Congrats On The Job! 5 Financial Suggestions to Take Before You Splurge
Posted By: Kara Masterson on December 20, 2018 |
Congratulations, you've landed your first job and just received your first paycheck! It may be tempting to start spending that money right away on fun items after your basic needs are covered, but there are other, more practical things you should do with it too. All five of the following suggestions are good financial decisions to make now that you've started pulling in a regular paycheck.
Save For Emergencies
You can never know what emergencies might occur in the future. You may get hurt and need to pay for medical expenses. Your car could be damaged and you may need to pay for repairs. Unexpected expenses are a part of life. Always put aside some money in a savings account to cover emergencies when they occur.
Save For Retirement
You should start saving for retirement as soon as possible. It seems pretty far away when you are young but the earlier you begin putting money away, the better off you will be financially when you get older. Getting started early could also potentially mean that you can retire early too. Take advantage of any retirement savings programs offered by your employer and look into opening a Roth IRA account.
Buy A House
Buying a house can be a very good way to spend your money. You can own a space of your own and be paying towards something as opposed to pouring money into rent payments. If you move, you can keep that property rented or sell it and earn equity.
Having history as a home-owner will come in handy once you are ready to settle down. Of course, buying a house is a significant investment you should be sure you're ready to make before you make it. Be sure to obtain the aid of real estate agents when buying a house for the first time so you can successfully navigate the legal aspects of purchasing a property.
Investing your money instead of spending it can be an excellent decision. Be sure to adhere to basic investment principles such as diversifying your portfolio and understanding your risk tolerance. If you invest your money correctly, you can make some decent earnings for short- and long-term use, including saving for a new car, retirement or even more expensive wants.
Pay Off Debts
If you are like most students who have just graduated from school you have some debts to pay. Paying those off as soon as possible means you will ultimately pay less in interest on the loan. Doing so will also build, increase or repair your credit score.
Consider all of these suggestions before putting your money towards random buys. A bonus can slip through your fingers faster than you may think. Create a game plan. Once you've gotten some of these more practical things out of the way, then you can start splurging on fun things with the leftover money. You'll thank yourself in the long run. You may even want to divide it between play money and investment money. Whatever you choose, do it consciously.
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