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Knowing where you are financially is always important, and more so during big changes in your life. Graduation is one of those times. When you graduate, many things change, including the role money plays in your life. While going to college, your focus was on your education; being out of college, one of your primary goals should be to put together a financial plan and start paying off your student loans.

Your first step in putting together a financial plan is to find out where you stand now. You will want to find out your net worth, which is probably negative. Include all of your bills, loans and the amounts you have to pay monthly for each. Also list any income you have, from a job or other sources.

Once you have a picture of where you are now, the next step is to determine where you want to be. Don’t plan out a full year-by-year plan towards your retirement, but make some realistic guess as to where you want to be in one or two years. This will give you something to work towards. Make your goal simple, such as saving enough money for a down payment on a house or paying off a certain amount of debt.

With your current financial analysis and your goals, you can put together a monthly plan for how much money you will need to allocate towards different expenditures. If your goal is to save money for a down payment, you might consider putting more money into a savings account instead of accelerating your loan repayments. Having a simple plan will make sure that you are not impulsively spending money, but instead are actively working on your financial future.

If you are new at your job, many employers have outside advisers that can sit down with you and help you even more with your plan. Ask your HR department if your company offers such a service. If not, you can find a local financial planner and buy several hours of his or her time to go over your plan with you and make sure that you’re on the right track.

Putting together your financial plan is one of the most important pieces of paper you can produce, and it will go beyond just giving you a grade, and possibly secure your financial future.

Better jobs and brighter futures top the list of reasons that students give for going to college. College is a very important step and should be done with some planning, because not only can it increase your debt for a certain time period, but it can also provide for a lifetime of higher earnings. Obtaining a job after college is one of the first critical steps in a person’s financial life, and here are five tips to help you with it:

1. Think ahead. Many college students find it hard to think ahead a few years because of all of the pressures that are facing them in the current moment – everything from studying and completing homework to partying and other social activities. That’s why deciding on a lifetime career when just starting out in college doesn’t make sense, unless you’re set on a particular professional career. What you should do is seek small experiences in a variety of fields around your major. Pick the interesting ones. Look for volunteering opportunities, internships or even a chance to be an aide to somebody you look up to. These experiences will help you once you’re ready for a real job.
2. Utilize all available resources. Universities and colleges have entire “career departments” that are tasked with helping students with every area of job searching. Most will help with resume writing, interview skills, class selections, internships and everything else that you might not have thought of. Call up the help desk of your college and they’ll direct you to this department. Or search for “(Your College Name) career department.”
3. Focus on your interests and what you like. Put aside what other people tell you to do, and focus on what you like naturally and would do as a hobby if it weren’t a career. You will find that you will be able to study easier and everything will seem not like a “job,” but play time. And when interviewing for positions in areas that interest you, your enthusiasm will come through without any effort.
4. Network and build up the social circle. Many times, just by interacting with the alumni or other social groups around the college, you will come across opportunities that you might have missed. And because people know you, this will give you bonus points toward being offered the job first. Sign up for p2p sites like Facebook and LinkedIn to network.
5. Don’t be a nobody. The Internet is becoming critical to every industry, so make sure to have your schoolwork or projects discoverable by search engines. The first step for many employers is to Google your name and check what comes up; you don’t want “No results” to come up, as that might be a negative sign.
6. Bonus: Make sure to interview the boss as much as you will be interviewed. Your boss will have the biggest impact on how you perform at your job, as well as how you progress in the future.

When planning for a job or actively looking for one right now, keep in mind that there are many resources and people out there that can help you find the perfect one for you.

What is the one, biggest asset that most people have, which many people including you may not even realize is an asset? If you look at your life as a financial system, with assets causing money to “flow into” your life, you will want to pay attention, as this post will be about your biggest asset and what you can do with it.

The biggest asset that most people have, including you, is their earning ability. It is your ability to go out into the work force and be paid wages for value that you contribute to any organization. Many people do not view this as an asset, but when they are laid off or without a job for any other reason they quickly realize how much money they were earning and bringing into their lives.

According to the U.S. Census Bureau (pdf), an average person with “some college” and no college degree will earn $1.5 million in the United States. A person with a Bachelor’s degree will earn $600,000 more, for a total of $2.1 million. This is not a small amount of change; this is the biggest income producing asset for most people.

Realizing that the income you earn is coming from an asset is an important concept. This is not money that should be all spent before the next paycheck. Rather, you should convert this income into other assets. Cutting spending and putting more money into savings and investments is one way of doing this. Buying term life insurance is another way to protect your income if a family depends on that income.

The personal savings rate averaged less than one percent for the last two years across the United States, which means that if you start saving 2%, 5% or even 10% of your income, you will be better off than most everybody in this country. And the sooner you do that, the more of that income from your earning ability can be converted to other real assets.

Continuing with our look at financial systems, the next step, after you have clarified and identified where your money is going, is to find the area that needs the most work. This does not have to be an area where you are losing money or getting in debt, but an area that you can see will improve if you work on it. You want to choose an area that you can change pretty quickly, so that you can build momentum and then work on your bigger goals in your financial life.

For example, once I started keeping track of my expenses, I saw that in my financial system I was spending over $200 per month on coffee and pastries. I always thought that I might be spending a little bit too much in this area, but keeping track of the exact amount put a number to this hunch. It was now a fact. And I had to do something.

Then I analyzed the entire process that I went through in the morning that led to me spending this kind of money. I realized that the main driver for me going to Starbucks, or one of the alternatives, was that I was running short on time. By starting my day earlier, I would not have the same time pressure and could make my coffee at home or at the office.

Although I didn’t fully eliminate the coffee expense, I freed up about $100 per month, which is now going towards investing for my future.

You should do the same. Look at any area of your financial system and see where you can make small changes that can end up making a big difference. Don’t put ten or twenty things on your list and try to change them all at once, as it will be too big of a change to handle at once. Take one item from your list and analyze the entire process that you go through before and after making this purchase. Then consider putting part of this newfound money you’ve generated into some P2P loans on Lending Club.

Changing one item at a time will build up your confidence and the momentum to keep on changing other things. Eventually, you will have your personal financial system optimized and capable of carrying you towards your financial goals.

You do have written financial goals, right?

In an earlier post in this series, I made the point that personal finance can be viewed as a system, with money flowing into our system and money flowing out. Many times, the money leaving our system exceeds the money coming into our system. That’s called living on credit. Usually a financial system cannot sustain a prolonged period of living on credit. So the point of this post is for you to determine and clarify your financial system.

Now that the holidays have passed, spending usually goes back to “normal,” so keeping track of how your financial system works for one month will give you a pretty good picture of everything that’s involved. Get yourself a notebook or some other tool that you will use to keep track of your spending. I use my BlackBerry, which has a “Memo” program where I can quickly type in a transaction and its dollar amount. The BlackBerry is handy for me because it’s usually always with me. Find what works for you.

In tracking our transactions, we want to answer the following questions:<

1. Where is the money coming from? And how much? Here you can list of any sources that you have had money come from in the past and expect to receive money from in the future. For most, our jobs will the number one contributor. You may also include part-time gigs, interest income, bonuses, child support, proceeds from P2P loans on Lending Club, or any other source that puts money into your life. Checks, direct deposits and cash all count. Don’t forget the small cash amounts!

2. Where is the money going? And in what amounts? First, I want you to write down five to ten categories that you can assign to your expenses. Examples of categories include: living expenses, food, transportation, entertainment, fees and miscellaneous. If you know you’re spending a lot of money on one product or activity, make a category for it. For me it was coffee, so I had a “coffee” category.

Once you have your categories, use the same process that you followed with your income, and write down every time any money leaves your life. If you are spending 50 cents on a bus ride, write it down. If you spend $75 on gasoline, write it down. You want every single transaction written down; nothing should be missed, especially those small transactions that add up to big bucks.

Many people, myself included, are at some level emotional about money. It’s not just green paper. Because money is so emotional, most of us misjudge how much we make, how much we spend and where that money is spent. When committing to one month of keeping track of your income and expenses, you will have hard facts about your money. You will be able to separate the emotions from it and then proceed to make decisions based on real facts that you gather, write down and analyze.