Landing that first job means having a regular influx of cash, but steady work alone doesn’t guarantee financial health. Here’s how to build the foundation for lifetime financial security.

Get on budget

It truly doesn’t pay to wing it. Budgeting is the most effective way to get and keep finances on track. Just add up your monthly income and subtract expenses such as student loans, rent, clothing, and entertainment. This gives you a basic financial snapshot. If the numbers look shaky, adjust by cutting unnecessary expenses or adding extra work hours. Using a mobile budget app such as Mint or Level Money can make this process almost effortless.

Establish goals

Financial goals act as a road map toward your dreams. Maybe you’d like your own home or apartment, an exciting vacation or a new car. Highly effective goals are often referred to as “S.M.A.R.T.”: They should be specific, measurable, achievable, rewarding and time-framed.

Build solid credit

Even if you don’t need to borrow right now, having excellent credit history can reward you with the best picks for jobs, apartments and vacation deals as well as with lower insurance premiums and preferred rates when you’re ready for a mortgage or other financing. To begin building credit:

• Apply for a credit card.
• Pay your credit card bill and all other bills on time.
• Use your card regularly, but keep your balances to 30% of your credit limit or less. Also, don’t apply for more credit than you need.
• Monitor credit reports to clear errors, delinquencies or fraud immediately.

Expect the unexpected

With an emergency fund, unexpected challenges such as a job loss or medical issues don’t have to wipe you out financially. Aim to save a minimum of three to six months’ worth of living expenses, and keep that money in a separate savings or money market account that can be accessed quickly during emergencies.

Prepare for retirement

When you first start working, retirement probably is the last thing on your mind. But the hard truth is that the average retirement lasts 20 years, and it will take a massive bundle to support yourself all that time. Social Security won’t cover this alone; you’ll likely need 70% to 90% of your final income annually for a comfortable retirement. It’s never too early to start preparing. Make the maximum employer-matched contribution to any work-sponsored retirement plan, and deposit whatever you can afford into your own private retirement account, which should include traditional and/or Roth IRAs.

Become a saver

Even if you don’t have much extra cash, small amounts saved consistently really grow over time because of compound interest. Commit a set amount to save monthly and make a habit of paying yourself first, before any other bills. Setting up an automatic savings plan that regularly transfers funds from checking to a savings account or deposits a portion of your pay directly to savings can make growing a nest egg a no-brainer.

Personal finance doesn’t have to cramp your style. With a minimum of planning and discipline, your smart choices will help you live well today and achieve your most exciting dreams in years to come.

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