College graduates will get the rude awakening that they are lacking in funds soon after receiving their diploma. Hardly any college student thinks about the immediate aftermath of leaving the world of academia.

The sad truth is that you will be thrown into a harsh unforgiving world and most likely find yourself looking to your parents for answers. This can be a reality check.

But you can avoid this problem by taking action now.

There are a variety of private loan options that are completely different from student loans. Student loans limit how you use your borrowed money, to books, tuition and school-related items.

A private loan is simply money lent to you from a private organization, such as a bank or loan provider, which you have to pay back over time with a fixed interest rate. You get to choose what you do with the money. This is where discipline and responsibility come in. You are now a distinguished college grad, make your parents proud!

Down to the basics. Unless you were smart, it is highly likely that you haven’t been building your credit while in school. Maybe you were lucky and your parents took out a loan in your name and started making the payments for it while you were in college, but for 70% of you that’s not the case.

Here you are, a poor citizen (because you are no longer that poor college student), attempting to make it out on your own. You can’t just waltz into a bank and demand that they give you money, even if you secured a job already. Most loans expect that you have been working at the same place for at least 2 years. But you need the money now!

This is where your parents can come in handy, but you don’t need a dime from them– just their good name. With private organizations more than accepting co-signers, if you can convince someone who is eligible for a private loan to sign their name next to yours on a loan contract then you are almost guaranteed the amount you want. The private organization just needs to be assured that you will be able to pay the money back at the rate decided. This rate is a reflection of your co-signers credit. So you want to pick someone you know has good credit. REMEMBER THAT THIS PERSON IS RELYING ON YOU TO BE RESPONSIBLE WITH YOUR SPENDING. ALSO, CHOOSE SOMEONE LIKE A FAMILY MEMBER OR CLOSE FAMILY FRIEND B/C YOU MAY BE ATTACHED TO THIS PERSON FOR A LONG PERIOD OF TIME (no boyfriends/girlfriends or acquaintances).

Another tip, take out a little more than you need. In case you need some breathing room, you can make payments on the loan with itself. For example, if you need $5,000 to buy a car, take out $6-$7,000 in case you end up being disappointed with your weekly paychecks. This will give you some time to get used to how much your monthly payments will affect your everyday life.

Most loan contracts will drop the co-signer’s name after 18 months of full, on-time payments. This will then leave the loan and any burden that you may have felt you placed on your co-signer now onto you. This is what you want. You should have been making the payments yourself and now you have built up your credit.

Other ways to help build your credit is to apply for a credit card (after receiving your loan). Purchase something you know you can pay off right away, pay it off and before you know it, you’re building your credit in another area. Credit cards are very bad in the wrong hands. Use the credit card for emergencies only (you might even consider locking it up or cutting it but not canceling it so it keeps building your credit but you don’t have the temptation of using it).

Good luck and happy living