Now is the perfect time to get your finances in order before the new year begins. This guide will show you some ways to stay on track and create positive money habits, along with ways to ethically invest your money.Â
It can be easy to overspend or practice unhealthy finance habits under the guise of womanhood or the assumption that being good with your finances is something that is reserved for men but that is not the case. As we step into adulthood and leave college it will become progressively more important to be good with your money, save it, grow it, and invest it. The main tip that I can give to any college women on managing their finances is to diversify the places in which they place their funds in an organized way. Here are some things you can do to start with if you haven’t done so already.Â
- Place your money in a high-yield savings account that is separate from your checking account. If you already have a traditional savings account you should be making sure that it is not connected to your checking account. This will make it harder to have access to the money that you place in it and make you think twice before you use any funds that you are dedicating to emergencies. You should also be looking for banks that give you the highest interest rates so that your money isn’t just sitting in the account and it is growing. As of now Capital One and American Express are some traditional banks that offer high-interest savings accounts with some of the best rates nationwide at about a 4% growth rate. There are also nontraditional banks that are usually solely online platforms with no physical branches such as EverBank which offers a 4.75% APY. When researching what high-yield savings account you should transfer your money to, you should consider the minimum balance you need to open these accounts, the APY, whether you prefer in-person or online banks, and if the banks offer bonuses for opening an account with them.Â
- A second option is to put your money in a Certificate of Deposit account which is available through many traditional banks. They offer higher interest rates than high-yield savings accounts at the expense of low liquidity. CDs have time deposits where your money is locked into the account for a set period of time depending on which one you choose and this can range from 6 months to a year or longer. This option is good for people that have an emergency fund that they can access but would also like to have an account with a fixed rate of growth where they won’t be able to access the money without a penalty.Â
- Another thing you should consider doing to improve your finances is to invest any excess money that you have (no matter how much or how little it may be) into stocks. This may seem daunting and something like gambling but once you learn the fundamentals of investing you will realize it is not. Stocks in general are unpredictable but many are safer than others and can almost guarantee you a safe amount of growth over the years. They don’t have to be risky or complicated . There are a variety of industries that you can invest in by looking into what will accumulate traction in coming years.
 This brings me to my next point on ethical investing. As someone who prioritizes being ethical over making a profit, I would advise anyone to stay away from investing in companies that bring harm and destruction to our communities and the earth. The biggest example is any sort of weapon manufacturing company. Last semester in the spring of 2024 we saw the influx of nationwide protests from students calling for their universities to divest from defense contractors which is something that shouldn’t even be a thing to begin with. There are infinite alternatives to this and other industries that you can invest in such as renewable energy, sustainable agriculture, education, health and wellness, and green technology. This can bring up an additional layer of discourse on what is ethical and what is not because it is hard to exist without knowingly or unknowingly participating in unethical practices. However, there are some avenues where this discourse is clearer than others, and in terms of investing in weapon manufacturing that is simply not ethical.Â
Investing is something that allows me to be active with my money and helps me curb my desire to overspend after I receive any income because I don’t like the idea of my money sitting in my checking account. So by investing and monitoring stocks, I can watch it grow and have a separate place for it. The most important thing to do when beginning to choose what stocks to invest in is to choose a platform where you will do your investing. This can be online or through an app and you should do your research on what type of features you want access to. Some apps that people usually use to invest are Robinhood , Fidelity Investments , Acorns and Webull . When choosing what app to download you can look at whether they have commission-free trading as well as what type of research tools it offers users and whether it’s best for long-term investments and people that are advanced or if it’s easy for beginners to use. Once you pick a platform you can then start to choose your stocks based on the type of industry it is, the financial health of the company throughout the years, and by assessing your risk tolerance. As you spend more time researching stocks you will notice that it is something that is very nuanced and that there’s no one right way to do it because there’s a myriad of ways to grow your money. These are just some base-level tips for a beginner and you should make sure to take the time to learn what to do. The last tip I can give for anyone investing in stocks is to diversify your portfolio so you aren’t putting all your eggs in one basket. This can be done through investing in mutual funds, ETFs, individual stocks, international markets, and different sectors. Some stocks that you can invest in as of now that are seeing growth are Applovin Corp (APP), SpotIntuitive Surgical (ISRG), Nuveen ESG (NUSC), and UnitedHealth (UNH).Â
- Aside from investing you should also be using a credit card to build your credit. This is another alternative to paying with things through your checking account as it has more benefits and you can reap cash back rewards, miles, and points depending on which credit card you choose. As with any other step you should be researching which card is best for you based on your interests and goals. If you like traveling then you may opt for something like the Capital One Venture rewards credit card which offers a “one-time bonus of 75,000 miles once you spend $4,000 on purchases within 3 months from account opening, equal to $750 in travel.” If you are looking for a credit card with the best cashback rewards you can get something like the Discover It Cash Back card which offers “5% cash back on everyday purchases at different places you shop each quarter like grocery stores, restaurants, gas stations, and more, up to the quarterly maximum when you activate. Plus, earn unlimited 1% cash back on all other purchases.”. When choosing a credit card you should be looking at the annual fee and weigh it in terms of the rewards it will provide you with. It’s best to use credit cards as a tool and not to your detriment so don’t spend more than you can pay each month based on your income just because you can. Make sure you are making your payments on time each month to steadily increase your credit score.Â
Lastly, before you do any of these things it is important to have a healthy mindset when it comes to your finances and to be generating income. If you have time while you’re in school you should get a part-time job to have some money to save, invest, and spend. You should also set up a budget for yourself based on your income that allows you to place it in a range of places. With this budget, you should live below your means so that you are not placing yourself into debt or overindulging in spending on things that will not bring you financial stability or growth long term.