Read These 4 Tips before Spending Your First Pay Check
Firsts usually come with a good dose of excitement. From first real job after graduation, first day at work, to the first paycheck.
This is the point you feel like an adult, no longer relying on handouts from your parents and relatives or having to be accountable to them for your spending. At this point it easy to just rush off and pay for that fancy designer bag or shoes you’ve been keeping an eye on forever, waiting for the day you’ll be able to afford it. Well, before you start splurging on expensive attires, gadgets or hangouts, take a breath and do these few things.
Remember the financial goals you set at the beginning of the year? Well, it’s time to work the talk and be even more responsible with your finances. Setting off on a good financial foundation is the surest way to begin the journey to your financial success. Read up!
Revisit your financial plan or set up a fresh one if you don’t have any
Don’t rush off spending on anything without a plan. If you already have a plan outlined, now is the time to set it in motion. This basically involves creating a budget to cover for your daily living expenses, a savings plan, a financial target of how much you want to save in a year and how much you will need to set aside monthly to achieve this target.
Note down how much your monthly income is and plan your budget accordingly. Your budget should cover all your bills and fixed expenses. Allocate a particular amount for all your monthly expenses.
Set up your emergency funds account
Don’t spend blindly because the money is available. Start an emergency savings plan you can fall back on if life throws you a curveball. This comes in very handy when you must spend on big-ticket items you never planned for but can’t do without. It is better to dip into your emergency funds to resolve a crisis than run into debts.
It easy to set up an emergency savings account. Place an instruction on your salary account to automatically move a certain amount of money to the savings account on a certain day/date continuously for a period of time. Every bank in Nigeria operates this system.
Create a plan for your big spends
As a starter, it is not advisable to embark on big-ticket purchases without a plan. Say you need to buy a washing machine so you can convert the time you spend in doing laundry to doing more productive career-related activities. Rather than take a large chunk of your salary to pay for it all at once, span the purchase into a period of 2 or 3 months depending on the cost. Pay in installments or save a percentage of your salary monthly for it until you realize the actual cost. This way, you don’t run bankrupt before the next payday.
You deserve a treat
Finally, you deserve to give yourself a special treat with your hard earned money or don’t you? Bottom line is, be wise about it. Take yourself out, buy a complete set of corporate work wear for yourself, or do anything special that can serve as an unforgettable memory.