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The Ultimate Guide to Manage Your First Pay check Right

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The Ultimate Guide to Manage Your First Pay check Right

The excitement of your first real job comes with the anticipation of your first real paycheck, in addition to musings about what to do with your hard earned money. However, when it comes down to the payday, nothing can rain on your parade more than receiving a much smaller figure than you were promised. Deductions for health insurance premiums, taxes, and certain other employee related costs can leave a rather inadequate amount to pay for your rent, food, bills, and other necessities. However, if you spare some time for saving and budgeting, you might even be able to pay off your loans and retirement funds down the road, in addition to making ends meet.  While managing your own finances can be a rather daunting task, this feat is absolutely necessary for people with limited means.

Developing a realistic budget based on your expenses and initial salary can foremost ensure that you don’t end up broke and back to your parent’s nest by the end of the month. It can be hard to know what to do with your money when you have never had to deal with an actual budget, so here are a few tips on helping millennials make budget for their first job:

First things first—pay off debt

Auto loan debts, student load debt, credit card debt; sounds familiar? These debts plague the lives of every young worker. Why not leverage your new source of income to roll the ball with repaying your debts, just like your lenders expect you to. This is all the more important because the sky high interest rates can cripple your financial standing in the long run, and make it a challenge to move forward with your career. As a new earner, paying off debts should be high on your list. This doesn’t entail paying off the entire balance, until you are far behind on your payments, but you should factor into your paycheck the fact that you are right on schedule with your payments.

If you are one of those people who get into the habit of paying only the minimum payment for your credit card debt each month, it’s high time to change your ways as soon as possible. Minimum payments can protract your payments out to years, costing thousands of dollars in interest. Make it your utmost priority to pay off your high interest credit card debt first, before it accumulates to insurmountable monstrosity.

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If you have any pending student loans, you generally get 3-6 months after graduation before you are expected to pay. Instead of whiling away your grace period to rest on your laurels, you should plan how to go about your payments before they commence. Factor in the minimum payment in your budget and determine if perhaps you can afford to spare more than the minimum. If so great! You can simply restructure your budget around it.

Set a Budget

If prior to this job you were in in school, chances are your finances were pretty basic and making ends meet was no rocket science. You likely had some preliminary utilities and bills to pay, and your education was probably funded by student loans or any third party source. However, now that you have crossed over to the workforce threshold and all that comes with it, your cash flow needs will undergo a drastic transformation, causing you to rethink how to make the most of your money.

After you determine what portion of your paychecks will be left over after payroll and income taxes, it is time to sit back and jot down your monthly expenses; i.e. your needs and probable wants. How much is your current rent and will you be moving to a nicer place now that you have the extra cash? How much time do you get before you absolutely have to start paying back your student loans, and how much can you afford to pay? Such big expenditures determine where a significant chunk of your money has to go every month.

When working up your budget, it is prudent to start with your fixed monthly bills, including your credit card payments, internet, phone, utilities, car insurance, renters insurance, student loan,  car payment, and your rent. To that, add up your variable work related monthly expenses, including:

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  • Travel

Only a fortunate few get to live within a walking proximity of their workplace; the rest have to travel and traveling requires cash. So unless you cycle to work, you need to add the cost of traveling to your expenditures. If you use public transport, it’s a good decision to purchase a season ticket that lasts an entire year.

  • Clothes

If your job entails special clothing or a uniform, this is generally supplied by the employer. However, considering your personal wardrobe and everyday work clothing, such as smart clothing and suits, you need to buy them yourself. While work clothes can touch the higher end of the price spectrum, you can shop around super markets and the high streets to find reasonable work wear ranges, or even check online stores for great bargains.

  • Food and drink

You’ll need to have lunch at the office everyday so you can decide between taking your own in and buying it there. Eating out regularly can cast a shadow over you finances, but some companies incorporate canteens that offer cheaper meals to employees.

  • Mobile phone

Being away from your family and friends while at work requires you to use your phone every day. Check to see if you are not going overboard with your allowances and also consider switching your phone tariff.

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  • Socializing

This expenditure is the toughest to figure out on your first job since you are not familiar with the social scene of your new workplace. Whether you would need to join a dinner party to be “one of the girls”, or decamp to the wine bar with the entire team for the happy hour every Thursday, how you choose to socialize at work dictates your budgeting decisions.

Next, you need to deduct your monthly expenditures and cash needs from your take-home pay to calculate your discretionary income before deciding what portion of this pay you want to save each month. If the remnant of your salary doesn’t promise much prospects for saving, review your variable expenses, such as entertainment, shopping, and other miscellaneous, to see where you can cut back.

Once you get a hold of monthly savings goal, make sure to automate the transfer of funds into your saving account so that you avoid tapping into your savings every now and then for impulse buys.

Plan for Emergencies

Planning for a saving fund from day one lends you the resources you need to make major purchases down the road, in addition to helping you weather financial storms. A broken cell phone, a car accident, or a layoff can greatly disrupt your income and wreak havoc on your budget. Putting away some petty cash in the sunny days can help you avert using credit cards and get sucked deeper into the swamp on a rainy day.

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To garner a vestige of financial stability, you should ideally try to save the equivalent of up to 3-6 month’s worth of your salary. Once you have met this goal successfully, forget that the money exists. Keep your money isolated by moving it to an account not linked to checking. Going to such rigid measures ensures that you don’t transfer funds with the push of a button for whimsical purchases.

Limit Your Debt

While regularly using a credit card can help you build credit, it is not prudent to make impulse purchases that you can’t pay for right away. If you are already in the throes of a high-interest credit card debt, devote a significant chunk of your cash that you have set aside for savings towards your outstanding balances. While paying off high interest debts should be your utmost priority, do not overlook the necessity of having an emergency fund in place.

The grace period that you are entitled to before you have to start paying back your student loans, is a great time to save as much as you can or even cut some credit card debt. Budgeting your salary from the beginning can avert your paycheck from draining as soon as the bills start pouring in.

Save for Retirement

Sign up as soon as possible if your company offers a 401(k) retirement savings plan. If not, a traditional Individual Retirement Account (IRA) or a ROTH might suit you better. While these contributions come out of your pocket, if you get used to your full pay and delay enrollment, it might be harder for you to allocate money into your retirement funds later. It’s better to start saving early as it helps your investments to grow and bolsters the money that you will make over the years. Even if you find it hard to contribute a lot at the start, consider a minimum to get your employer’s best matching contribution, or perhaps 1 percent contribution, and then build up from there. I wrote this article with help of my childhood friend and co-founder of couponbend.com Vicki James. She is my best friend and we discussed many points before i complete this awesome article.Enjoy reading!

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Featured photo credit: Earn Real Money via lifehack.org

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Last Updated on August 25, 2021

Why Personal Branding Is Important to Your Career

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Why Personal Branding Is Important to Your Career

As a recruiter, I have met and interviewed hundreds of candidates who have no idea who they are.

Without a personal brand, candidates struggle to answer the question: “tell me about yourself—who are you?” They have no idea about who they are, what their strengths are, and how they can add value to the company. They present their CV’s believing that their CV is the key to their career success. In some ways, your CV still has its use. However, in today’s job market, you need more than a CV to stand out in a crowd.

According to Celinne Da Costa:[1]

“Personal brand is essentially your golden ticket to networking with the right people, getting hired for a dream job, or building an influential business.” She believes that “a strong personal brand allows you to stand out in an oversaturated marketplace by exposing desired audiences to your vision, skillset, and personality in a way that is strategically aligned with your career goals.”

A personal brand opens up your world to so many more career opportunities that you would never have been exposed to with just your CV.

What Is Your Personal Brand?

“Personal branding is how you distinctively market your uniqueness.” —Bernard Kelvin Clive

Today, the job market is very competitive and tough. Having a great CV will only let you go so far because everyone has a CV, but no one else has your distinct personal brand! It is your personal brand that differentiates you from everyone else and that is what people buy—you.

Your personal brand is your mark on the world. It is how people you interact with and the world see you. It is your legacy—it is more important than a business brand because your personal brand lasts forever.

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I have coached people who have very successful careers, and they come to me because they have suddenly found that they are not getting the opportunities or having the conversations that would them to their next role. They are having what I call a “career meltdown,” all because they have no personal brand.

A personal brand helps you become conscious of your differences and your uniqueness. It allows you to position yourself in a way that makes you stand out from the pack, especially among other potential job applicants.

Don’t get me wrong, having a great CV and a great LinkedIn profile is important. However, there are a few steps that you have to take to have a CV and LinkedIn profile that is aligned to who you are, the value you offer to the market, and the personal guarantee that you deliver results.

Building your personal brand is about strategically, creatively, and professionally presenting what makes you, you. Knowing who you are and the value you bring to the table enables you to be more informed, agile, and adaptable to the changing dynamic world of work. This is how you can avoid having a series of career meltdowns.

Your Personal Brand Is Essential for Your Career Success

In her article, Why Personal Branding Is More Important Than Ever, Caroline Castrillon outlines key reasons why a personal brand is essential for career success.

According to Castrillon,[2]

“One reason is that it is more popular for recruiters to use social media during the interview process. According to a 2018 CareerBuilder survey, 70% of employers use social media to screen candidates during the hiring process, and 43% of employers use social media to check on current employees.”

The first thing I do as a recruiter when I want to check out a candidate or coaching client is to look them up on LinkedIn or other social media platforms, such as Facebook, Instagram, and Twitter. Your digital footprint is the window that highlights to the world who you are. When you have no control over how you want to be seen, you are making a big mistake because you are leaving it up to someone else to make a judgment for you as to who you are.

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As Jeff Bezos, the founder of Amazon, once said, “Your brand is what people say about you when you are not in the room.”

In her book, Becoming, Michelle Obama writes about the importance of having a personal brand and her journey to defining her personal brand. She wrote that:

“if you don’t get out there and define yourself, you’ll be quickly and inaccurately defined by others.”

When you have a personal brand, you are in control. You know exactly what people will say about you when you leave the room.

The magic of a personal brand is that gives you control over how you want to be seen in the world. Your confidence and self-belief enable you to leverage opportunities and make informed decisions about your career and your future. You no longer experience the frustrations of a career meltdown or being at a crossroads not knowing what to do next with your career or your life. With a personal brand, you have focus, clarity, and a strategy to move forward toward future success.

Creating your personal brand does not happen overnight. It takes a lot of work and self-reflection. You will be expected to step outside of your comfort zone not once, but many times.

The good news is that the more time you spend outside of your comfort zone, the more you will like being there. Being outside of your comfort zone is where you can test the viability of and fine-tune your personal brand.

5 Key Steps to Creating Your Personal Brand

These five steps will help you create a personal brand that will deliver you the results you desire with your career and in life.

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1. Set Your Personal Goals

What is it that you want to do in the next five years? What will your future self be doing in the next five to ten years? What is important to you? If you can answer these questions, then you are on the right path. If not, then you have to start thinking about them.

2. Create Your Unique Value Proposition

Create your unique value proposition by asking yourself these four questions:

  1. What are your personality features? What benefit do you offer people?
  2. Who are you and why do people enjoy working with you?
  3. What do you do and what do people want you to do for them? How do you solve their problems?
  4. What makes you different from others like you?

The answers to these questions will give you the information you need to create your professional story, which is the key step to creating your personal brand.

3. Write Your Professional Story

Knowing who you are, what you want, and the unique value you offer is essential to you creating your professional story. People remember stories. Your personal story incorporates your value proposition and tells people who you are and what makes you unique. This is what people will remember about you.

4. Determine Which Platforms Will Support Your Personal Brand

Decide which social media accounts and online platforms will best represent your brand and allow you to share your voice. In a professional capacity, having a LinkedIn profile and a CV that reflects your brand is key to your positioning in relation to role opportunities. People will be connecting with you because they will like the story you are telling.

5. Become Recognized for Sharing Your Knowledge and Expertise

A great way for you to promote yourself is by sharing knowledge and helping others. This is where you prove you know your stuff and you gain exposure for doing so. You can do this through social media, writing, commenting, video, joining professional groups, networking, etc. Find your own style and uniqueness and use it to attract clients, the opportunities, or the jobs you desire.

The importance of having a personal brand is not going to go away. In fact, it is the only way where you can stand out and be unique in a complex changing world of work. If you don’t have a personal brand, someone will do it for you. If you let this happen, you have no control and you may not like the story they create.

Standing out from others takes time and investment. Most people cannot make the change by themselves, and this is where engaging a personal brand coach is a viable option to consider.

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As a personal brand coach, working with my clients to create their personal brand is my passion. I love the fact that we can work together to create a personal story that defines exactly what people will say when you leave the room.

Other People’s Stories

Listening to other people’s stories is a great way to learn. In his article, 7 TED Talks About Personal Branding, Rafael Dos Santos presents the best Ted Talks where speakers share their stories about the “why,” “what,” and “how” of personal branding.((GuidedPR: 7 TED Talks About Personal Branding))

Take some time out to listen to these speakers sharing their stories and thoughts about personal branding. You will definitely learn so much about how you can start your journey of defining yourself and taking control of your professional and personal life.

Your personal brand, without a doubt, is your secret weapon to your career success. As Michelle Obama said,

“your story is what you have, what you will always have. It is something to own.”

So, go own your story. Go on the journey to create your personal brand that defines who you are, highlights your uniqueness, and the value you offer to the world.

Featured photo credit: Austin Distel via unsplash.com

Reference

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