How to Stay Out of Debt After Graduation

How to Stay Out of Debt After Graduation

There is a reason why many students claim they are financially broke. University life is tough, and expensive. With food, daily expenses, and housing – the college and university years become overly expensive.

In the United States, an average debt of a graduating college student is more than USD 30,000. In fact, the outstanding student debt has now surpassed the outstanding credit card debt, climbing over the figure of USD 1.4 trillion.

The statistics related to student debt are nothing short of shocking. Around 68% of the college students graduate with debt, which puts them under financial pressure for a long time.

So, how do you make sure you are debt free by graduation, or after graduation?

It is better to avoid student debt, that can be achieved through multiple ways. First, parents need to save for a long time to make sure when the time comes, they have enough money to pay for their chid’s tuition fees.

Second, choose a cheaper school, if you are ready to compromise on quality of education – not recommended though. Third, earn a scholarship.

If none of the above works for you, the chances are, you need to have a student debt for your college and university education, but is it possible to get out and stay out of debt after graduation, or in simple words, as soon as possible.

Coming Out of Debt

The best way to kick-start your career is to begin without any debt, that relieves financial pressure, and allows you to take independent decisions.

If you are among the 30% of students who don’t have student debt by the time of graduation, you are lucky, but if you are not, you first need to plan to get out of the debt.

It may be difficult, but it is possible to get out of student debt while studying in college.

Working while in College

There are many ways to earn handsome amount of money while in college, that works perfectly with your college schedules. For example, there are many remote jobs that you can do from your room. What about working as a virtual assistant, social media manager or joining an essay writing service as a writer?

You don’t have to travel for these jobs, allowing you to invest more time on work, to earn more money, and to pay off your debt.

What About Staying Out of Debt?

If you are the one who doesn’t own a debt, or already paid it, there are many ways that you can keep it this way even after graduation.

The first challenge is, to find a job, but according to statistics, it takes 3 to 9 months for a college graduate to find a job. How to survive these jobless months and stay out of debt?

The best solution is to live with your parents unless you secure a job. Surprisingly, a growing number of young graduates, between the age of 18 to 34 are living with their parents, around 32% in 2014. So you are not alone, a lot more than you expected are doing the same, probably to save money. This is an excellent way to keep your expenses to a minimum.

Once you get a job, learn about money management, and create budget that remains within your paycheck. One of the best money management tip is to invest 10% of your income into something that builds wealth for you, like in funds manager.

When you have a steady income, make sure to use your extra money or savings to create an additional income source. There are many ways you can do this, by starting a side business, an online service, or simply invest in fund manager that offer you steady monthly returns.

Make sure to not to use credit card excessively. Also, make sure you are paying your credit card bills on time. In fact, if you want a better control, why not use a debit card instead of a credit card?

Here are few more useful tips for better money management.

  • Record your expenses. There are some smart online tools available that can not only help you keep track of your expenses, but at the end of the month or year, provides you detailed reports about your expenses like where you spend the most.
  • When buying a home, or a new car, make sure you know what is the debt-to-income ratio. According to most financial expert, the debt-to-income ratio must be 35% or less. Most people need debt when buying a home, so if you want to remain debt free, the options are to live with your parents, or to rent a place.


All in all, managing your debt, getting out of it, and to remain debt-free is an ongoing process. If you are out of debt, it is great, but to make sure you remain this way, you need to manage your expenses and money wisely.