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The Ultimate Guide to Manage Your First Pay check Right

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!

Featured photo credit: Earn Real Money via lifehack.org

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Last Updated on January 14, 2019

The Key to Finding Job Satisfaction and Having a Successful Career

The Key to Finding Job Satisfaction and Having a Successful Career

Regardless of whether you hold an entry-level administration role or regularly travel to the ends of the Earth as a hot-shot senior executive, you can still find yourself harboring an emptiness… a feeling that something is missing. A popular assumption that experiencing job satisfaction and a successful career should be underpinned by a well-rounded suite of tangible benefits, no longer holds true for many of us.

We’d never deny health care benefits, appropriate and fair remuneration, bonuses and travel perks in a job package. However, even if served to us on a silver platter, those features can only satiate us to a certain point.

You might wonder what governs entrepreneurs and start-up business owners to quit their lucrative jobs, essentially look the gift horse in the mouth and kiss such benefits goodbye! There can be an irresistible pull to mastermind a business with products and/or services that serve the greater good of community wider than that constituting their daily existence.

Even with research showing entrepreneurship to pose greater threats to their mental and physical health, this unique breed of individuals choose to go against the grain in chasing their dreams of being their own boss. Why? Why would anyone risk this type of career suicide?

Whether you’re an employee, have recently taken the leap to being a business owner or been in business for a while, the commonality is a congenital condition we all share as human beings; to feel a sense of purpose, value and contribution to our community. Despite it being harder to find this for ourselves in today’s world, these approaches will help you achieve ultimate satisfaction through the twists, turns and joyrides that are essential features of shaping a successful career.

1. Search for Opportunities That Feed Your Passion, Not Temporary Excitement

Even though well-intended, the ‘feel good now’ compass that career coaches and consultants often recommend you use to create career satisfaction can actually do you more harm than good. Excitement is transient. It doesn’t last. Passion is the compass you need.

Passion and excitement are two different things. The resounding career legacy that still draws you to turn up on the job regardless of the sunshine or storm that awaits you…that’s passion. It’s like a mental and/or emotional itch you can’t shrug off. Staying attuned to that calling will breed success for you sooner or later. Patience is key.

You’re also likely to have more than one key passion. Beware of getting caught in the notion you have to find your one true purpose. In fact, run immediately from any coach who tells you there is only one. There isn’t.

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Your passion is a journey that can take multiple forms so forget thinking there is the single dream job out there that will give you satisfaction in every way you can imagine. It simply doesn’t exist.

Consider embracing different roles and projects to help you fuel your passion or fuel your pursuits in finding it. Job satisfaction and your career success will be all the more sweeter from a wider range of enriching experiences.

2. Don’t Position Job and Career Satisfaction Assessments as Pivotal Guides to Your Success

Despite their popular use for vocational guidance, assessment tools such as Gallup’s Clifton Strengths and the Myers Briggs Type Indicator have come under fire[1] as being limited to the amount of true value and direction they can offer partakers.[2] These and many other guidance assessment tools (e.g. VIA Character Strengths , DISC ) are self-report questionnaires that don’t have normative population data against which to compare your results.

Simply remember these tools help you develop a stronger sense of what you identify as strengths and weaknesses within yourself, not in comparison with other people. They will still add insight around what sorts of career opportunities, tasks and projects are going to light your fire, what ones are going to extinguish it and what will prod and keep the coals steadily smoldering.

3. Be Clear on Your Personal Values, Ethics and Principles and Choose Relationships That Support You Honoring Them

Teamwork, collaboration, open communication and trust are commonplace for any flourishing work environment. However, whether or not your personal values can be honored in your work can make or break your job satisfaction.

How committed do you want to be to an organization that expects an average of 10 unpaid overtime hours every week under the guise of ‘reasonable overtime’? Are you willing to accept their construing this expectation as ‘strong commitment’ at the expense of your partner and children waiting at home for you? What are your boundaries concerning when you clock on to their time and when you clock off to yours?

Being very in tune with what your personal values, principles and ethics are will bid you well in the job satisfaction stakes. Spending time to reflect on experiences and working relationships you’ve had – the good, the bad and the ugly – will help you make well-informed searches and grounded decisions that will propel your career success.

Finding and nurturing relationships with associates and colleagues who share similar values doesn’t just make your day-to-day pursuits more enjoyable. You become fortunate to work with like-minded people who will support, understand and appreciate you like a second family.

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Being able to honor your personal values in your work means you will still be able to sleep at night when you have to tread where others fear to, and make extremely difficult decisions others would never ever dream of having to make as you forge success in your career.

4. Be Clear on Your Own Definition of What Having a Successful Career Means for You

It’s tempting to get caught up in the ideals and projections of success expressed by those we love, admire and respect. Underneath, we all want on some level to belong to a successful club of some sort.

With research reporting how much money we feel we need to be truly happy,[3] many of us try to subscribe to the notion that having the car of our dreams or taking a European holiday annually will not bring us happiness. The truth, however, for many of us is these tangible rewards are congratulatory reminders of our persistent efforts to chase our career pursuits.

If those are things you aspire to, don’t let anyone steal your desire and want to feel deserving of these things, that those are some parameters by which you define your career success.

Despite consistently being the top revenue earner for two years running, you may not wish to become the sales manager. You may not wish to step out into running your own business even though you consistently excel as an employee, delighting clients and repeatedly receiving glowing testimonials.

Your definition of career success might be enjoying the predictability of a regular workplace routine. You get to leave – without feeling guilty – at the same time each day, love the people you work with and get to spend a good, uninterrupted amount of work-stress free quality time with your family. That picture is also blissful job satisfaction and complete career success.

5. Identify the Sorts of Challenges and Problems You Want to Learn to Overcome

Standard advice you might receive from a career coach might be to look for opportunities where you get to capitalize on exercising your strengths and career-related activities you enjoy.

However, to become a success at anything involves improvement. To excel at anything often involves stepping outside boundaries and comfort zones where others wouldn’t. This means dedicating focus and attention to things you’re not so good at and things you don’t like.

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Here’s where working with a coach can be particularly helpful. Map out the experiences that were unsavory in your working history. Were there challenges you opted out of, projects you failed at or toxic relationships that blasted your sense of purpose and self-worth into oblivion? It’s within these experiences that you might just find the most valuable lessons and guiding lights for your trajectory to achieve greater job satisfaction.

If your natural leadership style is to be a collaborator, finding opportunities that require you to apply a more dictatorial style might be needed. Discussing a secondment or short-term project where you get to develop and test your skills can be a step further in earning contention to lead a larger project down the track.

With several of the company’s boldest personality types penciled to roll out the operation, you’ll not only develop skills that earn your right to throw your hat in the ring; those key players have an opportunity to see your competence. You can then work on building relationships with those stakeholders before you need to hit the ground running should you win the lead.

Greater job satisfaction comes with planning and choosing the lessons and opportunities you want to learn, not desperately flailing, floundering and hoping for the best.

6. Keep Reviewing Your Goal Posts and Be Amenable to Change

The word ‘career’ is indicative of a longer-term pathway of change, growth and development. The journey is dynamic.

You will accumulate new skills and let those you no longer need, become rusty. Your intrigue will be stimulated by new experiences, knowledge and people you meet. Your thinking will continue to expand, not shrink. As a result, your goalposts are likely to change.

A major part of enjoying a successful career is not just setting goals effectively, but regularly reviewing and readjusting them where necessary. However, moving the posts or the target still needs to take place by applying the same processes by which you originally created them. The strength of your emotional connection to those revised goals needs to be the same, if not stronger.

By asking yourself the following questions, you can assure your developmental and growth trajectory is still on course:

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  • Would working toward these goals still allow me to honor my personal values, principles and ethics at the same capacity if not greater?
  • Do the activities I need to undertake to meet these goals honor my highest priorities?
  • Does this feel right for me and those who are nearest and dearest to me?
  • Is this aligned with my passion?
  • Is chasing this goal a right step for me to take now or is this a detour or distraction which could delay my greater plan?

Each of your career goals should have different review periods. Whatever you do, stick to the review schedule you set. It will not only keep you focused but help you see your progress (or lack thereof) and allow you to timely re-chart your course before you get too far down the track. You don’t want to waste time haphazardly heading in the wrong direction.

7. Be Prepared to Let Go

It can be unfathomable to us as to why others risk leaping into the unknown when everything truly appears fine and dandy in the career realm. The company provided stability, recognition, financial success, interesting projects and the promise of a promotion…what was wrong? Why now jump sideways to run a café or train in another field altogether?

Nothing may have been wrong at all. It was all going right. It was just the end of a chapter. Perhaps the yearning for the next step is actually taking a different trajectory entirely. You may want to simply experience a different rhythm. Perhaps it’s time to pursue a different passion.

If you have leaped from employee-land to freelancing or have made the reverse-jump (or you know someone who has), you will have quickly grown a different appreciation for pros and cons each work lifestyle brings. Working for yourself can bring the greater realization of your creativity, whether or not it can be monetized to earn you a living.

When your customers are buying you or a product you designed and fashioned, there is a direct level of appreciation and gratitude that can elevate your confidence in the way you have never experienced as an employee, regardless of your rank.

Similarly, there are times where we need to recognize our business ventures were adventures, not long-term life-changing empires. There are times we need to recognize that time is what provides the clearest limitation of how long we persist for in such pursuits.

We have to recognize the absence of enough financial, mental, emotional and physical breadcrumbs that tells us we’re no longer meant to push in that direction. At least, not for the present time.

The Bottom Line

Above all, keep the momentum. As long as you remain committed to pursuing work opportunities that allow you to honor your highest priorities, the truth of who you are and what you stand for, achieving ultimate job satisfaction and a successful career will never be too far away.

More Resources to Help Advance Your Career

Featured photo credit: Csaba Balazs via unsplash.com

Reference

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