your rates, and the difference between loan consolidation and loan refinancing.

The other type is credit card debt — and it can really be a killer. As of today, the average credit card interest rate is just over 16%. That’s a lot, and here’s the math on why: Let’s say your credit card balance is $1,000 and the interest rate is 16%. The typical minimum monthly payment is around 2.5% of your balance. If you were to pay only the minimum, it would take you over five years to pay it off, and you’d end up paying nearly $500 in interest alone. Yeah … ouch.

So then, once you have a good idea of what you’re up against, you can start making a plan to pay it off. Here at Ellevest, we usually say that you should focus on paying off debt with interest rates greater than 10% first. Here’s a how-to on prioritizing your debt payments so you can knock them out quickly.

5. Finish your emergency fund

Once you have the most expensive debts off your plate, it’s time to build that mini-emergency fund up into a full-grown emergency fund, with three to six months’ worth of take-home pay. (If you’re not sure exactly how many months you should aim for, here’s some advice on that front.)

6. Invest for retirement and your goals

Once you have your high-interest debt paid off and your emergency fund in place, it’s time to turn your attention (and your “Future You” money) to investing.

First comes retirement. Hopefully, if you have an employer match, you’re already putting a little bit away. But now it’s time to ramp that contribution up and get on track for retirement. Did you know that women typically live six to eight years longer than men but retire with two-thirds as much money? True story. If you’re an Ellevest Plus or Executive member, Ellevest can take info from your real life — like your age and earning power today, plus the fact that you’re a woman (meaning you’re likely to make less money, your salary is likely to peak earlier, and you’re more likely to take career breaks, ugh) — to project how much we think you’ll need to save. Then we’ll come up with a plan to help you get there. Check out our other Magazine articles on retirement topics (and our 7 Days to a Real Retirement Plan email course, if you’re an Ellevest member) if you’re looking to learn more. We’ve got you.

You probably also have other money goals you might want to make happen someday. Goals like starting a business, buying a house, or going on the 30th birthday trip of a lifetime. Investing can help you get there faster than saving. So with Ellevest Executive, we can help you make a plan for those goals, too.

Get ready to negotiate your salary

As you hunt and interview for that first job, the ability to negotiate how much you’ll be paid is key. And it’s something you probably didn’t learn in all those years of college. This can be an intimidating idea — especially if you’re in that place of “pleeeeease somebody just give me a job.” But think about this: Your first salary is the one that all your future raises will be based on.

So if you need a little bit of motivation, do it for Future You: The more take-home pay you’re bringing in, the more likely you’ll be able to put some of it to debt, saving, and investing (yeah, OK, and also a trip to Hokkaido to see the flowers). Here’s some solid advice on how to negotiate your pay.

Oh, and if you’ve already accepted an offer, that’s totally OK. (Actually, that’s really great! Congrats!) Start tracking your work performance from the very beginning so that when annual review time comes, you can show why you deserve a raise.

Get the right kinds of insurance

Health insurance is super important, of course, but it’s not the only kind of insurance coverage you need.

First, there’s renter’s insurance, which is your new BFF if you’re going to live in an apartment. It’s meant to protect your belongings if something happens, like a fire or a broken water pipe or a break-in. It’s not very expensive, and trust us: You don’t ever want to have to pay to replace everything you own.

And then there’s disability insurance, which protects your #1 asset — your earning power. If you go through an accident or develop health concerns that keep you from working, disability insurance can help replace your income. You may not think it will matter much until later, but the more working years you have ahead of you, the more risk you’re facing. In fact, the Social Security Administration says that one in four 25-year-olds will become disabled at some point in their lives. See if you can find an affordable policy through your employer … and if not, check out any alumni associations or other groups you’re a part of to see if they offer discounted rates.

Keep an eye out for lifestyle creep

Speaking of that earning power, here’s something to keep in mind as you set off on your career: “Lifestyle creep” is very real. That’s when your expenses increase at the same rate as your salary does, which means the amount you’re saving and investing stays the same. And that’s one huge reason that the idea that the promise to yourself — “I’ll get started putting money away once I have my finances on track” — always stays set to “someday.”

And hey, don’t get us wrong … we’re all about treating yourself. When you get a raise, a little bit of self-gift-giving is generally extremely appropriate. But keeping your fixed costs down as your income goes up is probably the easiest way to help that Future You part of your budget grow.

The world is your oyster, as they say in every single graduation speech. Now get out there and make your own pearl.

Disclosures