4 Tough Lessons I Learned About Money During My First Year Out of College​

POPSUGAR Photography | Maria del Rio
POPSUGAR Photography | Maria del Rio

Face it: no matter how eager you are for college graduation, nothing can fully prepare you for entering the "real world." Mistakes will happen. Changes will take place. And for a while, it might seem as if you're the protagonist in a never-ending story of trial and error. But do you want to know the silver lining? Things will be OK. As I've come to realize since my own graduation, this postgrad transition is supposed to ooze with ups and downs. Because the lessons we learn from life's many hiccups make us into stronger, wiser individuals. Or at least that's what I keep telling myself.

While I endured numerous tribulations during my first year out of college, the toughest of times always stemmed from one thing: money. In an effort to prevent you from having to learn the hard way, ahead are four important lessons I learned about money during my first year out of college.

01
Moving away from home comes at a high cost.
Getty | South_agency

Moving away from home comes at a high cost.

A month after graduating college, I packed my bags, waved goodbye, and moved to New York City. Like so many others, living in this city had always been a dream of mine, and I was fortunate to land employment within a couple weeks of my move. However, it wasn't until I started planning trips to go back and visit family and friends at home that I realized how expensive traveling back and forth would be.

Because I was on an entry-level salary and didn't have much extra cash, there were countless times I had to sacrifice attending family events and miss out on monumental milestones in my friends' lives. Eventually, I found it helpful to set up an automatic withdrawal in my banking account so a certain percentage of my paycheck would automatically go into designated savings. This withdrawal made budgeting for holiday travel, etc., much easier and less of financial strain.

02
Understanding your cash flow is essential for financial stability.
Getty | Towfiqu Photography

Understanding your cash flow is essential for financial stability.

Looking back, there was one month I ended up being late on a credit card payment because I didn't have enough money left over after paying rent, all thanks to a sporadic big purchase. Talk about a wake-up call.

This late payment taught me the importance of understanding my spending limits each month, and of course, the essential need for budgeting. If there was a big-ticket item I needed or wanted, I would need to plan for this purchase, while being conscious of my cash flow to avoid sliding down the slippery slope of credit card debt.

03
Sometimes, it's OK to defer your 401K planning.
POPSUGAR Photography | Paul Kabat

Sometimes, it's OK to defer your 401K planning.

There is no denying that retirement planning can be confusing and overwhelming when you first start your career. Roth IRAs, 401Ks, whatever the acronym might be, chances are it probably sounds like a foreign language. It did for me, and I was a business major!

Although it is advised to start planning your retirement as early as possible, I quickly discovered that I didn't have the wiggle room in my salary to start investing, so I had to defer it. At first, I became frazzled with worry that I would "fall behind." However, after much contemplation, I decided to turn that fear into motivation for studying the ins and outs of 401K planning. Instead of investing money I didn't have, I devoted time to learning more about the subject. Thus, when I did start earning a higher salary down the road, I was better prepared — mentally and financially — to make smarter investments.

04
Pay raises aren't always what they're cracked up to be.
Getty | Towfiqu Photography

Pay raises aren't always what they're cracked up to be.

After months of hard work, determination, and one too many late nights at the office, I won't lie — I was fairly confident going into my first review with my boss. Just as I had hoped, she told me I had earned a raise. Yet my excitement quickly fizzled when she informed me of my new salary. The pay raise wasn't much of an increase at all. Subtract taxes and it was barely a bump.

As internally frustrated as I was at the time, this moment taught me one of life's greatest lessons: the power of negotiation!