Last Updated: June 22, 2009

If you're approaching high school or college graduation, and you haven't learned about money, it's time to immerse yourself in that subject. Getting a good grade in money management is essential to your financial well-being over the course of your life.

You most likely will earn more money than ever before if you've recently graduated from college. By the same token, you'll enter the workforce with more expenses and liabilities than ever before as well. And, if you're just graduating from high school, it's quite possible that you will face the prospect of daunting student loans for college and the allure of credit cards.

As such, financial planners recommend that you take money matters seriously. If you're graduating from college, here's what financial planners suggest:

1. Pay yourself first. Develop a spending plan before you do anything else," said FPA member, Kim Nourie, CFP®, CPA, of Cross Financial Services. "If you don't start out now with good spending habits, it's hard to change them later. If you spend what you have and didn't save beforehand, it usually turns out that you are living paycheck to paycheck." For his part, FPA member, Dave Yeske, CFP®, of Yeske Buie recommends saving at least 10 percent of your earnings from day one, period. "Don't even think about it," he said. "If you start saving now," Nourie said "the compounding growth will make a huge difference later and then you can use some of the growth for periodic extravagances and know that you still have money working for you."
2. Keep track of your income and expenses. Yeske recommends using Quicken or Mint.com to keep track of your money. "Knowledge is power," said Yeske. "You want to be as frugal as possible. Don't be too extravagant when you are young," he said. However, that doesn't mean you should deny yourself all of life's luxuries. "Make sure you put some fun stuff in your spending plan," Yeske said. "It makes it easier to stick with the rest."
3. Establish an emergency reserve fund. "I recommend six months of living expenses for new graduates in our current economic environment," said Nourie.
4. Contribute to your 401(k) plan. "If you're employed, and your employer offers matching retirement contributions, save enough to maximize the available matching," said Nourie.
5. Live at home instead of renting. "If you are coming out of school with debt and your parents will allow you to live at home rent free, live there and pay off debt in lieu of having to pay rent," said Nourie. "If living at home rent free isn't an option, get a roommate and save the difference.  Splitting the cost of utilities, cable and water, etc. can help you save money." In addition, Yeske recommends that you purchase renter's insurance.
6. Plan ahead. Look out a few years and determine what your needs will be. "Do you need to buy a car? Do you plan on getting married and starting a family?  Do you plan to buy a house? If so, be sure to develop a monthly spending plan that incorporates the saving needed for these items," said Nourie.
7. Save your raises. "When you get a pay raise, make sure that you increase your savings as well," said Nourie.
8. Consider contributing to a Roth IRA. "If you're in your 20s," Nourie said "contributions to a Roth IRA or Roth 401(k) can be more beneficial than contributions to a traditional IRA and 401(k).  In your later years, distributions from the Roth will be tax-free.  With taxes most likely on the rise in coming years, it is much more likely that you will be in a higher tax bracket later compared to now — having a source of tax free income in these later years will be a plus."
9. Check the fine print on your student loans. If you have student loan debt, understand what the interest rate is and how it can change," said Nourie. "Some loans offer options of minimum payments tied to your income. Start paying down the loans with the higher interest rates first."
10. Establish credit. "If you want or need to establish credit, buy reasonable furniture with a zero percent for six months arrangement," said FPA member, Samantha J. Kopek, CFP®, EA, vice president and senior advisor with GTrust Financial Partners. "This is usually set up as a credit card." Yeske suggests you only use credit cards for convenience. "Don't charge anything that isn't part of your monthly budget," he said.
11. Get your credit report. The Fair and Accurate Credit Transaction Act (FACTA) was enacted to ensure that you have easy access to your credit report each year. To receive a free copy of your report from the three major credit bureaus call 877.322.8228 or order online at AnnualCreditReport.com. "Keep in mind that insurance companies, lenders and potential employers have the right to view your credit and base a decision on that information," said Kopek. Learn more about repairing your credit.
12. Consider hiring a financial planner. Hiring a financial planner when you are young and just starting out in life can help you start life out on the right financial path. Planners can help you organize your finances, help you identify your goals, and help you understand the tradeoffs you will need to do to realize your goals.

Meanwhile, if you're soon to be or just graduating from high school, financial planners suggest:

1. Apply for scholarships. "If you are going to college, look and apply for as many scholarships as you can," said Kopek. "Make sure that you have completed the Free Application for Federal Student Aid (FAFSA) by March 1 of your senior year. Learn more about the FAFSA.
2. Go to summer school. "If you go to college, consider summer school classes," Kopek said.  "This will get you through faster. Also check into renting your textbooks or buying them online to avoid the pricy bookstores."
3. Live within your means. "Consider working part-time during college, clipping coupons, and shopping smart," said Kopek.  "Get a roommate to help lower the cost of rent."
4. Pay yourself first.  "If you have a job, start contributing $25 or $50 per month to a Roth IRA at a no-load mutual fund company," said Kopek. "Also, put 10 percent of each paycheck into a savings account."
5. Beware of the credit card trap. "Do not finance living expenses with a credit card," said Kopek.  "Create a reasonable and usable spending plan or budget."
6. Balance your checking account. "Being aware of your account balance keeps you out of trouble," said Kopek.
7. Consider carpooling or public transportation to save on fuel costs. "If you drive, plan your day's driving in the most direct route possible," Kopek recommends.