This story is part ofCNET’s coverage of how to make smart money in an uncertain economy.
I’m officially a year away from graduating from college and I have no idea what’s next. A job, hopefully. High school maybe? For me, college was about preparing me to enter the workforce equipped with all the skills I need to be successful. Now that it’s time to actually apply for jobs and plan for long-term financial stability, that’s pretty scary.
Entering the labor market, even in a healthy economy, presents endless challenges. And regardless of the debate over whether we’re in one, the past few months have shown how difficult it can be to remain financially stable in a volatile economy. Inflation is at an all-time high and wages are not keeping pace with the cost of living. Higher interest rates also make homes, cars, and other large items more expensive and inaccessible.
The thought of entering the labor market is all the more frightening.
Older generations who have already experienced recessions may be better prepared. Millennials born roughly between 1981 and 1996 experience deja vu. Many in this cohort entered the labor market just as the Great Recession was taking place, and the years that followed significantly changed their career trajectories and financial path.
I met with five millennials who graduated from undergraduate school between late 2007 and 2009 and managed to weather the last economic downturn. I wanted to learn how it affected them, from layoffs and budget cuts to career pivots, and what skills they developed that were most critical to staying afloat. Each had a unique experience that impacted how they approach finance today. As they reflect on that time now, they see the hard-earned lessons and share their best advice with the next generation.
What stood out was the power of investing in the future, like utilizing employee match programs and regularly contributing to 401(k)s and Roth IRAs. The millennials I spoke to all encouraged Gen Zers to invest early in their careers. And each of them had even more wisdom to share with us — including how to make the most of your freshman years out of college, how to talk money with employers, talk finances with partners, and build successful careers in unexpected ways.
Here’s what they shared via email.
Accept the professional uncertainty and be flexible
Katie Oelker, St. Paul, Minnesota
After graduating, Katie Oelker worked for her parents in the auditing department of a bank, mainly to build up savings and pay off private student loans. This eventually allowed her to go back to school to pursue her Masters in Education.
Since Oelker did not want to pursue a career in banking or auditing, she repeatedly took advantage of various learning opportunities such as training courses or conferences that her job offered. “If you don’t like what you do after graduation, or even if you do, there are always opportunities for further education that can help advance your career down the line,” she told me via email.
This focus on career development served her well when she decided to make another switch, this time to become a certified business education educator. After teaching courses from personal finance to marketing at two different high schools, she now runs her own business as a freelance writer and money coach. Her flexibility in her vision allowed her to navigate the recessionary job market and explore new industries.
“I’ve never been afraid to open new doors and try new things when it comes to career and educational opportunities, and it’s paid off,” she said.
Talk to your partner about money, even if it’s difficult
Jared and Katie Pogue, Atlanta, Georgia
Before they married, Jared and Katie Pogue learned they needed to find productive ways to talk about money, specifically how they could afford to start a family. The two had radically different views on financial planning, which caused concern. Katie said she has many long-term goals, while Jared described his approach as “ignorant optimism”.
They developed a routine for talking about money. They set a time limit of one day a week and slowly worked through their finances. They were eventually able to align their goals, which helped them make big financial decisions, including how to fund a home, when to have children, and whether to go back to school. They developed a division of labour, with Jared taking care of the daily and monthly payments and Katie overseeing the longer term planning. No one could do their part alone.
“Once we started making tangible progress and got on the same page, our financial talks were a lot more fruitful,” Jared said.
Despite your doubts, negotiate more
Sara Gifford, Hyattsville, Maryland
Sara Gifford’s first full-time job out of college wasn’t her ideal choice. However, due to the tight job market, she was forced to accept an offer from the company where she had completed an internship.
“I chose a job where I was expected to work 60+ hours a week for a ridiculously low wage, and I didn’t negotiate my salary or benefits because I felt the employer has all the power,” she said. Accepting such low pay at her first job made it harder to push her salary benchmark in future negotiations.
Though recessions put more pressure on workers to avoid higher wages, Gifford said that shouldn’t stop them from negotiating other benefits like commuter grants, paid leave and flexible or mobile working hours. If the employer doesn’t agree with any perks, it could be a sign to keep looking. “If the company withdraws the offer, that’s such a red flag.”
While she regrets not asking for better pay, she is proud that she took advantage of opportunities to network and learn new skills. All of which served her well when she decided to leave and build her career. Today, Gifford runs her own marketing strategy company.
Identify your money priorities
Adam Eisenberg, Huntington Woods, Michigan
Adam Eisenberg still works at the company that offered him his first job in distribution logistics. After college, he got his financial goals in order, which meant he was prioritizing student loan payments immediately — rather than moving out of his parents’ house.
“I used my commission checks to pay off my debt. It took four years and I lived with my parents for the first three, but it was worth it.” While everyone’s priorities are different, identifying them early can help you make better decisions about where to go money should flow.
In fact, Eisenberg originally had a second job offer he was considering and took a similar approach when comparing his options – prioritizing what was most important to him. A higher commission rate, he decided, would ultimately be more beneficial to him even if the base salary were lower. Another attractive aspect was the company’s growth potential.
Eisenberg said those entering the job market should look beyond their normal job search to “ensure the foundation for future success is in place.”
Budgets can be your calm in the storm
Jonathan Schrull, Indianapolis, Indiana
At the end of 2008, Jonathan Schrull was fired from his second job after graduating. He was unemployed for six months before securing a new job and felt like he had to put off starting his long-term career and putting off saving and investing. In his opinion, this cost “a lot of money in the long run”.
In retrospect, he found that outhelped relieve some stress. “Seeing the numbers in front of me made the situation more tangible and easier to understand,” he said. A way to track his expenses even without an income helped him find new ways to reduce his expenses. It’s important to look at your entire financial picture, not just income, because “the numbers don’t lie.”