Emily Chiang
Principal at Alexander Randolph Advisory in Reston

Sunday, May 25, 2008; F04

What financial advice should I give my graduating college student?

College graduates returning home to save money should establish a budget to prepare for moving out again. Parents should rent "Failure to Launch," a humorous but instructive movie on what not to do when living with adult kids.

For a city job, graduates should use public transportation. Or, consider a used, gas-efficient car. Pay off credit card balances at the end of each month to avoid annual interest rates of 12 percent or higher. Set aside money monthly until you have accumulated six months of living expenses.

Develop a plan to pay off high-interest-rate debts. Consolidate loans only if doing so reduces your overall interest expense. Live below your means.

Begin saving for retirement as early as possible. If you invest $100 per month beginning at age 26 and earn 9 percent interest per year, you will have $423,705 at age 65. If you begin the same investment program at age 36, you will only have $170,930 at age 65.

Bruce K. Sneed
President of BK Sneed Financial Planning in Woodbridge

Sunday, May 25, 2008; F04

What financial advice should I give my graduating college student?

Start by setting up a filing system to organize financial records. Separate paperwork into four stacks: things to do/read, file, shred, bills to be paid.

Track your expenses daily: Know where your cash is going. Analyze your monthly cash flow, develop a spending plan, and stick with it. Then make a statement of financial net worth and update it at least annually.

Use credit wisely. Raise your credit score by paying every bill on time. If you use a credit card, use it sparingly. Keep outstanding balances at 30 percent or less of your total credit line per account. Avoid opening new accounts. Keep old accounts open, even if you don't use them.

Develop a plan to systematically retire your student debt. Establish and maintain good credit.

Good credit reports favorably influence hiring decisions and reduce borrowing costs. Check your credit reports with all three major bureaus at least annually; make sure the information on them is accurate.

Howard S. Gartenhaus
Wealth manager at Gartenhaus Financial in Rockville

Sunday, May 25, 2008; F04

What financial advice should I give my graduating college student?

Meet with a financial adviser to educate yourself and map out specific strategies for spending, saving and investing.

Establish an "emergency fund" equal to three to six months of your expenses; then start a systematic investment plan.

Enroll in your employer's retirement plan and invest at least enough to take advantage of the employer match. If none is offered, establish a Roth IRA.

Check to see whether consolidating your student loans makes sense.

Pay off your debts by addressing the highest interest rate first. Then stay out of debt by paying your balances monthly. Own no more than two credit cards.

Pay all of your bills on time to preserve your credit score, which is crucial when buying a home or a car.

Don't buy things you can't afford. Save up for them.

The biggest mistake college graduates make is spending too much, too soon.