Why you should live on a tight budget after college

Now that you've graduated, you might be ready to drop your tight budget. Here's why keeping it up could be the best thing you can do for your finances.

When you finish college and land your first "real" job, it's easy to equate enjoying your new adult lifestyle with freely spending all your money as it comes in. While this impulse is normal, it's not great for your finances in the long term.

The period after graduation is an opportunity to establish healthy financial habits early. Here's how to start your postgraduate life off on the right foot by living on a tight budget. 

Beware the urge to procrastinate.

Sure, you'll work on your financial goals later. Budgeting, paying off your student loans, and saving for retirement — can't you wait to do these things until after you get your first raise, or get a better job, or get married and buy a home?

The truth is that life after college is the best time to establish healthy financial habits. This is the time in your life when you'll have the fewest financial obligations. You're a blank slate, and it's easy to shape your financial habits. Once you add in responsibilities like a mortgage, day care costs, and a credit card debt hangover from your honeymoon, changing how you manage your money becomes a whole lot more difficult. 

Most new graduates can't wait to leave the ramen-and-roommates budget of the last few years behind. No one should begrudge you for wanting to improve your lifestyle, but here are six tips for doing it in a healthy way. 

Now that you've got money coming in, you'll suddenly start to notice more and more tempting things to buy. There's nothing wrong with spending your hard-earned cash. Just don't let it get out of control. You can keep your spending in check by monitoring it, whether with the aid of an app, a spreadsheet, or old-fashioned pen and paper. Tracking your spending helps ensure that you spend money on what you really want and not on impulse purchases. This frees up cash to go toward your financial goals. 

The period after graduation is full of changes. You may be shopping for a new apartment, a new car, and a new wardrobe all at once. During this time of upheaval, keep your eye on the ball and take into account what you can actually afford.

Avoid splurging on an overpriced car or apartment by setting maximum spend budgets before you make any decisions. Keep in mind that you'll only know those numbers once you know what it costs to take care of your other financial needs first, so prepare to crunch some numbers.

With new income also comes new access to credit, and soon those preapproved offers will start appearing in the mailbox. Using a credit card responsibly (by paying it off every month) can improve your credit score, but watch out for purchases you can't afford. Track your expenses to help avoid charging too much to your credit card. If you do overspend, remember to make (at least) the minimum payment. That way, you'll avoid penalties and protect your credit score. 

Amazon Prime, Audible, Crave, HelloFresh, Netflix, Spotify ... It's easy to sign up for a few free trials and accidentally find yourself shelling out hundreds of dollars per month in recurring fees. Before you sign up for a subscription service, ask yourself whether you really need it. If you think you can't live without taking advantage of a free trial, set a calendar reminder before the cancellation date. If you change your mind, cancel before it renews. 

If you've graduated with student loan debt, you'll eventually have to start paying it back. Paying back debt can be a pain, so avoid the shock of your loan going into repayment by budgeting for it now. You could also get a head start and achieve debt freedom sooner by making payments before the grace period ends. 

The hardest part about saving money isn't finding the room in your personal budget; it's establishing the habit. Saving money for your future can be boring (and therefore easy to ignore) so set it and forget it with a small automated monthly contribution. You won't feel like you've lost any money since you won't be manually taking it out, and you'll grow your nest egg. When you earn a raise, don't forget to increase the contribution accordingly.

These strategies are an excellent starting point for establishing healthy financial habits. As you become more established and earn more money, you'll be ready to up your financial game thanks to the strong financial foundation you set up for yourself now.