After completing school and entering the workforce, you may feel like you have things figured out. If you broke into the tech industry, you are probably feeling pretty good about your salary. Even if you are not earning what you expected, the time after college is often your first experience with a real job, one that comes with paid time off and benefits. It is important to keep a handle on your spending, so your lifestyle doesn’t creep up to meet your earnings. Few things that you should do early in your career to ensure your finances are on the right track.
Consider Refinancing Student Loans
Re-financing student loans is a good way to save money. You can refinance your loans to a lower interest rate, which can lower your monthly payment, the length of your loan, or both. If you have a good job and have been managing your finances responsibly, you will probably be able to refinance your loans at a lower rate than your original loans.
Read Your Benefits Package
This may be the first job you have had that offered benefits. They are part of your compensation package, so not using them is like leaving money on the table. Read through the package and be sure you understand what is offered. Things like health savings accounts and tuition reimbursement may not be explained specifically during the onboarding process, so you need to take the time to read and understand what is available.
Don’t Put Off Saving for Retirement
It tends to be enticing to put off investing in your retirement, or just investing a minimal amount, while you have other priorities for your money. You want to begin investing as early as possible so that your money has time to grow. You should plan on investing at least as much as you need to maximize your company’s employee match. Ideally, you should try to reach your maximum contribution each year, although that may be difficult in your initial years on the job.
Part of having a real job is being responsible for yourself. The best way to be sure you can weather any storm that may crop up is to have a healthy emergency fund. You ideally want six months of living expenses in a savings account that you only touch in case of an emergency. This goal may seem like an overwhelming amount at first. To make it feel less insurmountable, break your goal down. Initially work towards having 1000 dollars in your savings. Then aim for 3 months of living expenses. Finally, work towards 6 months of expenses. Setting up your banking so that a specific percentage automatically transfers to savings on payday is a great way to create a savings habit.
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Build Credit Responsibly
You need credit for everything from buying a house to getting the best auto insurance rates. Building credit requires you to have one or more credit cards and use them responsibly. Be sure to pay them off in full each month to avoid paying interest.