Almost half of recent college grads are underemployed. Here are 4 tips to bridge the financial gap

Historically, college graduates have tended to find jobs faster and experience lower unemployment than workers without a degree. But recent data suggests it’s now harder to find a job that fits your skill set once you graduate.

According to the Federal Reserve of New York, 42.5% of recent college graduates (aged 22 to 27 with a bachelor’s degree or higher) are underemployed as of December 2025 — the highest rate since October 2020. Underemployment refers to working in a role that underutilizes your skills, usually at a lower wage or in a part-time position.

Younger workers are also dealing with stagnating wage growth. According to an October 2025 JPMorganChase Institute report, income growth has slowed across age groups, with workers aged 25 to 29 experiencing the sharpest slowdown.

Underemployment may be better than unemployment, but it can put a real strain on your wallet. Here are some tips and tools to help recent grads bridge the gap.

Fixed costs are essential expenses that you pay consistently, like your rent, phone and utility bills or car insurance. Some adjustments could be more substantial, such as finding a roommate to help split living expenses. But there are simpler ways to make meaningful improvements. For example, you could lower car insurance costs by bundling home and auto policies or removing perks you don’t need, like roadside assistance that’s already offered by your credit card or vehicle warranty.

If you’re interested in trying a budgeting app that can help keep track of your day-to-day spending, Rocket Money lets you link your checking, savings, credit cards and investments so you can see everything in one place. You can set alerts for your spending and savings goals, and Rocket Money concierge can help get you the best rates for current bills, like phone or cable and even car insurance.

Many of these perks are available for free, but some require a premium membership — which uses a “pay what you think is fair” approach. Rocket Money presents a slider, typically between $7 and $14, letting you choose the price based on the value you feel you’re getting. Your features stay the same, regardless of what you choose to pay.

While you should keep around one to two months worth of expenses in your checking account, letting large sums of money sit there is likely a lost opportunity.

According to the Federal Deposit Insurance Corporation, the average national rate for interest checking accounts is just 0.07% as of Feb. 17, 2026. If you let $10,000 compound daily for 10 years in a checking account with that average rate, you’d only earn an extra $70.

If you still want to keep your money easily accessible, consider putting it into a high-yield savings account (HYSA). Putting that same $10,000 into a Western Alliance Bank High-Yield Savings Account will earn you a 3.8% APY (compounded monthly). Over 10 years, you could earn over $4,600 in interest alone.

This HYSA also allows for unlimited withdrawals, meaning you can access your money pretty much whenever you need it. If possible, keep enough in your checking account to cover immediate bills, but let the rest sit in an account like this that earns higher interest.

Even if you’re cutting costs wherever you can, sometimes a little extra income is necessary to cover expenses. There are many popular side hustles, but some require you to have a rentable property or a car in order to participate. If you’re looking for something with a lower barrier to entry, consider selling some of your old things online or offering up your skills as a freelancer.

E-commerce marketplace eBay has been a household name for a while now, but there are several other online shops where you can sell used, vintage or unique items. If you have a collection of older clothes and accessories you no longer want or need, Depop (which eBay recently acquired in February 2026) is a fashion marketplace that helps old styles find new lives. With an Instagram-like interface and the ability to follow users on the app or comment on listings, Depop can help sellers find the right audience.

If you’re more fond of your current possessions, you may have a skill or trade that people are in need of. Through Fiverr, you can offer your freelancing skills to a wide market, whether you specialize in graphic design, business consulting or even music. Fiverr offers a lot of ways to customize your offerings, including the ability to create tiered packages for upselling or more involved tasks. You will have to be okay with giving up a fifth of your earnings, as Fiverr takes 20% of the purchase amount.

If you’re underemployed, especially for longer periods of time, you may be forced into making financial decisions that could negatively impact your credit score just to make ends meet. There are a few methods you can take to minimize or sidestep any negative impact, though.

For example, you may find yourself carrying a balance on a credit card. Typically, you’d be charged a variable APR on that balance (the average credit card interest rate on accounts assessed interest was 22.30% in November 2025, according to the most recent Federal Reserve data). But a 0% APR credit card can help you pay off your balance without interest charges or a hit to your credit score.

With the Wells Fargo Reflect® Card, you can get a 0% intro APR for up to 21 months from account opening on purchases and qualifying balance transfers, followed by a variable APR of 17.49%, 23.99% or 28.24%. Just know, balance transfers need to be made within 120 days from account opening to qualify for the intro rate.

If you’re paying for a streaming service or a phone bill, there’s a chance you can get those added to your credit report and boost your FICO Score. With *Experian Boost®, you can link certain monthly payments, like streaming service or phone bills, and have them added to your Experian credit report. Plus, the service doesn’t report any late or missed payments, only positive ones, so it shouldn’t negatively impact your score.

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*Results will vary. Not all payments are boost-eligible.Some users may not receive an improved score or approval odds. Not all lenders use Experian credit files, and not all lenders use scores impacted by Experian Boost.