If you are working in your first job, chances are you are not on the biggest of wages. Of course, you might have landed on your feet and be commanding a huge salary, but it is more likely that you are working your way up the ladder right now, learning your job, gaining some experience, and as a result not yet on the biggest of salaries. Now, let’s not get it wrong – having a wage is better than not having one at all! Getting your first wages is a great feeling (in fact, getting paid is always great), it lets you know that your work has been validated, and it is a good feeling knowing that you have earnt your own money. You may have more money than ever before, but that doesn’t always mean it goes very far! A couple of nights out and a spot of shopping can soon eat into your pay-packet, leaving you feeling short before your next pay comes in. Managing your money is a skill that comes with practice, and not everyone masters it.
Getting into good habits early on can make your money work better for you in the long run, so it is worth working on it as soon as possible. With that in mind, here are a few tips to help you get on the right track with your money:
This is basic. How do you know what you have to spend if you don’t know all your outgoings? Make a list of the things you need to spend money on – whether that is rent, travel to work, or even just money for lunch each day. Be honest with yourself on the money you spend regularly. You might be able to save some later (take a packed lunch to work rather than buying one each day?), but for now it is all about knowing where you stand.
Once you have your budget sorted you will be able to assess where your money needs to go. You should always budget for your outgoings first. For example, it may not be as fun to pay your electricity bill as it is to go shopping, you are actually buying something for yourself by paying it – the electricity to watch TV, turn on a light, or even cook. The money for your outgoings should always come first.
Saving money can be tough, especially when you don’t have much coming in. You may feel that you barely have anything left once you have paid all your bills, but avoid the temptation to spend it all right away. You should also try to save some money, regularly. It is best if you get into the habit of doing this sooner rather than later, before you get used to having that extra cash in your pocket each month. Decide how much you feel you can afford to save each month and put it aside. Your savings are an investment in your future and a buffer should something go wrong. The only time you should not save money is if you have debts to pay. If the interest on those debts is higher than the money you stand to get from your savings, then you need to divert your funds to paying what you owe first. Try setting a goal for how much you want to get saved – three times your monthly wage, perhaps?
Sometimes you may feel the urge to buy something you can’t really afford. When you do this you are mortgaging your future wages against the thing you want now. You have to ask yourself if that new top is really worth paying over the odds for. It may sound old-fashioned today, when credit is so easy to come by, but it is always wise to save up for something rather than getting into debt to have it now.
Of course, you should also try to treat yourself each month. A night out around pay-day is a nice way to celebrate your hard work, but be sure to keep an eye on how much you are spending! You might want to set a weekly amount that you can spend on socialising and other treats, like shopping. A lot of people like to go out shopping when they get paid, splurging their cash and treating themselves. There is nothing wrong with doing this, but what if you held off for a few weeks and went just before (or even after) your next payday? That way the money would be in your account for the whole month should you need it for something else – and if you make it through the month you can buy that treat without risking running short before next payday. It may take some real will-power, but you only need to delay that big treat once to get your money in synch with your next pay.
