The wealthy know this very well, as they let money work for them instead of working for it. Once you have developed this mentality, building a hefty savings account is not far away.

A common college finance problem explains the impact time can have on savings:

Do you think it’s easier to part with $95 a month or $2,413?

Joan and Michaela are both twenty-two years old. Joan started putting $2,000 a year into an Individual Retirement Account (IRA) for nine years, starting at age twenty-two and ending at age thirty-one.

Michaela waited for nine years and then started putting $2,000 a year into an IRA, at age thirty-one, for thirty-four years until retirement at age sixty-five.

Assuming both IRA’s earned 9 percent, who has more money at the age of sixty-five?

Joan will, with an IRA account balance of $579,504. Michaela’s account balance will be $470,247. This makes sense because Joan’s investment was able to grow and accumulate compound interest over more time (9 years) than Michaela’s. What is even more interesting, and shows the impact that time can have on investments, is that Joan only invested $18,000, while Michaela invested $70,000.

IRA’s are a great investment vehicle while you are young, if you are looking for more information check out our IRA guide for more details.

So we know the value of investing early, but many students or recent graduates do not have the resources to be making these types of investments. So then what? Time should be included in all money management and planning activities. If you are looking for a place to start, make sure that you consider time in your budgeting and goal setting.

Budgeting

The best budgets are always broken down into time frames. These time frames should be decided upon before beginning your budget. Many people use a monthly budget, although you can expand this to quarterly or yearly budgeting as well depending on your payment cycles. You can even create a budget for more than one time period. For example, you could create a high-level income and expense budget for the year, which gives you an estimate for how much discretionary spending you are able to make. After looking at income and expanses froma  very broad perspective, you can drill down to month by month expenses, as sometimes there are one-off expenses for trips, gifts, etc. In addition, some months may have more than the typical 2 paychecks, since there are 26 payment periods in the year, you will want to make sure to account for these in your monthly budgeting.

Savings Goal Setting

Goal setting is pivotal to saving. In order to figure our how much you want to save, you are going to need to set a goal and associate that goal with time. Setting a time frame should help you achieve the goal, not stress you out, so make sure to choose realistic savings goals that do not spread you too thin. Follow the following steps to set up a realistic savings goal:

• Calculate how much you will need to save
  • Specify a dollar value for items you are saving to purchase
  • Specify a saving goal figure (saving accounts, emergency funds, retirement, or nest egg)
• Calculate how much money you must set aside each month in order to reach that goal by the goal time

Employee benefits typically refers to retirement plans, health life insurance, life insurance, disability insurance, vacation, employee stock ownership plans, etc. Benefits are increasingly expensive for businesses to provide to employees, so the range and options of benefits are changing rapidly to include, for example, flexible benefit plans.

Benefits are forms of value, other than payment, that are provided to the employee in return for their contribution to the organization, that is, for doing their job. Some benefits, such as unemployment and worker’s compensation, are federally required. (Worker’s compensation is really a worker’s right, rather than a benefit.)

Companies provide benefits that improve employee morale, increase productivity and job satisfaction. They also have an utilitarian purpose by providing additional economic security to a companies employees.

There are a number of advantages to employee benefits for both employer and employee.

Employer advantages of providing employee benefits

* Helps attract and retain better qualified employees.
* Provides high risk coverage at low costs easing the company’s financial burden.
* Improves efficiency and productivity as employees are assured of security for themselves and their families.
* Premiums are tax deductible as corporation expense, which means savings with quality coverage.

Employee advantages of employee benefits

* Peace of mind leading to better productivity as employees are assured of provision for themselves and families in any mishap.
* Employees with personal life insurance enjoy additional protection
* Confidence in company’s EB schemes boost staff morale and pride in company

Prominent examples of benefits are insurance (medical, life, dental, disability, unemployment and worker’s compensation), vacation pay, holiday pay, and maternity leave, contribution to retirement (pension pay), profit sharing, stock options, and bonuses. (Some people would consider profit sharing, stock options and bonuses as forms of compensation.)

You might think of benefits as being tangible or intangible. The benefits listed previously are tangible benefits. Intangible benefits are less direct, for example, appreciation from a boss, likelihood for promotion, nice office, etc. People sometimes talk of fringe benefits, usually referring to tangible benefits, but sometimes meaning both kinds of benefits.

You might also think of benefits as company-paid and employee-paid. While the company usually pays for most types of benefits (holiday pay, vacation pay, etc.), some benefits, such as medical insurance, are often paid, at least in part, by employees because of the high costs of medical insurance.

Common elements of a benefits package include:

Health Insurance

When you’re young, it’s easy to think you’re invincible and practically immune to disease or injury. But a single trip to the emergency room or being diagnosed with a relatively common condition can quickly turn into an overwhelming bill.

Medical insurance helps cushion the blow. If you’re lucky, your employer will pay your entire insurance premium each month. It’s more likely you’ll pay a small percentage, and your employer will cover the rest. Whatever the arrangement, it’s almost certainly in your best interest to sign up.

Don’t forget to check into additional forms of health insurance as they apply to you:

• • Dental Insurance: This helps you keep your teeth healthy by covering preventive maintenance and repair.
  • Disability Insurance: This will help you pay the bills if you’re somehow temporarily or permanently disabled.
  • Life Insurance: This covers the cost of your funeral if you die and, more importantly, provides for key loved ones you leave behind.

• Health benefit packages can include all or a combination of medical, dental, vision and prescription coverage.

• Employers typically expect employees to pay a small percentage of the insurance premium for health insurance. Check with your human resources department for information about your percentage, or employee contribution.

Retirement Plan

• Many employers offer retirement plans, the most common begin 401k and 403b plans. You contribute to the plan on a pre-tax basis. You won’t pay tax until retirement, when your money is distributed back to you. Employers often “match” employee contributions – for each dollar contributed by the employee, the employer contributes a certain percentage, usually between 2-5%.
• Who wants to think about retirement when you’re just starting out? Whether it’s a 401k or a 403b or some other type of employee-sponsored retirement plan, you should strongly consider this option. You’ll be able to contribute to the plan without first paying the usual federal (and in many cases, state) income tax on your contributions. You won’t pay that tax until retirement, when your money is actually distributed back to you. Better yet, your employer may contribute to your account as well, usually matching a percentage of your contributions.

Vacation and Sick Time

• Paid time off is usually based on an “earned” basis. Each pay period, or each month, you may earn a certain number of vacation or sick hours.
• This benefit is exactly what its name implies: Paid time away from work for vacations, holidays or illness.
• Feeling so crummy you’ve just got to stay in bed today? Your pay won’t be docked as long as you still have allotted time left in your bank.

Flexible Spending Account

• Flexible benefits and Section 125 plans let you put pre-tax money aside (by a direct deduction from your pay) to cover health insurance premiums, child or dependent care, vision expenses or dental care.
• You may know this benefit as a Section 125 plan. Whatever the terminology, a flexible spending account allows you to set aside some pretax money to pay for things like health insurance premiums, child care or even that new pair of glasses you’ve been meaning to buy. This helps you reduce your income tax bill at the end of the year, thus saving you money you otherwise would have to give to the government.

Tuition Assistance/Reimbursement

• Perhaps you see a graduate degree, certification course or industry-specific training program in your future. Many organizations offer partial or even full tuition reimbursement for educational activities they see as benefiting not only you but also the organization as a whole. That’s the equivalent of being handed hundreds or even thousands of dollars.

• It’s impossible to describe every possible employee benefit here. Every company offers different benefits, and individual situations vary. So don’t be afraid to get some guidance from your organization’s HR department, a trusted campus advisor or your parents. After all, most schools don’t teach you this stuff.

Perks

• These are the benefits of a more discretionary nature. Often, perks are given to employees who are doing notably well and/or have seniority. Common perks are company cars, hotel stays, free refreshments, leisure activities on work time (golf, etc.), allowances for lunch, and—when multiple choices exist—first choice of such things as job assignments and vacation scheduling. They may also be given first chance at job promotions when vacancies exist.
• Depending on the employer, you may have access to other benefits such as tuition assistance/reimbursement, daycare facilities, fitness facilities or discounts and more. Check with your Human Resources representative.

More detail about benefits packages:

• Health Insurance
• 401(k) plans
• Tuition Reimbursements

Information Sources:

Steps

1. Ruthlessly limit your selection of tools to only the most vital. The more limited your set of tools is, the more creative the output will be. Having a limited set of vital tools forces creativity and really challenges you to use what you have to produce the desired results. As a byproduct, you’ll get incredibly good with that small set of tools and refine your use of them to a point you can literally do anything you like with them. You’ll be far sharper than someone who merely dabbles with a larger set of tools. Learn how to be resourceful.
2. Don’t listen to feedback, keep following your own path. The problem with asking for feedback is invariably the feedback will be given infused with that person’s preconceived notions of what the outcome should be. Others will unconsciously push you in a direction that they see as best. This is done with good intentions; however, it actually hurts your internal creativity. Now this is different than sharing your work–by all means share, but listening to feedback is not a good decision if you want to truly find your own path of creative self-expression. Once you’re finished with your creative work, whatever it may be, then you can listen to feedback. Just don’t let criticism (even the constructive type) stifle your creativity during the creative process.
   • Keep in mind that people will generally display resistance to your idea, because good ideas change the existing dynamic, and people, for the most part, like things the way they are. When you present something that challenges the status quo, many people (friends, relatives, co-workers) will feel threatened.
3. Having a routine is actually not a bad thing. Routines are positive if they reinforce a healthy, creative consciousness and negative if they destroy that. While breaking your routine once in a while to force new ways of thinking is good, what if growing/learning/experiencing new things was built into your routine as a given? The people who get stuck in a monotonous existence and speak negatively about routine have simply not developed a routine that puts them on a path of internal growth. The key is to discover creative rituals that put you in a more creative mindset.
   • Many writers not only have a minimum number of words they must write each day, but they also have almost superstitious requirements for the circumstances under which they write. The 18th century German writer Friedrich Schiller, for example, kept rotten apples at his desk and soaked his feet in a tub of ice water while he wrote!
   • Don’t be afraid to seize control of your environment and make it work for you. Ray Bradbury wrote the book-burning story Fahrenheit 451 by leaving his house and writing in a library. Stephen King insists on utter silence while writing, while Harlan Ellison listens to high-volume classical music.
   • Set aside a block of time each day to foster your creativity. Kick the session off with a creative exercise or ritual that triggers a flexible state of mind. Whether it’s meditating, freewriting, listening to a particular song, or rubbing your lucky rock–do whatever gets you “in the zone” and set a daily goal (e.g. one sketch per day, 1000 words a day, an invention or song a day).
4. Let go of perfectionism. Your natural output uninhibited by concern for creating something correct or incorrect will always produce creative results. There are limitless paths to achieve creative success; there are so many shades of gray. Imperfection is human, and sometimes the most creative artists leave mistakes unfixed on purpose. Nature itself is beautifully imperfect. Many try to be so perfect that they scrub away what made their work special in the first place. In a world saturated by overproduced, unnaturally perfect, and clean–the unpolished is the most creative and in many cases most inspirational.
   • Work on the “bad” ideas–even if you are only coming up with what you feel are “bad” ideas, you are still being creative, so develop them, and it could turn into a great solution!
5. Ignore trends. If you want to be truly creative, you absolutely must ignore trends. Block them out–pay zero attention to them. Trends are the polar opposite of creativity. In many forms of art (especially music) the masses of artists are following whatever the hot trends set forth are. Then there is the other, smaller group of artists that are pursuing their own path and not really paying attention to external trends in their form of art of choice. There is certainly more money, fame and instant notoriety for following trends, but most of what is popular is hardly creative. If you want to make something truly unique, trends are irrelevant. Looking inside yourself is where you will discover a greater wealth of creativity than available in any hot trend. Here are some more suggestions for insulating yourself from trends:
   • Don’t watch TV, don’t listen to the radio, and remove the vapid elements of popular culture from your life. These things aren’t bad for you in moderation, but they are great at normalizing your thoughts with the rest of society, and do not foster true internal creativity. Realize everything that you experience, every piece of content you consume plays a role in shaping your personality, even if at a subconscious level. It is all influence one way or another. You are in many ways a product of your experiences and stimulus. In one sentence, your creative output can be thought of simply as a personal interpretation of external stimulus. The best part about this is you get to control the input.
   • Don’t try and fit into a genre. Actively trying to fit your art or work into a genre is severely limiting and a detriment to its quality, if creativity is desired. Don’t try and write for a genre, don’t try to follow trends within a genre, in fact don’t even consider genre when working. Labeling it in a genre is a necessary evil for people to be able to find your work, and you will probably have to do this–but it shouldn’t be something that crosses your mind when trying to work. Genres, styles and methods don’t matter for creativity and originality.
   • Spend a lot of time alone. You don’t have to be anti-social, but many people find their creativity really starts to open up when they are removed from others and able to have quiet focus for their creative work.
6. Ignore the past. Want to be really creative or original? Ignore or forget the past; ignore what the world has created up until this point. Sometimes considering the past will make you place a sort of unconscious time stamp on a style. That’s the antithesis of creativity and originality. Create things from within yourself that don’t draw inspiration from what has come previously or even consider it, and you’ll be on a path to creative output. In a creative state of mind, time doesn’t exist–a few hours can feel like seconds, a moment can seem to last for hours, and you’re completely immersed in the present. Learn how to live in the moment.

Creative Exercises

• Think for a half hour a day exclusively on one subject. At first, this might be very hard to do. You can start off by thinking about a single subject for five minutes a day, then increase the period daily until you reach a half hour. At first it is wise to practice this when alone, but eventually you should be able to do it even in the midst of distractions, such as when traveling to and from work.
• Write a letter or speak for 15 minutes without using the words I, me, my and mine. Make it smooth and keep it interesting, so that someone reading or listening would never notice anything odd about it. This forces you to turn your mind outward, and give up the preoccupations and obsessions of your own life.
• Have someone doodle a line for you, then challenge yourself to make a variety of cartoons based on that one line. Don’t resort to drawing faces, though–those are usually too easy!
• Take a familiar outline and challenge yourself to come up with drawings that could fit within that outline.
• Combine ideas. Choose two random objects, and describe each one in detail. What does it look like? What is it used for? How is it made? Then substitute one object with the other objects description. How can I make object A feel like object B? Or do what object B does?
• Keep a journal, describing everything you do and feel with metaphors. Each day, challenge yourself to come up with new metaphors. (After all, how many different ways can you symbolize brushing your teeth?) See How to Write a Metaphor.
• Write a list of basic questions, such as ‘What is your name?’, ‘Where are you from?’, What did you do last Thursday?’ Try to come up with at least 10 questions. The more you ask, the better! Whatever question comes to mind, write it down, even if it seems foolish. Answer the questions with song lyrics. (Try not to use the same song too often.)
• Play word association games. It helps to have someone willing to play along, but if no one will, you can do this alone. If you’re doing it solo, write down your beginning word and spend 10 minutes or so just saying the next word that comes to mind. Compare the beginning word to the final word. They should be pretty diverse. This loosens up your mind to allow free association of ideas.
• See how long you can talk (and make sense!) without using a common word, like ‘and’,'but’, ‘the’ or ‘that’.

Tips

• Spend time around creative people. The most reliably creative people are children. Their imaginations aren’t boxed in, and “mind merging” with them can remind you of what it’s like to think outside the box.
• Whenever you’re challenged to create something, ask yourself: What’s the most outrageous, preposterous, and nonsensical thing I can come up with?

Article provided by wikiHow, a wiki how-to manual. Please edit this article and find author credits at the original wikiHow article on How to Be Creative. All content on wikiHow can be shared under a Creative Commons license.

Here are a few tips on how to plan for life’s big expenses:

1. Prepare a budget to assess your current situation
2. Do your research
   • How much will this purchase ultimately cost you including extraneous expenses such as taxes?
   • If you finance the purchase…
     • How much will it cost you per month?
     • Do you need to put money down?If so, how much?
     • What is the annual interest rate?
     • When will payments begin?
     • When will payments end?
3. Evaluate where this purchase fits into your existing budget.

*Note: You should NEVER tap into emergency funds for big purchases. These funds are set aside in the case of a sudden illness, loss of job or other unexpected reasons.

Once you have evaluated your situation you may need to either save more or spend less. Here are a few tips on how to save money for those big expenses:

1. Set aside money monthly in a savings account towards the purchase.
   • Working with a banker to withdraw money each month from your checking account and deposit it into your savings account automatically can help you save by taking care of the hassle of transferring the money and limiting your accessibility to it through a debit card.
2. Work overtime.
3. Take on a temporary second job.
4. Sell items.
   • This can be done in a garage sale or on several websites across the web, such as eBay.
5. Cut back on non-fixed expenses.
   • Try reevaluating the items you choose at the grocery store, or the number of times you go out with friends to eat, or for drinks.
6. Cut back on frivolous expenses.
   • Cutting back to 1 latte from Starbucks a day instead of the regular 2 can save you around $100 a month.
7. Evaluate other purchase options.
   • Sometimes we have to reevaluate our expectations and purchase a less-expensive option. To help you separate what you need from what you want, take a sheet of paper and divide it into two columns. On the left, write down the features this big purchase must include. Then, on the right, write down the features that you’d like to have. Then compare the results to the options that are in your price range.
8. Wait longer.
   • This may help you come up with a larger down payment, which in turn can lighten your monthly payment.

But how much should you really save? A great baseline for saving is the 70:20:10 rule. This rule is great because it can apply to any saver, at any income level. It is also a great concept because it accounts for not only long-term saving, but the short term as well.

To take advantage of the 70:20:10 rule you should allocate your income as follows:

70% – Expenses/Spending

• Rent
• Heat & Electric bills
• Cable & Internet bills
• Food
• Clothing
• Gasoline
• Medicine

20% – Savings

• 5% Emergency Fund
• 5% Goals
  • Computer
  • Vacation
  • Tuition
  • Car
  • Special Event
  • Designer Apparel
• 10% Long-term (Retirement)
  • IRA
  • 401(k)
  • 403(b)
  • Company Pension

10% – Debt Payments

• Credit Cards
• Student Loans
• Car Payment
• Other Financed Debt

Saving Strategies to Remember:

Although it seems obvious, you should be aware that if you increase or decrease the percentages in any one category, another will be affected. This can be used either positively or negatively for your savings depending on whether you exceed the rule for spending or debt payments.

Once your emergency savings fund equals 9-12 months of your current income, depending on your comfort level and situation, feel free to put money into other investment vehicles such as stocks and bonds.

There are three things to think about when assessing the decisions that center on choosing the right college path:

Be realistic – If you’re career path is low-paying, don’t take out large loans. While education is an investment, you want to be certain that you’ll be able to pay them off.

Think about affordability – An Ivy League education may be trumped by the price tag.

Do your homework – Look for scholarships, grants, and contests that you can apply for, it may make the difference between your dream school and community college.

The majority of employers are looking for and attracted to candidates with relevant experience. So with no previous office experience, how do you increase your appeal? It’s simple – read the job description and apply your experience in the following areas.

‘Relevant Coursework’

Consider your college experience your job. Those class projects you labored over for the past couple years are relevant experience. Previous research papers, on-line simulations, business plans, market analysis, creative writing assignments – the list goes on and on – are all fair game to be included on your resume and discussed in an interview.

The most effective way to communicate this experience is to include a ‘Relevant Coursework’ section on your resume. You can include this either in the body of your resume, or in the ‘Education’ portion of your resume. Just remember – everything included on your resume should be there for a reason, and should have talking points in an interview – everything on that piece of paper is fair game.

Part-time job

Juggling a job and school is impressive to any employer – especially if you maintained your grades. Whether it was filing papers, hosting at a restaurant or working in a retail store, with those jobs came a set of responsibilities, skills and experiences employers can tap into.

Be sure to include these positions on your resume under ‘Work Experience’. Tailor each item on your list of previous job duties to the job description you are pursuing. Look for keywords in the job description you can include in your resume, such as ‘organized’, ‘communicated’ or ‘led’.

These bullet points should almost always begin with an action word (verb). For example, if you were a bank teller you would list:

• Refer customer to bankers based on account indicators to enhance their banking experience
• Conduct routine customer inquiries to answer and solve account problems or discrepancies
• Maintain and balance a large volume cash drawer daily with an impeccably small margin of error

Leadership Roles on Campus

Great! You were a Residence Assistant – now capitalize on that and show the true value and impact you had through your leadership role.

• How often did you participate?
• What rules or regulations did you enforce or enact?
• Did you reduce the number of vandalism from the previous year?
• Did you create any lasting bonds, provide advice, or help a younger student through a tough time?

Clubs and Extra-Curricular Activities

You haven’t had a job because you have been dedicated to playing sports, managing sports, participating in a fraternity, sorority or other organization – are you screwed? Of course not! Your time and involvement has proved not only dedication, but has likely taught you a great deal about leadership, teamwork, relationship building, decision-making, problem solving, time management, communication, or budgeting. All valuable skills to employers.

Volunteering

Many employers value the extracurricular and volunteer activities a student is involved in more-so than the job duties they performed. These activities give employers some insight into your interests, values and passions. Whether it is tutoring a neighbor, friend or relative, playing board games at the local senior center, or serving food to the less fortunate in a soup kitchen, they are ALL important in the mind of potential employers.

]]> http://www.collegiatemoney.com/blog/capitalize-on-your-college-experience-5-areas-of-employer-interest/feed/ 0 http://www.collegiatemoney.com/blog/college-graduate-expectations-money-isnt-everything/ http://www.collegiatemoney.com/blog/college-graduate-expectations-money-isnt-everything/#comments Mon, 06 Oct 2008 16:43:57 +0000 admin http://www.collegiatemoney.com/blog/?p=50 As most young graduates are beginning to learn, it takes more than an undergraduate degree to be making the big bucks. As students graduate, leave school, and embark on a life of their own without the security of their parents or low-interest rate school loans, they are bombarded with the reality of paying off student debt, as well as their own necessities, rent, and utilities. This is coupled with the realization that many will earn, at best $40,000, in their first entry level position.

Although money is very important as a college graduate, choosing a career or job position based upon one factor – Money – is the wrong strategy. There are a multitude of other factors at play not only in employer compensation but in personal development and industry economic conditions as well.

Beyond money, here are some things to consider when looking for that first career opportunity:

Think Long-Term

• Where would you ultimately like to be? Your first job should work to build towards this end goal. Selecting a career path based on an entry level salary is a a short-term decision that can potentially lead to a costly career meltdown or change in the future.

Industry Reports

• Reported industry salary numbers are median figures, half of people in the field earn more and half earn less.
• Often times, the reports predicting growth or wage increases in the field you chose upon entering college are just that – predictions, not facts.

Interests

• Focus on your interests – when you become an expert in the field you truly love and enjoy, the money will follow. People and companies pay for true knowledge, understanding and talent – make your interests work for you!
• Selecting a career based on the statistics, such as job-growth and money can be a recipe for disaster. Ensuing boredom or the loss of interest in your field can make for a miserable career choice and limit your career growth opportunities.

Skills & Abilities

• If you don’t have the skills and abilities to do the job, it can be hard to find or keep a job. That should be pretty obvious!
• Don’t waste your time pursuing a job outside your skills and abilities, instead find the areas you need to work on and find a position where you can work on them

Values

• Are you ready to be consumed by your career right out of the gates? If so, maybe you deserve that $75,000 a year. For most college grads, 70-80 hour weeks are not in the cards.
• Also, many high-paying careers may require for you to concede your sense of integrity, and pride to be successful and appease your co-workers.

Personality

• Being cognizant of your personality traits can help you find a position that in time can make you big money.
• Are you introverted and shy? Maybe you shouldn’t be pursuing a job as a pharmaceutical sales consultant or an account manager where you are intricately involved with clients.
• Your personality also plays into the type of company you choose to work for. Corporate culture can impact the way you feel, think and act both inside and outside of the workplace.