Now that you’ve finally graduated from college, it’s time to start focusing on the bigger picture. Aside from pursuing your dream career, you’re going to need to manage your finances. Creating a budget is one of the best ways to gain a better understanding of your current financial situation. However, there are a few things you need to consider before doing so. Here’s how you can make a post-college graduation budget and build financial security for yourself.

Assess Your Current Debt

The whole idea of budgeting is to help you see what you have to pay every month. One of these expenses will certainly involve the debt you incurred during your time in college. In addition, you also have to factor in other forms of debt, like loan payments and credit card debt. Debt payments can be troublesome and cause budgets to constantly change due to the interest rates attached to them. However, there is a way around this. You can talk to a private lender and see what they can do about refinancing your student loans into a brand new favorable obligation. What’s more is that these lenders offer their clients reduced rates, so you won’t be paying back as much.

List All of Your Expenses

Although debt is one of the categories that belong in your budget it is an expense within itself, and there are others you need to write down as well. The first one being your rent or mortgage. This makes up a majority of how much you pay every month. The next expense should involve your utilities. Your utilities may be a little tricky to figure out as they tend to fluctuate from time-to-time. Your grocery bill can either increase or decrease depending on what you buy. A utility’s price, like electricity, is determined by its usage. With this in mind, you’re most likely not going to get an exact answer of how much you pay each month. Instead, you’ll usually end up with a rough estimation.

Determine What You’ll Put in Savings

After you’ve listed everything you have to pay for, it’s time to start thinking about how much you can put away each month. This can be one of the most difficult factors to figure out, especially if your budget is tight. If you find yourself struggling, you can always follow frugal living tips and adopt the 50/30/20 mindset. The 50/30/20 method is when you take 50 percent of your budget and put it towards the mandatory expenses. Thirty percent can go to anything else you might need or want. And the remaining 20 percent is deposited right into your savings account.

You can use this as an alternate way of creating your budget, so you don’t have to worry about individually separating your finances. Additionally, the 30 percent can also be combined with the 20 percent you put away, which means you can pay off what you need and deposit everything else. It’s a fantastic way to build financial security, especially if student loan payments have been bogging you down.