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You’ve worked very hard to become an exceptional dentist. Through your intense focus in dental school and a relentless dedication to expertise, you now feel ready to take the next giant step toward building your future­—striking out on your own and buying a dental practice.

There are a lot of big questions you need to ask yourself to ensure you are creating the best possible circumstances for success in your new endeavor. Each decision can bear tremendous influence on your future success, your earning potential, and, probably most important, the impact on your overall job satisfaction and quality of life. Are you ready for the challenge? Let’s dig in to the details to help make sure you know what you want to know.

Buying a Dental Practice

When considering how to buy a dental practice, there could be a number of scenarios that would characterize your circumstances. Have you just graduated or are you about to graduate from dental school? Have you worked as an associate for a time and now feel ready to make the big move? Maybe you’re looking to add to your existing practice by buying a second business. Each situation requires a somewhat different approach.

The first decision is usually whether to start a new practice from scratch or to purchase an existing business from another dentist, possibly one nearing retirement. A brand new office with shiny new equipment, just as you’ve always imagined, might sound very appealing, but there could be disadvantages.

Such an investment could cost you a lot more across the board, including hefty loan payments and business expenses right from the start, few patients, limited cash flow, and slower progress growing the business.

An ongoing practice will likely already have equipment and a business infrastructure, a base of paying customers, and a foundation to build upon. To that end, we’ve compiled some essential questions you can ask before buying an ongoing practice.

Questions to Ask When Buying a Dental Practice

When considering buying a dental practice, you might feel compelled to draw upon your best entrepreneurial instincts. And it can also help if you align yourself with experienced professionals who know the ins and outs of purchasing an ongoing practice. They can guide you through the labyrinth of questions and decisions you’ll be facing. You may want to interview several dental practice transition agents to get an understanding of how their methodologies compare.

On a personal level, you’ll want to define the fundamentals of what your vision for a practice should be. What areas of dentistry do you want to focus on? What locations would be best suited to your customer base?

What overall philosophy embodies the values and standards that you aspire to? It could be helpful to write down these principles as a guide to refer back to throughout this process. You might prepare to pace yourself and to take a thorough and patient approach rather than rushing into decisions.

Once you’ve refined a mission as a guide and determined ideal target areas where you would want to be located, you could develop a personal budget for your living expenses, plus any student loans or other major obligations, to help gauge how much income you’ll need to generate from your new situation. Once you’ve identified a practice that you are interested in buying, you’ll also probably want to work out the costs required to maintain that particular business.

Buying a Dental Practice Checklist

Working with a buying agent can help you prioritize the due diligence necessary to make an informed decision. Here is a checklist of some questions to consider asking when buying a dental practice, and some potential issues you might want to understand in order to make an informed decision.

•  Start with getting some insight into the history of the practice and why the dentist is really selling it. Are they simply retiring or are there other driving factors?

•  Determine how many active patients the selling dentist actually has and what are the demographics (age and ZIP code) for the patients, how many of them are new, and how many of them are insurance patients.

•  Review the practice’s fee schedule and consider how the fees compare to industry standards, the competition, and insurance reimbursements.

•  Obtain a practice valuation prepared by a qualified professional (certified valuation analyst).

•  Ascertain the age and condition of the equipment, the software systems, and premises.

•  Review any and all leases and/or real estate valuations and determine benefits or obstacles for renewals, as well as the possibility to expand the space at some point in the future.

•  Review the performance of the staff and the staffing model and identify what team members will be the strongest practitioners to join your new venture.

•  Conduct a thorough review of the hygiene appointments per month and average monthly revenue, as well as the doctor’s and hygienists’ schedules.

•  Develop a thoughtful and comprehensive plan for transitioning. Keep the patient experience front of mind as you introduce changes. How involved will the selling dentist be in helping ensure a smooth and optimum changeover with staff and patients?

•  Consider what opportunities there will be to improve the efficiency of the practice—staff productivity, billing, processing, etc.

•  Evaluate what ongoing marketing efforts exist and develop a plan and a budget for going forward.

•  Connect with dental supply companies, healthcare-focused accounts, and a small business banking specialist to gain additional insights for your practice.

You may also want to enlist an experienced accountant and attorney to help you sift through the layers of financial information related to the business you are hoping to purchase.

Among other things, the accountant will likely want to review several years of business tax returns, the cash flow model, and aged accounts receivables for gauging the competence of the collection policies, collection reports, and procedures. The lawyer can help with evaluating associate agreements, equipment and building lease agreements, or real estate appraisals and the potential for purchase.

It could also be a good idea to take note if a selling dentist pushes you to use a particular professional resource—that could be a potential red flag.

While this is a fairly extensive tips list, things are likely to come into focus once you’ve found a selling dentist with whom you connect.

Your membership in professional organizations such as the American Dental Association or the Academy of General Dentistry can provide extensive additional information regarding specifics related to buying a dental practice.

Getting Your Finances in Order

Finally, you’ll likely want to make sure that you have a reasonable handle on your finances going forward. That may include reviewing your dental school loans and making sure that they are as manageable as possible as you enter this new chapter of your career. Refinancing student loans through SoFi could lower your interest rate or potentially save you thousands of dollars.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

SoFi Student Loan Refinance
SoFi Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891. (www.nmlsconsumeraccess.org). SoFi Student Loan Refinance Loans are private loans and do not have the same repayment options that the federal loan program offers, or may become available, such as Public Service Loan Forgiveness, Income-Based Repayment, Income-Contingent Repayment, PAYE or SAVE. Additional terms and conditions apply. Lowest rates reserved for the most creditworthy borrowers. For additional product-specific legal and licensing information, see SoFi.com/legal.

Joining the Peace Corps after college or grad school is a noble way to start your career. Volunteers in the government program deploy to more than 60 countries around the world for two-year stints of public service.

That can mean anything from teaching secondary school, to working with farmers, to promoting health awareness. If you’re considering following this path, you’d be joining more than 230,000 American adults who have served since the program was founded almost sixty years ago.

But if you’re like most students these days, you might be graduating with a significant amount of educational debt. Today, 70% of undergraduates finish school with debt, with the average borrower owing more than $37,000, and that’s before interest adds up over the years.

Committing to the Peace Corps, which pays only a local living allowance while you’re enrolled, can be daunting when you’re facing that burden. You may be wondering whether the Peace Corps will even allow you to join with a heavy debt load.

The answer is yes—he Peace Corps and student loans can go together. You’re still responsible for your loans if you become a volunteer, but you could be eligible for additional benefits as a result of your service that can make paying them off easier. If you’re seriously thinking about the Peace Corps, here’s what you need to know about managing your debt during and after your time abroad.

Options for Reducing Loan Payments During Your Service

If you join the Peace Corps right after school, you may not have to start repaying your loans immediately. That’s because anyone who has certain federal loans (Direct Loans and Stafford Loans) gets a six-month grace period before payments are due, although interest will might start accruing.

You don’t qualify for a grace period if you have a PLUS Loan, and with Federal Perkins Loan, you’ll have to check with the school that issued it. If you were enlisted in active duty military service, the grace period can be extended for up to three years. However, that doesn’t apply to the Peace Corps.

Still, like the military, the Peace Corps is considered a form of government service. As a result, if you have federal loans, you may be eligible for certain options to pause or reduce your payments while you’re a volunteer.

First, as a Peace Corps member you may qualify for deferment . This allows you to stop making payments, or reduce the amount you pay, during the time you’re in the field, for up to three years.

During deferment, you are not responsible for paying interest that builds up if you have certain kinds of loans, including Direct Subsidized Loans, Subsidized Federal Stafford Loans, or Perkins Loans. You are responsible for interest, however, if you have unsubsidized federal loans or Direct PLUS loans.

Note that your deferment will not automatically kick in when you join the Peace Corps—you’ll need to submit an application and documentation to your loan servicer.

Your loan servicer may also have you re-apply for deferment after a year, so make sure you turn in the necessary paperwork. If you’re still in the six-month grace period for any of your loans, ask your lender about the right time to apply for deferment.

Another way to reduce your monthly payment on federal loans is to apply for an income-based repayment plan . The government offers four repayment plans designed to make payments affordable if you’re on a limited income. These plans tie how much you pay every month to how much you make, limiting your outlays to between 10% and 20% of your discretionary income.

The specific plan you qualify for depends on the types of loans you have and when you borrowed. If you stick with the plan when you get back, your balance may be forgiven if you continue making minimum payments for 20 or 25 years, depending on the plan.

If you have private loans, there’s no guarantee that you’ll be able to pause or reduce those payments. But some private lenders do offer flexibility during periods of economic hardship, so approach yours to ask whether they can offer you any options while you’re a volunteer.

How You Can Get Your Loan Partially Cancelled

If you have a federal Perkins Loan, you may qualify for another perk thanks to your Peace Corps service: partial cancellation .

You can get 15% of your loan canceled after your first year of service and another 15% after your second year, then 20% after your third and fourth years, respectively. That adds up to having 70% of your loan canceled after four years!

This also includes the interest that accumulated during that time. All borrowers who have Perkins Loans are eligible, regardless of when you took the loan out, but only service completed after Oct. 7, 1998, qualifies. This benefit can make it easier to sign up for the Peace Corps with student loans, but keep in mind that other types of loans aren’t eligible.

The Peace Corps and Public Service Loan Forgiveness

Since the Peace Corps is clearly a way of doing good in the world, it shouldn’t be too surprising that as a volunteer you may be eligible for Public Service Loan Forgiveness.

Under the program, if you make payments for 10 years on your loans under a qualifying income-based repayment plan, you may be able to have the balance on your loans forgiven.

Because you have to make 120 monthly payments to qualify, you would only be eligible if you continue in a public service job full-time at some point after leaving the Peace Corps. Other qualifying fields include government organizations, 501(c)(3) nonprofits, public service agencies such as libraries and police departments, and more.

The payments don’t have to be consecutive, meaning you may qualify if you go back to public service after a few years doing something else. Note that this program applies only to Federal Direct Loans, but not Perkins Loans or loans under the Federal Family Education Loan (FFEL) Program. If you’re hoping to qualify for this, complete an Employment Certification form every year, starting with your time in the Peace Corps, or when you switch jobs.

When you look into options for student loan forgiveness, beware of the scams out there, some of which target young graduates like you. One prominent example is the Obama Student Loan Forgiveness Plan, which doesn’t exist but sometimes lures borrowers to pay fees for paperwork they could’ve completed themselves or for nothing at all. Stick with the forgiveness options offered directly through the Department of Education .

How Student Loan Refinancing Can Help

If you’re looking for other ways to make payments more affordable while you’re in the Peace Corps, or after you leave, consider refinancing your student loans. You can refinance federal loans, private loans, or both.

When you do so, you take out a new loan from a private lender to pay off your existing loans, which might make sense if you qualify for a better interest rate or lower monthly payments than you previously had. A loan refinancer will take a look at your personal information, income, credit history, and other factors when deciding what terms and interest rates to offer you.

Fixed rates will stay the same for the term of your loan, while variable rates will shift over time. Keep in mind that refinancing federal loans will mean you have to give up government benefits like deferment, partial cancellation, income-based repayment, and Public Service Loan Forgiveness. But for some people, refinancing can be a great way to make student debt manageable while you’re a volunteer and for the ensuing years.

Don’t Let Student Loans Stop You from Following Your Dreams

If your goal after college or grad school is to join the Peace Corps, or engage in any public service for that matter, your student debt doesn’t have to be an obstacle . With federal loans, there are options for delaying or reducing payments or getting part of your debt canceled or forgiven.

And regardless of what kinds of loans you have, refinancing can be a way to make payments more affordable. Plus, when your two years of service are complete, you’ll get $8,000 from the Peace Corps that you can put toward your loans if you want to. Coming up with a plan to pay your loans is important, but that doesn’t have to come at the expense of making a difference.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

SoFi Student Loan Refinance
SoFi Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891. (www.nmlsconsumeraccess.org). SoFi Student Loan Refinance Loans are private loans and do not have the same repayment options that the federal loan program offers, or may become available, such as Public Service Loan Forgiveness, Income-Based Repayment, Income-Contingent Repayment, PAYE or SAVE. Additional terms and conditions apply. Lowest rates reserved for the most creditworthy borrowers. For additional product-specific legal and licensing information, see SoFi.com/legal.

Getting married is a momentous occasion—you’re choosing to legally commit to your partner in sickness and in health. And that’s something to celebrate. But before you say “I do,” it is important to understand how your student loan obligations might change after your big day.

After all, you’re ready to share your life, but do you have to share your student loans? Here are five things to know about student loans and marriage.

Open and Honest Communication is Key

Let’s be real for a second: money is stressful. In fact, money is one of the most common topics of relationship stress. Whether you’re arguing about high student loan payments or how much you want to spend on eating out every month, money can cause relationship problems.

There is good news, though: couples who talk openly about money daily or weekly are more likely to have strong marriages. That means that learning how to talk about money before you get married is one great way to create a strong relationship from the get-go, especially if you’re marrying someone with student loan debt, or have student loan debt yourself.

In addition to figuring out your money and budgeting style, it can be helpful to hash out the basics before your marital bliss is interrupted by your next student loan bill. For starters, it may be helpful to discuss exactly how much each of you owe on your student loans. It is important that you both understand exactly how much is owed so you can plan for repayment together.

Once you’ve got the hard numbers down, it may also be helpful to share what type of current student loan repayment plan you are on, and what your repayment priorities are. After all, if your partner wants to pay off their law school debt right away but you’re happy on an income-driven repayment plan as a school teacher, it is important that you have a plan for navigating potential disagreements.

While every relationship is different, all relationships will require decision-making about money. Learning to talk about money now can help set you up for success down the road.

Who is Responsible For Repayment?

You’re not automatically on the hook for your spouse’s loans. If you or your spouse took our student loans prior to your marriage, you likely won’t be responsible for those loans if your spouse stops paying.

Of course, if you or your spouse takes on new loans while you’re married and you live in a community property state, you may end up responsible for a portion of that debt.

The law is complicated, so if you’re worried about dividing up your assets before you get married, it is always good to talk to a lawyer. Many young couples are even now considering pre-nups to protect themselves and set up expectations in advance.

Will My Monthly Payments Change?

So then when it comes to student loans, marriage doesn’t change anything? Not so fast. One often-overlooked aspect of marriage is that it can change your income—and this matters for many reasons, including determining your monthly income-driven loan payments.

For example, if you’re on a repayment plan that uses your household income to determine your monthly payment, and are married and filing jointly, your lender will take into account both you and your spouse’s income, which could lead to higher monthly payments.

Likewise, you may miss out on the student loan interest deduction when it comes time to file your taxes. P.S., talking to an accountant or tax attorney when when it comes to all things taxes and student loans could be a smart idea. When in doubt, definitely speak with a licensed professional.

Thinking About Refinancing Your Loans with Your Spouse

Just because your student debt doesn’t automatically become a joint obligation the moment you say “I do” doesn’t mean you can’t combine your debt and focus on paying it off together.

Many couples choose to combine their student loan debt through refinancing so they can pay off one bill together, rather than juggling multiple debt payments.

Student loan debt and marriage can be stressful, and student loan refinancing allows you to combine multiple loans into one (potentially with a lower interest rate).

Of course, refinancing isn’t for everyone. If you or your spouse is planning on taking advantage of income-driven repayment or other federal repayment programs, joint refinancing with a private company could make you ineligible.

It’s important to start your marriage off on a strong foot by making sure that you and your partner can talk honestly about money. Together, you can navigate anything—including student loan debt.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

SoFi Student Loan Refinance
SoFi Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891. (www.nmlsconsumeraccess.org). SoFi Student Loan Refinance Loans are private loans and do not have the same repayment options that the federal loan program offers, or may become available, such as Public Service Loan Forgiveness, Income-Based Repayment, Income-Contingent Repayment, PAYE or SAVE. Additional terms and conditions apply. Lowest rates reserved for the most creditworthy borrowers. For additional product-specific legal and licensing information, see SoFi.com/legal.

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That master’s degree in art history may help you understand cubism, but is it going to help you buy a Picasso one day? While material gain is not the only driving factor in most people’s decision to pursue higher education, it is worth considering, especially as more Americans become conscious of graduating with large outstanding student loan debt.

Lifetime Earnings by Education

When you’re considering graduate school, you have a lot to think about, including which programs best fit your interests, where the school is located, how much it costs, and how you’ll pay for it. The price of some grad programs can be dizzying: One year at Harvard Business School may set you back over $109,000.

A potentially hefty price tag means you have to consider whether a degree is worth the cost, especially if you have to take out student loans to help you get there. One way to help you do this is to examine the ratio of the cost of obtaining a new degree relative to the income it will help you generate once you graduate.

This measure is very much like return on investment—the ratio between net profit and cost from an investment of resources.

Your time and tuition can be considered your investment resources, and your future income is your profit. For the purposes of this article, we’ll call this measure a return on education, or your ROEd. And of course, your ROEd depends on how much of a boost you get by going for a graduate degree and how much money you put into securing the degree.

So what graduate degrees are yielding students a high ROEd? Unfortunately, a grad degree in the humanities may provide a relatively small boost in income.The average salary for a graduate with an MA in the
humanities is $68,000. Other degrees—especially professional degrees like JDs, MDs, and MBAs—can provide a significant boost to your post graduation prospects. Stanford University Class of 2018 MBA grads have an average starting salary and bonuses of nearly $174,000, the highest in the country.

It’s clear that in some cases a graduate degree can have a huge impact on your lifetime earning potential, offering a high ROEd. Yet, this isn’t always the case, and with a low ROEd, you’ll want to weigh the benefits of a degree carefully.

Weighing a Graduate Degree

Your ROEd and other factors can help you decide whether a graduate program is worth it before you apply to graduate school.

Determining need: Determine whether or not you need a graduate degree to advance in your field. If you want to go into academia, you’ll likely need a PhD. However, if you have an undergrad engineering degree, you may not need more school to rise through the ranks of your company.

Factoring in your undergrad degree: not all undergrad degrees are created equal. Some undergrad degrees, like business, engineering, and mathematics degrees, are relatively lucrative out of the starting gate. Will a grad degree really produce a significantly higher salary? If you asked a Magic 8 ball this question, it would say “signs point to yes”: Someone with a bachelor’s in business can expect to earn an average entry-level salary of $56,720, whereas an MBA can earn a projected starting salary of $78,332.

Considering job prospects: When you achieve your graduate degree, will it be easy for you to find a job? With a PhD in an obscure subject, you may be competing for very few available positions. More general degrees may give you more job options and flexibility to grow.

Examining opportunity cost: The value of one choice relative to another alternative is known as opportunity cost. This concept is particularly relevant when you consider the financial opportunities you might lose by taking a few years off from working while you’re in school.

In other words, you won’t be getting a salary while you’re hitting the books. And if you’re already working at a relatively lucrative position, your opportunity cost could be high. You might want to factor this cost in when considering ROEd.

Note: There are ways to offset opportunity cost, such as working while you’re in school. Some employers will offer to pay for part of your schooling in exchange for an agreement that you will work for them for a given period of time.

Making conservative estimates: When calculating your own ROEd, being conservative with how much you think you will earn when you graduate, especially in your first years out of school, can be a big help. A conservative estimate helps keep you from overestimating your ROEd and can give you a better chance of arriving at a decision that’s financially beneficial to you.

Tipping the Balance

One way to improve your ROEd is by lowering the amount you pay for your degree. Look for scholarship programs that can help you pay for your tuition. Also, some degree programs offer full rides to students, often in exchange for teaching undergrad classes.

Sadly, help with tuition can be a rarity for degree programs that typically lead to high-paying jobs, such as MBAs, law degrees, and medical degrees.

If you need to take out student loans to pay for your degree, being smart about terms and interest rates can help you keep your costs down. When you’re considering student loans, shop around for lenders who offer low interest rates, low fees, and favorable terms.

You can refinance your student loans through lenders such as SoFi to help secure lower interest rates or a more flexible loan term. Doing so can be a good idea if you have a better financial profile than when you originally took out your loans.

Lowering the interest rate on your loan can reduce the amount you’ll pay over the life of the loan, helping to improve your ROEd. You can also refinance for a longer loan term—that would get you a lower monthly payment, but wouldn’t help your ROEd because it ultimately might mean paying more interest on your loan overall. Keep in mind that if you do refinance, keep in mind that you’ll lose access to federal loan benefits when refinancing for a private loan.

Also, don’t forget to look into student loan forgiveness programs. If you plan to find employment with a nonprofit or a government organization, you may be able to receive loan forgiveness under the Public Service Loan Forgiveness program after you make 10 years worth of qualifying monthly payments.

You may also want to consider looking for employers who will help you pay back your loans as part of the benefits package they offer to employees.

Intangible Benefits

Though money is an important part of your decision about whether to go to grad school, it isn’t everything. There are lots of benefits that can’t be pegged to a dollar amount, including social connections and whatever extra skills you acquire that aren’t directly related to your degree.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

SoFi Student Loan Refinance
SoFi Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891. (www.nmlsconsumeraccess.org). SoFi Student Loan Refinance Loans are private loans and do not have the same repayment options that the federal loan program offers, or may become available, such as Public Service Loan Forgiveness, Income-Based Repayment, Income-Contingent Repayment, PAYE or SAVE. Additional terms and conditions apply. Lowest rates reserved for the most creditworthy borrowers. For additional product-specific legal and licensing information, see SoFi.com/legal.

You’ve graduated from college, degree in hand, and are headed into the workforce. After countless applications, phone screens, and in-person job interviews, you’ve done it—you’ve secured your first, full-time job as an adult.

As you experience the thrill of getting your first paycheck, it can be tempting to splurge on a celebratory dinner or a new outfit for work. But before you spend your paycheck on something indulgent, it could be worth thinking about how to spend it more wisely. Here are our best tips for spending your first paycheck as you start your new job.

Set Up Your 401(k)

You’ll learn pretty quickly that you’ll end up losing a decent chunk of change to taxes. One way to offset that is to invest money in tax-advantaged accounts, including a 401(k). As a part of your offer package, you will likely receive information on the company’s benefits—including any healthcare and 401(k) options. It can seem easy to brush this information off as you get started in your career, but reviewing it closely is an important part of deciding whether to accept a job in the first place.

A 401(k) is an employer-sponsored retirement plan that allows both you and, depending on your plan, your employer to contribute to the account. Employers may offer a contribution match of a certain percentage or specific amount. Each employer offers contribution matches at their discretion, so if you’re not sure what your company offers, check with HR or consult company policy.

It’s never too early to start saving for retirement. The earlier you begin making contributions, the more time you give yourself to take advantage of compounding. Basically, the interest you earn can then be reinvested, allowing your money to grow over time.

Consider investing at least enough to take advantage of your employer match. If your employer matches 6%, contribute 6%. That way you’re not leaving any money on the table. (Once you set it up, the money you contribute will probably be taken directly out of your paycheck.)

Set Up a Checking and Savings Account

Before you get your first paycheck, set up a checking and savings account. If you already have these types of accounts, now is a good time to assess whether they are still a good fit for your current financial needs. Take the time to review interest rates at various banks and online financial companies.

For example, SoFi Checking and Savings is a checking and savings account that earns you more and costs you nothing. You can easily access your money online or withdraw cash fee-free from 55,000+ ATMs worldwide.

Once you’ve set up your checking and savings accounts, consider setting up direct deposit. That way you don’t have to worry about depositing a check every time you get paid and you can start earning interest on that money as soon as it is payday.

You can also consider keeping your spending money in a checking account and setting up automatic transfers to your savings account. It’s an easy way to force yourself to save some cash at the beginning of your career.
An interest-bearing savings account is a great place to store your emergency fund. Conventional wisdom suggests saving anywhere from three to six months of living expenses to cover emergency expenses, such as unexpected medical bills or car repairs.

We know you just got started at your new job and may not be ready to think about these scenarios, but, in the event that you get laid off or the company goes out of business, having an emergency fund will allow you to stay afloat until you find your next gig. Even contributing $50 per paycheck to your emergency fund can help set you up with a little safety net should something unexpected happen.

Make Payments for Student Loans

Another important expense you should factor into your first paycheck is student loan payments. Even if you start your new job during your student loan grace period, you should probably consider your monthly payments and start setting the money aside. If you have unsubsidized loans, use the money to make interest-only payments on your loans.

If you have subsidized loans, it’s possible to save some, then use the money you have saved to make a lump-sum payment on the loans when your grace period ends. Both of these options can help set you off on the right foot when it comes to student loan repayment. By factoring your student loan payments into your budget upfront, you get used to not using that money for casual spending on things like dinner out or drinks with friends.

It’s also a good time to review your repayment plan on your student loans. If you have federal student loans there are a variety of repayment plans to choose from, including the standard 10-year repayment plan and four income-driven plans. If you have a combination of private student loans and federal student loans, you could consider refinancing them with a private lender, like SoFi, in the hopes of securing a lower interest rate.

With a lower interest rate you could potentially reduce the money you spend on interest over the life of the loan. This could be a great option if you are on a standard repayment plan and are interested in securing a lower interest rate.

If you’re taking advantage of federal programs like deferment, forbearance, income-driven repayment, or Public Service Loan Forgiveness, refinancing your student loans may not be for you, as you will no longer qualify for those programs.

To see how much refinancing could impact your loan, take a look at SoFi’s student loan refinance calculator. When you refinance with SoFi there are no prepayment penalties or origination fees.

Start an IRA

Even if you’re already contributing to a 401(k), setting up an IRA could be beneficial. There are two kinds of IRAs, traditional and Roth. When you contribute to a traditional IRA, the contributions are deducted from your taxes, meaning you’ll pay taxes on distributions when you retire.

When you contribute to a Roth IRA, your contributions are taxed upfront but can be withdrawn in retirement tax-free—and that includes any capital gains you’ve earned.

You can contribute up to $6,000 to either type of IRA annually. If you are over the age of 50, you can contribute an additional $1,000 as catch-up contributions.

An added benefit to opening a Roth IRA: You could use it to fund part of a down payment on the future purchase of a home. As long as the Roth IRA has been open for five years, you’re allowed to withdraw $10,000 from your Roth IRA to buy your first home without any taxes or penalties. This could be a good start for saving for retirement or for your first house.

Still Have Money Left? Treat Yourself

If after paying your monthly expenses and contributing to your various savings goals you still have money leftover, you can use it to splurge on something you’ll really enjoy like trying out a new restaurant, buying tickets to a concert or a sports game, or having a night out on the town.

Or, you could use the additional money to save up toward another short-term goal—maybe an international adventure, a TV, or a new bed frame. Or if you’re feeling frugal, use the extra money to make an additional payment on your student loans.

Paying more than the monthly minimum is one of the fastest ways to accelerate your student loan repayment. At the end of the day, you’re working to earn money to live your best life, so make sure you are enjoying it and saving for your long-term financial goals at the same time.

The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Notice: SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. SoFi always recommends that you consult a qualified financial advisor to discuss what is best for your unique situation.
SoFi Checking and Savings®
SoFi Checking and Savings is offered through SoFi Securities LLC, member FINRA / SIPC . Neither SoFi nor its affiliates are a bank.

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