New grads still need money smarts

“Maybe 10 percent of my clients are financially savvy, organized and conscientious,” said Pascaner. “Most people just don’t budget. It’s tough to sit down and try to make estimates, but that’s the best way to get started. Then every week, record your spending in a spread sheet, and do it again monthly.”

Management tools such as Microsoft Money and Quicken can make tracking expenses easier. Using them consistently requires discipline that few folks have, particularly since the payoff isn’t immediate. But budgeting reinforces an important lesson: The choices made today affect the future.

“That’s tough when we’re surrounded by personal desires, peer pressures and media pressures that want to separate us from our money,” said Paul Nourigat, an Oregon-based financial consultant and author of “No Time to Wander: The Financial Compass for Young Americans.”

“Establishing a budget, as boring as it sounds, helps you understand what is coming in and going out. You can make adjustments, so you don’t have a negative cash flow. Budgeting is a fact of life, like having to put gas in the car.”

Nourigat’s book lays out specific plans around money and employment that young adults can adapt to their post-graduation situation, whether they have a job or are moving back home while they look for one. After setting up a budget, his best piece of advice is to get a job - any job.

“Don’t hold out for a job two years from now,” he said. “Start building skills and expertise. It doesn’t matter what it is; good things come from being employed - it helps with self-esteem, it demonstrates what you’re all about. Some of my scruffiest jobs were a testament to my new employer of my desire to be self sufficient.”

Graduates can start their financial journey by having a conversation with their parents, suggests Sheryl Garrett, founder of the Arkansas-based Garrett Planning Network of financial advisors.

“Parents can help students learn the big difference between what’s needed to survive and what you want,” she said. “They can also help by not enabling bad behavior. A lot of parents provide support by alleviating living expenses, but when someone moves back in with mom and dad, they can’t go back to child-like behavior, even about money.”

Garrett’s best advice for parents: Start having financial conversations when the kids are about 4 years old.

“Seriously, that’s not too young to include them,” she said. “We tend to close our children out of that part of our lives, but we shouldn’t exclude the most expensive units of the household from the discussion.”

Five financial tips for college grads

1. Learn to read a pay stub. "It has information about federal withholding, Medicare, FICA and more," said Pascaner. "You should also know that the more withholding allowances you claim, the less tax will be deducted."

2. Start tackling student debt. Don't ignore payment notices. And keep in mind that interest is tax deductible up to $2,500.

3. Establish credit. Obtaining a credit card is the easiest way. Pay off the balance in full every month. In the future, having a solid credit record will be vital to getting that car loan or mortgage.

4. Discuss with parents who is going to claim you as a tax deduction. "This is really applicable during the first year out of school," said Pascaner. "If you are under 24 and were a full-time student, it may be better to let mom and dad to get the benefit of claiming you as a dependent."

5. Think about the end of your career at the beginning. "I cannot minimize the importance of having a retirement plan," said Pascaner. "It may be the furthest thing from your mind, but if you can enroll in an employer's plan, do it. Contribute the maximum possible. The difference can be huge in just 10 years."