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Real Life Tips for College Graduates

by on May 2, 2012

Congratulations on your upcoming college graduation! Entering the workforce can bring about positive changes—you have more money, no homework, and you can afford to stock your refrigerator with things like cheese from the nice section of the supermarket and beer that comes in bottles. But the real world has its own set of rules, and landlords and banks become less lenient when you’re not a student anymore. You probably won’t be able to walk everywhere like you could in your college town, apartment leases might be harder to get, and your university will no longer provide you with health insurance. NerdWallet is here to give you some facts and tips on the essentials: housing, transportation, healthcare, and finances.


Finding a place to live can be an overwhelming task, and each city has its own unique difficulties. For example, the New York City housing market is dominated by brokers. To find apartments, try Craigslist or city-specific sites like How to Rent in NYC. Make sure you research your neighborhood, and it helps to use your college alumni network, too. Check out your university’s alumni group or email list serve in your city and see if anyone’s posting apartment listings. It can also be useful to talk to the doormen of buildings you’re interested in. Most doormen know which apartments are available in their building and are in close contact with the management company. In addition, if you like a specific building, but there are no available units at the moment, you may want to consider keeping in touch with the landlord; that’s an easy way to get an apartment before it goes on the market.

How much should you spend on rent? Many say a good rule of thumb is to spend at most 1/3 of your post-tax income on rent. But it’s difficult to have a hard and fast rule given the varying costs of living among American cities. Living with roommates usually makes it cheaper as long as you and your prospective roommates have similar ideas of price ranges.

Once you find that perfect place, there’s another challenge: actually acquiring it. Because recent graduates have short credit histories, it may be difficult to convince a landlord of your financial responsibility in a competitive housing market. To compensate, many landlords in major cities require a co-signer for the apartment, and this co-signer needs to make an income that is a certain multiple of your monthly rent. In New York City, this multiple can be as high as 80. Be prepared to ask a parent, older friend, your roommate’s family or your friends to cosign. Most of the time, landlords also require you to pay your first and last month’s rent, or a security deposit all at once when you move in. This can be the equivalent of two-to-three months of rent money. Make sure you have enough saved or know someone you can borrow from to make the initial deposit.


You probably don’t need a car if you’re working in a major city. To save money on commute costs, many young professionals use Wage Works, a commuter program that allows you to buy commuter tickets straight out of your salary before it is taxed. This can result in a monthly savings of up to 40%.

If you are planning on buying a car, it helps to have a good credit score and a co-signer. Buying a car will heavily factor into your credit score, but it’s an excellent way to build credit as long as you can make your full payments on time. It’s definitely okay to consider a used car. Many used car dealerships offer incentives to recent graduates. Every used car should come with a maintenance history and preferably a Carfax report. The Kelley Blue Book is another valuable resource, offering you a comprehensive comparison of new and used vehicles.

If you’re thinking about leasing, keep in mind that this can end up being a much worse value for your money. While the monthly payments are lower, leased cars come with additional restrictions such as mileage limits, steep termination fees, and a ban on moving to a different state before your lease is up.

Health Insurance

There are three main types of health insurance one can get after college: employer-based health insurance, individually purchased health insurance, and health insurance through a parent’s plan. If your employer does not provide health insurance, or if you’re working part-time or freelancing, you may have to purchase your own. The recently passed health care reform laws now allow you to remain on your parents’ insurance plan until the age of 26. If this isn’t an option for you, individual health insurance costs range from $150 to $500 per month. Purchasing health insurance is important in case you have a serious accident or illness. If you’re strapped for cash, at least get a low-cost monthly plan that will protect you if something catastrophic happens.

You can check various rates on or the federal government’s website, Freelancers should check out for negotiated group rate health insurance plans that might be lower. If you’re looking for temporary insurance for a few months until you start working full-time, see if your university offers temporary health insurance. Many schools have started offering this option to recent graduates.


Life for a recent college graduate often involves moving cities every couple of years, so we recommend that you open a checking and savings account at a bank that has branches in most major cities, a credit union that participates in shared branching or an Internet bank like Ally Bank or Capital One 360. These Internet banks charge no checking fees and either partner with ATM networks or reimburse surcharges. Ally and ING both offer savings accounts with much higher interest rates than most brick-and-mortar banks.

It’s important to build good credit so that you can do things like buy a car and lease an apartment. Recent college grads should look for a rewards credit card with a low APR. We recommend the Citi Forward, the Chase Freedom, the Citi Platinum Select and the Capital One Cash, all of which have no annual fee. Many factors will determine which card is right for you. Check out the table below and click on the links to read about each card in more detail.

Card Signing Bonus Best For Rewards
Citi Forward Entertainment rewards 1-5 points per dollar spent
Chase Freedom $100 after you spend $500 in the first 3 months General rewards 5% back for rotating bonus categories, 1% back elsewhere
Citi Platinum Select 0% APR for the first 18 Months Balance transfers None
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  • RentScouter

    The car is a big issue, especially living in a downtown area. Not sure about NYC, but many downtown areas require paying for a parking space when you’re renting. Sometimes upwards of $100-150/per month. You’d almost think twice about having a vehicle or buying a vehicle if you don’t have one! There are a lot of fews associated with downtown/city living, so take all those into consideration when finding a place to rent! And, you typically get better rates for rentals when you sign a longer lease.

  • David Shefchik

    Good advice, but how about things like opening a Roth IRA, paying student loans VS investing, sub-savings accounts (for emergency fund, short-term goals), and financial automation?

    On a side note, everyone should use PadMapper to find their next apartment.

  • Evelyn Phillips

    When renting in NYC yes there are great resources online to utilize, yet if your picky, dont have a lot of time and really looking for specifics, plus the best deals utilizing a broker is always a great choice. They have access to rentals all over the city, know the neighborhoods well and knock out your research load down to almost nothing. Granted the NYC rental market functions differently offering no fee (building pays your broker) and fee (you pay your broker) fees range from one months rent to 15% of the annual rent, yet as the saying goes, “you get what you pay for.” When your short on time the stress they relieve is enormous. There are alot of hoops to jump through and a broker will help find loopholes and strike deals with buildings they have solid relationships with….. Be careful though some can be pushy, best to find one that you really feel is genuine and has all your best interests at heart. – Evelyn Phillips

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  • Credit Cards Online

    Thanks for this useful tips. Now only I completed my graduation. So in my future this guidelines would be helpful to me.