Congratulations on graduating! One thing that’s often on the mind of a recent grad is how much that education cost. It wasn’t just hard work and study, education comes at a significant financial cost, leading many into debt. But with a degree, you also have a lot more earning power than you did before graduating. 

Regardless of your circumstances, the methods and strategies for protecting your finances are fairly universal. The differences come down to numbers—how much time, income, debt, and expenses will vary from person to person. To navigate all this, you’ll want to equip yourself with tools like budgets and snowball debt calculators that help you forecast the outcomes of your financial decisions. Here are three fundamental concepts that will help you use those tools: 

1. Learn to budget

The art of budgeting is not meant to necessarily restrict your spending, but rather enable you to be aware of your spending so you can monitor your progress toward your financial goals. A budget is essentially a spending plan, and it can be a living document that evolves and changes with your needs and desires.  

The power you gain from a budget is awareness. You can forecast how soon you can afford something you’re saving up for, you can plan for how soon you want to pay off debt, and you can monitor your progress as often as you like.  

2. Pay off loans aggressively 

The larger payments you make on your loans, the faster they go away, and the less money you spend overall on the debt. A debt snowball calculator can help you see how quickly you can repay your debt by paying off your balances in order from smallest to largest and earning quick wins along the way. 

Once you decide how quickly you want to pay off each debt, put the amount in your budget and stick to that plan as best you can. 

3. Intangible asset allocation 

Once you start to accumulate savings, it’s time to start thinking about how to make the most of them. Your savings are your intangible assets, and there are many different ways you can use them to help you reach long-term goals.  

You might not want to just put all your savings in a savings account where it will earn very little interest. If you have long-term goals, think about how to reach them with long-term investment strategies. Think about retirement accounts that shelter your earnings from taxes, talk to a financial planner about how much of your savings should be in stocks compared to bonds. 

4. Acquire tangible appreciating assets 

Tangible assets are physical things, such as land, a house, a car, or a painting. But it’s important to understand the difference between appreciating and depreciating assets. Depreciating assets lose value over time, for example a car will lose value as it wears down. Money will usually lose value to inflation. But generally speaking, houses and land appreciate value over time, which means they become more valuable over time and you could someday sell your house for more than what you bought it for.  

Owning a house can be smart investment for that reason. On the one hand, owning $10,000 worth of dollars which sits in a bank may lose value over time due to inflation, but if you own $10,000 of equity in a home, the value of the equity may increase with the value of the home.  

While the concept of acquiring assets is good to understand, the process can involve risk as appreciation of assets is not guaranteed. For example, a house could suddenly lose its value over time if it becomes damaged or if the level of crime in the area increases. When considering investing in any sort of assets, always be sure to consult with professionals who can provide insights and guidance that will help you make informed decisions. 

5. Capitalize on Your Earning Potential 

In other words, go after jobs and opportunities that you have access to thanks to your college degree. It can be tempting to think that life works like a video game, and achieving a college degree instantly unlocks new opportunities. That can make it all the more frustrating to apply for jobs with your newly acquired degree and face swift, unexplained rejection.  

But it’s not the degree that employers are interested in, it’s what you did while you were earning your degree. Whether you were studying hard, leading an organization, or learning how to balance schoolwork with other obligations, you have stories to tell, skills you’ve learned and reasons for why you’re qualified for new positions and opportunities. Go after them!  

Use whatever experience you have to support your case for a promotion or a job. Tell people about what impacts you had on your grades, your organizations, and yourself, and relate that to how you can thrive in your next role—all they have to do is say yes and give you the chance you deserve to prove yourself.  

The bottom line 

The best way for new grads to protect their assets is to empower themselves to make informed financial decisions. Instead of wondering how you should pay off your debt, take some pressure off yourself and think about how soon you want to pay it off. What are the pros and cons of each decision you could make?  

Being smart financially is all about making informed decisions that bring you closer to your goals. The more financial freedom you have, the more options and opportunities you can unlock.