Mackenzie Robertson is tired of her college’s emails.
Her graduation from Montclair State University was only last week — if you even can call it that, given that there was no in-person ceremony, no “Pomp and Circumstance” walk, and no bar-hopping with friends afterward, thanks to the pandemic. But the school is already sending her messages about her job hunt. Though they’re meant to be encouraging, the emails feel a little pointed given the state of the market she’s entering.
“‘Job search got you down?'” Robertson says, quoting from one recent subject line. “Yeah, a little bit.”
The emails are just another blow for 22-year-old Robertson, one of the nearly 4 million students who have graduated this year into a U.S. economy struggling with the coronavirus and Depression-era unemployment numbers. Not only did lockdown cause her to miss out on her final weeks on campus, but it also completely derailed her post-college plans.
Instead of taking her newly minted bachelor’s degree in TV and digital media and joining a company where she can shoot documentaries full-time, she’s living at home with her parents in Wayne, New Jersey. Combing through LinkedIn, Indeed, and Glassdoor postings is getting her nowhere, and her income is limited. She’s even been furloughed from her part-time retail job.
Although Robertson is thankful for her health, her career and personal life feel doomed.
“I went from ‘I’m this independent adult, I’m getting ready to graduate, I’m getting ready to move out on my own,’ and all of it flipped upside down,” she says. “Back in January, if you told me all of this was going to happen, I would have laughed.”
Graduating from college is anxiety-inducing even when there’s not a recession hanging over your head. But MONEY’s here to help young adults work through it all, updating some of the standard post-grad tips to apply to the ongoing coronavirus crisis.
Here’s what new grads need to know about money in 2020.
How to Land a Job — Or, at Least, a Side Hustle
The class of 2020 is not the first to graduate in the middle of an economic disaster.
During the Great Recession, recent graduates had to find work where they could and wait out the volatile job market — or else forge their own paths using emerging technologies. Instagram, Uber, and Venmo are just a few examples of the many start-ups launched and staffed by mostly millennials during the 2008 crisis that are now integral to people’s daily lives. Millennials used their defining features as innovators and rule-breakers to permanently change the modern workplace.
“It’s a dose of reality when you’re thrown into a crisis like this,” says Paul McDonald, a senior executive director at Robert Half, a global staffing agency. “But go back to previous recessions and see how those individuals learned to be resilient, and how that’s helped them in their careers.”
In fact, Generation Z is uniquely suited to the challenges associated with finding work during the coronavirus; distinguished by their desire to make genuine contributions, creativity, and unprecedented tech savviness.
Communication skills — especially digital — are more important than ever as companies conduct business online. Display your digital literacy by creating a personal website using platforms like Squarespace to showcase your abilities and maintaining an active presence on LinkedIn.
Hiring managers are looking for applicants who have experience with teamwork and a proven ability to think critically. Think about your last years in school. You can exemplify this by detailing how you improved the format of your student body council voting process to streamline meetings or participated in a five-person team of interns tasked with designing and launching a company initiative.
Ultimately, being able to pay the bills and gain work experience are what matter most right now. Look at every possibility, even if it doesn’t seem like your usual interests.
“The most popular entry-level jobs are still in decline, so you may need to look for positions requiring different skills than the ones you’ve spent the last four years developing,” says Julia Pollak, a labor economist at ZipRecruiter.
So where can you expect to find work? According to Pollak, the largest number of job openings are in warehousing, delivery services, and grocery stores — but there’s been a higher-than-normal demand for jobs in industries like healthcare, insurance sales, and e-commerce.
Contracted work and part-time positions are also going to be more available right now than full-time positions. Taking on multiple roles can bolster your resume, while part-time gigs could potentially become full-time work. You can get started by joining sites like Fiverr and Upwork that match employers to freelancers with the right skills.
Here’s the bottom line: It’s hard to find work right now. You will likely have to look beyond your ideal job titles and be clever to make yourself stand out. But adversity is part of life, and it’s important to remember that where you start your career doesn’t always determine where you’ll end up.
How to Master Saving and Budgeting From Your Parents’ House
The class of 2020 got blindsided, according to certified financial planner Bobbi Rebell. Usually, there’d be warning signs before a recession, and maybe even a little time to prepare. But not with the coronavirus.
As a result, new grads might need to adjust their outlook when it comes to saving and budgeting.
“Right now, we’re in a very unique and hopefully finite time period,” Rebell says. “It’s more important to focus on financial foundation than financial independence.”
You may be itching to leave your childhood bedroom for a sleek apartment in a new city, but that’s likely off the table for now. Rather than wallow, Rebell says you can use this time period to set yourself up for the future by paying down debt and saving money.
For example, certain student loan payments are suspended for now, which may allow you to tackle the principal without wasting money on interest (more on that below). You may have gotten a partial refund from your school for unused housing, meal plan or course fees, which could be the start of your emergency fund.
“No one can give you back your last couple months of in-person college, of course, but that’s one way to spin something positive out of it,” says Rebell, who works with credit card consolidation app Tally.
If you’re living at home, you should check with your parents to see if they need money. Get your debt under control, start putting aside three to six months of expenses in an emergency fund, and start looking at how to achieve your savings goals.
Rebell recommends creating a budget starting from zero. Although you may still have a cell phone or Netflix bill, your budget can probably be pretty tight. Your expenses are likely low — you’re not buying interview clothes, purchasing transit passes or gas, or going out with friends, after all. If you save, you’ll be better prepared for your eventual move-out when the pandemic ends.
“Think of it as an inventory. You’re taking account of all your money coming in — hopefully there is some — and where your expenses are,” says Chad Parks, the founder and CEO of Ubiquity Retirement + Savings. “You’re looking at income minus expenses. Is there anything left over?”
As you’re creating your budget, Parks says not to forget to pay yourself first. Pick a savings goal that’s livable for you — even if it’s $100 a month — and put it at the top of your budget. Then list out your other expenses. When you get down to the bottom, the leftovers are “your go-have-fun money,” he says.
Though it may seem silly to save for retirement when you don’t even have a real job yet, you may want to consider setting some cash aside for your golden years. It’s a numbers game. Because of compound interest, the earlier you start, the better it will be in the long run.
“$100 a month today will be worth thousands to you in the future, literally,” Parks says. “Saving throughout your life will always be a necessity. If you build that habit today, then it doesn’t feel like you’re making sacrifices.”
How to Deal With Student Loan Payments When the Future’s Unclear
Student loans are many young adults’ first foray into managing debt. And if you’re like a good chunk of your peers, that has you stressed.
Roughly two-thirds of bachelor’s degree recipients have debt when they graduate, with a typical balance of about $30,000, according to The Institute for College Access and Success. It’s a burden that’s associated with plummeting net worth, delayed home ownership, and lower levels of financial security.
There is a small silver lining, though. Federal student loans offer repayment perks that can make them easy to manage — if you know about them. And this year, you’ve got the added benefit of 0% interest during your first months out of school.
To start paying your loans back, you’ll automatically be placed into a standard 10-year repayment plan, with your first payment coming due in November (or six months after you graduated). Under that plan, your monthly bill would be roughly $100 for every $10,000 you borrowed, so an average grad would owe about $300 a month.
“More often than not, people are surprised when they first see that monthly amount,” says Scott Snider, a certified financial planner with Mellen Money Management in Ponte Vedre Beach, Florida.
Despite its name, many borrowers opt out of the “standard” payment plan for one that’s more affordable. Follow this rough guideline: If your income is more than what you owe — and you don’t have other substantial debts — you can likely stick with the standard repayment plan, Snider says.
But if, like many graduates, you borrowed more than you’ll make in your first few years out of school, you should sign up for the government’s income-driven repayment option. While there are a few variations, most lower your monthly bill to 10% of your discretionary income. (That’s determined by subtracting the federal poverty guidelines for your family size from your adjusted gross income.)
If you’re planning to work in the public sector, you need to sign up for an income-driven repayment plan to access Public Service Loan Forgiveness, the program in which you can have your debts forgiven after 120 eligible monthly payments. But if you’re a private sector worker with significant debt, these plans can still offer loan forgiveness after 20 or 25 years of payments.
Have no idea what you’ll earn next month, let alone what you’ll be able to afford in November? Err on the side of caution, and enroll in an income-driven plan, Snider says. You can always increase your payments once you’re bringing in a steady salary.
“That way you’re not stuck climbing out of a hole,” he says.
Finally, if you’re part of the 5% of undergraduates who also have private debt: Focus your energy on paying that off as quickly as you can. Interest rates are higher, and the protections are fewer. If you’ve scored a good-paying job, consider refinancing your private debt to access a lower interest rate.
How to Build Credit (and Get a Credit Card) in a Pandemic
When you imagine capital-A adulthood, you probably envision having a job, a house, and a credit score. And while you might not be landing a 9-to-5 or a white picket fence anytime soon, you can get started on your credit.
Bruce McClary, a spokesman for the National Foundation for Credit Counseling, says it’s a smart idea for new grads to start building credit, pandemic or not. Because it sends a message to lenders that you can responsibly handle a line of credit, having a good credit score can affect whether you qualify for loans, get certain apartments, and access low interest rates — all of which will be important once the pandemic ends.
In order to establish credit, you’ll probably want a credit card. But the coronavirus crisis means that “in the short term, the options may be a little more limited in terms of starter lines of credit and what features might be associated with those lines of credit,” McClary says.
Major credit card issuers are becoming risk-averse because of the economic conditions. Some have already begun reducing people’s credit. A survey from CompareCards found that 25% of U.S. cardholders had their credit limits decreased or cards completely closed by the issuer in April. Millennials and Generation Z were most affected.
While this response isn’t unusual — it happened during the Great Recession, too — McClary says it could impact people entering the market for the first time.
“It’s not like you won’t be able to establish credit,” he says. “You might just have less to choose from when shopping around.”
That said, you shouldn’t just sign with the first company that mails an offer to your parents’ house.
“It’s up to you to scrutinize the details,” McClary says. “You really need to dig down into those cardholder agreements to see what you’re getting into.”
You’ll especially want to look at a card’s interest rate and fees. McClary says you can expect to get an annual percentage rate (APR) of 20% if you have no credit history. But fee structures will vary a little more widely, so you should research whether the issuer charges for statements, foreign transactions, or more.
(FYI: MONEY’s favorite low-interest card is the Visa Titanium Signature Rewards from Andrews Federal Credit Union. Our top no-fee card is the Wells Fargo Propel American Express.)
You should also avoid getting sucked in by flashy rewards or points systems, especially if you’re not planning to use them.
“You don’t want to be distracted by things that are not going to be most directly affecting your budget, and that would be how much they charge for interest and how much you’re being charged,” McClary says. “Everything else is window dressing at this point.”
After you’ve got your first card, wait. Use it when you need it, and make payments on time, but don’t apply for a new card for at least 12 months. Your credit score needs time to grow. With any luck, you’ll exceed the average 630-point score for the 18-24 age group in no time.
“This is your foot in the door,” McClary says. “Be patient.”
That’s good advice in general for new grads.