To save money, you have to spend less than you earn. Simple enough, right? The truth is that it’s easier said than done. Saving money takes discipline, especially when you’re fresh out of college. No more classes and no more homework, but there are bills to pay and plenty of opportunities to spend your hard-earned money now that you’ve entered “the real world.”

Here are five simple tips for how to stay on top of your savings after you graduate college.

Start with a simple budget

You can certainly keep a running list of expenses and then add it up at the end of the month to see if you spent less than you earned, but making a budget might be more helpful. Consider the 50/30/20 approach to budgeting. Set aside 50% of your budget for your “needs” like rent, utilities, and groceries, 30% for your “wants” like road trips, tickets to concerts, and pizza on Friday nights, and the last 20% for savings. The idea is to figure out how much you have to spend on what you need, so that you know how much you can afford to spend on what you want.

Make your student loan payments

According to the most recent statistics, about 45 million Americans have student loan debt. If you’re one of them, the sooner you start making payments, the better off you’ll be. Most student loans have a six-month grace period after graduation, but you’ll save on interest if you can start paying off that debt sooner. Most importantly, make sure you are making your payments on time. If you have federal student loans and are struggling to make payments, it might be worth considering applying for an income-driven repayment plan.

Work on building your credit

Need another reason to make your student loan payments? Well, aside from the fact that that debt isn’t going anywhere unless you start paying it off, making payments helps build your credit. It’s an opportunity to show lenders that you are a responsible borrower, improving your chances of being approved for a mortgage or a car loan. You should also explore other ways to build your credit, like applying for a credit card. Just remember to spend responsibly!

Keep enough in your savings for emergencies

Not all savings is for retirement. And considering you’re a recent college graduate, it’s safe to say retirement is probably not in your immediate future. Savings at your age is about creating breathing room, because a budget will only get you so far before an unexpected expense wrecks your budget. You can start by aiming to save at least 20% of your paycheck and setting it aside in a high-yield savings account. Consider that your emergency fund. If you can reach the point where you have at least $500 set aside for emergencies, you’ll have a great start.

Understand the basics of investing

The next best thing to saving your money is investing it. Now before you start dreaming about trading on Wall Street, there are simpler ways to invest than buying individual stocks. You can invest your income in a retirement account like a 401(k) or IRA, allowing your money to grow over time due to compound interest. Retirement may be in your distant future, but your future self will almost certainly be thankful you invested as early as you did.

If you are interested in learning more about how you can start saving post-graduation, please get in touch with us. The learning never stops, even after college!