Congratulations! With your diploma in hand, you are about to start out on your own. Your college experience has prepared you for the work world, but are you ready to tackle your financial future?

Marc A. Hebert's Money Sense column sig

There are new financial tests ahead, and you will need to consider your goals in life. Here are a few areas to review to get you started on the right track.

We mentioned goals, and these are the basis of your financial life. Ask yourself some questions. What do I want to accomplish? This could include purchasing a new car or coming up with a deposit to rent an apartment.

Your goals will probably have different time frames. Your car purchase may be a short-term one while others, like saving for a house, may be further down the road. You will probably have many goals. It will become important to prioritize and determine how much you will need to save to meet them.

A budget becomes important as well. To begin the budgeting process, list the income you will have each month. Next, list all of your current expenses. Don’t forget to include those items that you may pay only once a year. An example is auto insurance: This could cost you $1,200 per year, which is really $100 per month. In a perfect world, your income exceeds your expenses, producing extra to meet your savings goal. If it doesn’t, it’s time to review your expenses and see where you could cut down on your spending.

As much as you plan your expenses, the unexpected does pop up. This is a situation in which having an emergency reserve is helpful. It might be the car needs repair or a medical bill needs to be paid. The usual suggestion is to have three to six months of expenses of cash reserves on hand. It is important to review the amount, as it depends on your unique situation. Your job situation, for example, may affect the amount. If it isn’t stable, perhaps you want more saved in the emergency reserve, just in case you do lose the job.

The other area that often troubles recent graduates is debt management. Your debt might be in the form of student loans or credit cards. In order to manage this, you will need to track your loan balances and interest rates. This forms the basis for developing a strategy to pay it down. If it seems an impossible task, there might be some help in the form of employers offering to assist with student loan debt, lender repayment options and loan consolidation or refinancing. Be particularly careful when considering loan consolidation or refinancing your student loans, as there may be benefits to federal student loans you will lose if you refinance.

It is important to start building strong credit. Having good credit will make other areas of your financial life easier. Avoid late payments on existing loans. Monitor your credit report. (This is also a good way to avoid identity theft.)

Another area to review is your insurance needs. What kind you need and how much depends on your circumstances. If you rent an apartment, you will need renters insurance. This will protect you against the loss or damage to your personal property. If you own a car, auto insurance is a must. Another type of insurance you need is disability insurance. This will provide income in case you can’t work due to a disability. You might also consider life insurance — an amount to pay for last expenses and your debt may be a prudent idea. Make certain you have health insurance.

Finally, think of the real long term and participate in your company’s 401(k) plan and/or set up an IRA.

Marc A. Hebert, MS, CFP, is a senior member and president of the wealth management and financial planning firm The Harbor Group of Bedford. Email questions to