Helping a reader out:

“Hello and my name is Jacob. I just graduated with a degree in mechanical engineering. I have 5k in high interest credit card debt, 21k in student loans, and 8k in a car loan. I just received a job working for a company that designs cranes and I am starting out at 55k a year. I don’t know what I should do next. Should I be trying to buy a house or stay in my (very inexpensive) apartment? I have six months before my student loans are due so should I ignore them for now? The biggest one is very high interest (18%) due to my parents at the last minute not being able to pay for a bunch of expenses. What order should I be looking at things? Should I be putting money into the company retirement plan? Im still pretty young so I have a few years to start that. Basically I am just completely lost, help me please :)”

This is a great email because I think it reflects a lot of people coming out of college. It’s a whole different world with different priorities.

My advice to him was fairly short and sweet.

1) Stay in the apartment
If it is inexpensive, wait until you have saved up enough for a sizable downpayment to go the house route. There is no reason to rush this and it would even hurt you in the long run. Plus housing prices will continue to fall as foreclosures increase.

2) Get to work on the credit card debt. Start getting rid of that sucker ASAP. Even better, ff you can, transfer it to a zero percent interest card.

3) Consolidate those student loans. Since the majority is high (ridiculously high, I thought my 11 percent I had for one while unemployed was crazy high) consolidate those SOBs. Federal consolidation rocks because it is capped at 8.25% This means you get an automatic lowering of your interest rate. Nice.

4) Make sure you immediate start investing in the retirement plan ASAP. The company match is FREE MONEY. Its like the company saying, oh you’re going to give yourself 100 bucks when you are 60? Ah what the hell, heres 100 more just cause. Not to mention the younger you start, the more years for compound interest and the more moola you will have.

I also gave him a few other points, but I am curious what you, the readers have to say to him, what are your ideas?

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