Your child’s first “real” job

Congratulations! Your child passed their interviews with flying colors and received a great job offer. Having celebrated their independence, it’s a great time to offer sound financial advice.

Here are five ways to ensure their success in the real world.

1. Recommend the 50/30/20 rule to your graduate student. Allocate 50 percent of their paycheck to needs, 30 percent to wants, and the remaining 20 percent to savings and investments. Have them recalculate these numbers when they get a raise or a bonus. When saving, I recommend putting 10 percent of your net salary into an emergency account until you have six months of living expenses. Once they reach that level, let them redirect their savings to their investments. Investing early will give them many options later in life, such as: B. starting a business, buying a home, or staying with their children.

I agree with Warren Buffett who once said, “If you want to live a happy life, spend 80 percent of your net pay. If you want to live a miserable life, spend 105 percent.”

2. Set up a direct deposit checking account. After deducting taxes and making contributions to their employer’s 401(k), the remainder of their check should be deposited directly into a checking account with little or no fee.

3. Build good credit. A solid credit history gives your child the upper hand on rental and mortgage loans. Find an easy-to-use credit card and pay off the balance every month. Let them use a budget app like Mint.com or other apps that will send alerts when they exceed their 50/30/20 plan’s spending limits.

4. Basic insurance requirements. Be sure to compare insurance offers. Your child can remain on your health plan until they are 26, but be aware of the cost and coverage differences. Hopefully their new company health plan is robust and will cover them for little or no cost. Compare the price of keeping them on your plan before they sign up at work. If your employer is primarily covering the cost of your health insurance, your child may be better off paying you to stay on your insurance. In addition to health insurance, make sure they have solid car and renters insurance, and sign up for their employer’s group disability insurance, in case they are unemployed for a long period of time due to illness or an accident.

5. Lifelong education. The most successful people I’ve met are lifelong learners. Encourage your kids to spend their free time studying and exercising instead of watching Netflix. The first 10 years of your professional life are crucial for long-term success. The most successful people I know get up early to exercise, plan their day, and read materials that inspire them long before their peers get up. Encourage your new grad to form good habits early on, as it will pay off in unimaginable ways.

Eric Tashlein is a Certified Financial Planner Professional, Founder, Financial Advisor and Coach of Connecticut Capital Management Group, LLC, 2 Schooner Lane, Suites 1-12, in Milford. He can be reached at 203-877-1520 or through www.connecticutcapital.com. Connecticut Capital Management Group, LLC “CCMG” is a registered investment adviser. The information presented is for educational purposes only and is not intended to constitute an offer or solicitation for the sale or purchase of any specific security, investment or investment strategy. Investments involve risk and are not guaranteed unless otherwise stated. It is important that you first seek advice from a qualified financial advisor and/or tax professional before implementing any of the strategies outlined here. Past performance is not an indication of future performance. “CCMG” may discuss and display charts, graphs, formulas and stock picks that are not intended to be used by itself to determine which securities to buy or sell, or when to buy or sell them. Such charts and graphs provide limited information and should not be relied upon on their own in making investment decisions. “CCMG” and Connecticut Benefits Group, LLC are not affiliated.

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