BEGIN FUNDING FOR YOUR FINANCIAL SECURITY

Congratulations! You've graduated from school and landed a job. Your salary, however, is limited, and you don't have much money (if any) left at the end of the month. So where can you find money to save? And, once you find it, where should this cash go?

Here are some ways to help free up the money you need for current expenses, financial protection, and future investments—all without pushing the panic button.

Get Out From UnderFor most young adults, paying down debt is the first step toward freeing up cash for the financial protection they need. If you're spending more than you make, think about areas where you can cut back. Don't rule out getting a less expensive apartment, roommates, or trading in a more expensive car for a secondhand model. Other expenses that could be trimmed include dining out, entertainment, and vacations.

If you owe balances on high-rate credit cards, look into obtaining a low-interest credit card or bank loan and transferring your existing balances. Then plan to pay as much as you can each month to reduce the total balance, and try to avoid adding new charges.

What You Really Need to BuyHow would you pay the bills if your paychecks suddenly stopped? That's when you turn to insurance and personal savings. Two items you need to "buy" before considering future big-ticket purchases:
-Health insurance is your first priority, as hospital stays can be extremely costly. If you're not covered under a company group plan, get a simple plan that will cover you in case of any unfortunate events.
-Life insurance is the next logical step, but may only be a concern if you have dependents. In fact, you're statistically more likely to become disabled than to die prematurely. Disability insurance can replace about 60% of your income if you can't work for an extended period due to illness or injury. If you can't get this through your employer, call individual insurance companies to compare rates.

Build a Cash Reserve
If you should ever become disabled or lose your job, you'll also need savings to fall back on until paychecks start up again. Try to save at least three months' worth of living expenses in an easy-to-access "liquid" account, which includes a checking or savings account. Saving up emergency cash is easier if your financial institution has an automatic payroll savings plan.

These plans automatically transfer a designated amount of your salary each pay period—before you see your paycheck—directly into your account.

To get the best rate on your liquid savings, look into putting part of this nest egg into unit trust funds to get better returns over the long term.

Stop Waiting for the Next Paycheck
Beginning your working life with good financial decisions doesn't call for complex moves, it does require discipline and a long-term outlook. This commitment can help get you out of debt and keep you from a paycheck-to-paycheck lifestyle.

Points to Remember
1. Outstanding debt is one of the biggest obstacles to saving.
2. Disability insurance is a major safeguard against financial trouble if you're out of work for an extended period.
3. Most experts recommend saving at least three months' worth of living expenses in case income stops. An easy and painless way to fund an emergency cash account is through an automatic savings plan.
4. Unit Trust funds are a potentially higher-earning alternative to bank savings accounts. But unit trust can sometimes technically lose money during an economic downturn(if the investor is not invested long enough ), and yields will fluctuate, unlike savings accounts.