When you first get a job, you might be focused on one thing: the paycheck. After all, you have things that you will need to pay for, and it gets hard to pay for those things if you don’t have a job! In addition, you probably have a list of things that have been stacking up, especially if you haven’t been working in the last few months. As the economy becomes more and more uncertain, there are actually a lot of people in your shoes right now, so there’s no reason to feel embarrassed. If you haven’t been working for a while, just focus on the fact that you now have a job, and that’s definitely a good thing!
There are a few things that you need to make sure that you do when you first get into a job to really jump start your financial life again.
First and foremost, you will want to make sure that you enroll in your company’s 401k plan. Now, it might seem silly to think about retirement when you just got into the company, but the truth is that there’s going to come a time where you don’t want to work anymore. A lot of people really dream about being able to kickback and just enjoy the best that their golden years have to offer them. Unfortunately, many more feel that there’s just no reason to really focus on retirement. Either way, you want to make sure that you actually have the choice to take your financial life to higher and higher heights, and you can’t do that without money.
However, that’s not the only reason why you will want to focus on retirement plans at work. Many companies offer their employees a 401k match, which means that for every dollar you put in, your employer will match it with another dollar. That’s pretty powerful stuff at work, and it means that your nest egg actually grows a lot quicker than if you were just hanging around trying to piece together a retirement plan on your own. When you add to it the power of compounding interest, things really start to get interesting. If you’re young, you might think that you don’t need to think about retirement, but this isn’t the case either. The truth is that everyone really needs to start thinking about retirement in one form or another — it just makes sense. If you start when you’re young, you’ll have even more years for your money to make you more money.
From here, you will want to open up a savings account. Even though retirement is a form of savings, the truth is that there are strict penalties and other issues that are in place if you think about withdrawing from your retirement account. It’s a lot smarter to build a separate savings account that’s a bit more liquid. This will mean that you won’t have penalties waiting for you if you draw from the savings because of emergencies in your financial life.
Finally, the last thing that you will want to do when you get a job is to sit down and really create a budget. You don’t want to create a budget based on overtime — that’s just asking for that budget to fail, and leave you in a world of hurt. It’s a lot easier to actually look at the real money that you are coming home with in order to build a budge that will actually last.
Speaking of real money, it’s very tempting to only look at your net funds. The truth is that this is short sighted and will only cause problems down the road. You will really need to focus more on the actual money that you get to take home — aka your take home pay.
Overall, these are the three things you will need to do when you first get a job. As you move from job to job, it’s recommended that you revisit this guide and take these steps all over again — though some will have to be modified. Remember, you do have the power to change your own life — get out there and get started today!