Life After Graduation

Graduation is a momentous occasion and a rite of passage into adulthood. Many college students dream of landing a well-paying job, getting their own place, buying a new car, and maybe even getting married after graduation. However, the recent economic downturn coupled with the rising cost of an education has put these dreams out of reach for so many college graduates. Fettered by $20,000 in student loans, the average college graduate faces a bleak job market in addition to daunting levels of debt. Trying to figure out life after graduation is difficult enough without the added complications of dismal job prospects and a floundering economy. Though current times might not be particularly amenable to the aspirations of recent college grads, a fulfilling and enjoyable life after graduation is still possible, especially with the assistance of student loan consolidation.

The Brutal Job Market

The first task facing college graduates who do not wish to go on to graduate school is finding gainful employment. Student loan grace periods never seem to last long enough, and grads end up racing against the clock to find a job before they expire. Currently, the employment outlook for college graduates with little or no experience is poor, as employers tend to become more selective during times of economic hardship. For educated job applicants like college graduates, this could mean either an extended period of unemployment or biding time in jobs for which they are overqualified. Faced with these grim prospects, college graduates are dropping out of the labor force at alarming rates. In November of 2008, the number of college graduates in the labor force plummeted by 282,000. Without the high-paying jobs college grads dream about, they are now left with the chore of finding a way to work their student loan payments into their post-graduation budgets.

Student Loan Debt Runs Interference

Student loan debt becomes even more of an albatross for college graduates when lucrative employment opportunities are few and far between. Current research indicates that graduates are increasingly delaying major life activities because of student debt. In other words, student loans have become such a burden that more and more college grads are holding off on life milestones. Consider the following statistics:

• 38% of graduates report delaying the purchase of their first home because of student debt
• 14% reported putting off marriage because of student loans
• 21% delayed having children because of education loans

Boomerang Kids

Inundated with challenges during life after graduation, college graduates have begun moving back in with their parents more and more. Indeed, almost 60% of college students report moving home after college. This phenomenon has become so common that a special term has been coined to describe these graduates: “boomerang kids.” Here are some interesting facts about graduates living with their parents:

• About 50% of graduates who moved home reported doing so to save money
• Almost 40% reported moving home because they were unemployed
• 31% of graduates who live at home report feelings of embarrassment for doing so
• 32% of graduates who returned home remained there for more than one year after graduating

How Consolidation Can Help

Grappling with obstacles like a competitive job market and student loan debt can quickly become overwhelming. Thankfully, though, graduates don’t have to go it alone. Student loan consolidation can help smooth the transition into life after graduation by reducing the monthly financial obligations graduates face. Usually, student loan grace periods expire six months after graduation, which means massive monthly payments lurk just around the corner for most grads. Before this harsh reality sets in, graduates can consolidate their student loans in order to make their payments more reasonable and their life after graduation less stressful. Consolidation can reduce the interest rates of both private and federal student loans. For grads who would like to maximize their cash flow after graduation, consolidation allows borrowers to extend the term of their loans and cut interest rates in order to lower monthly payment obligations. With fewer expenses to worry about, college grads can focus on other more important issues, like deciding on a career and finding the right job opportunities in that field.

Life after Graduation: The Major Decisions

Every college grad must make a multitude of important decisions soon after graduation. We’ve listed a few of these decisions below and included some guidance on how to determine what is right for you.

• What career should I chose? Don’t put too much stock in your first job out of college, especially in today’s inhospitable job market. Remember that the average tenure for a first job out of college is 1.6 years, and the average person will switch careers, not just positions, four or five times over his/her lifetime. Accept the best opportunity you can find, start paying off your student loans, and make your career decisions as you go.
• Should I get my own place or move back home? If finances are an issue for you, you should consider how much money you can save by living with your parents for six months to a year. A survey conducted by Experience, Inc. found that 92% of college grads don’t have to pay utilities while living at home, 85% do not have to pay rent, and 74% don’t have to pay for groceries. Those savings added up over the course of a year can mean thousands of dollars more in your pocket.
• Should I stay put or relocate? Moving is expensive, and the cost of living in a new place might be higher than where you currently live. For these reasons, you should only consider relocation if you have been offered a job in another area or if you’re certain that the job opportunities are better somewhere else. Ideally, if you want to relocate, try to find a job elsewhere that will pay for your moving expenses.
• Should I pay off debt or buy a new car? Unless you have no car or your current vehicle is on its last legs, hold off on acquiring any more debt until you make a dent in your student loan and/or credit card debt. Consolidation can lower your student loan payments to affordable levels, but adding a car payment may place too much strain on your budget. Similarly, credit card debt is high-interest debt, so that should be your number-one priority after you consolidate your student loans for lower rates.