I Have My First Job! Now What?
Create a Savings Plan!
By: Theresa Oliver
Yeah! You got your first job! Now, your next more should be to open a savings account. After having money finally coming in after waiting for so long, it's so easy to want to spend it, especially if you are still living at home. A well-known financial adviser once said that when you receive a paycheck, you should always first pay yourself before paying anyone else. Now, I'm not talking about saving every dime that you make. Heavens no! That's just not practical. But a good rule of thumb is to save at least ten percent of your paycheck ... every paycheck. Here is the short list of ways you can save:
· Savings Account: These have low interest, but is a positive return on your money.
· Money Market Certificates: Once you save at least $500, then invest in a CD or a Money Market Certificate. These have a bigger return on your money
· IRA: Even young people just starting out should have an IRA. This is a great way to save for retirement and for your future. With an IRA, a certain amount is taken out of each paycheck and placed into the IRA, and if you don't see it, you don't miss it.
· Investments: Do this with care! Learn about stocks first before purchasing. Buying stock can be risky, but can also be a good investment. Invest your money with care, not in just any fly-by-night scheme. Make sure that what you are investing in is a valid company.
Again, this is just the short list. There are other ways to invest and save your money, too. But the best thing to do when thinking of saving money is to create a plan. What do you want for the future? What things would you like to do? Would you like to travel? If so, where? What do you see yourself doing after retirement? These are questions that people of all ages should be asking themselves. Once you have the answers, then make a plan of how to get there. The number one thing is: saving your money in order to be able to do these things. Here is a list of things you should consider when making a savings plan:
· How much am I going to save out of every paycheck? How much am I going to pay myself? Again, ten percent of your income is best.
· How am I going to save it so that it is safe and I am not tempted to touch it?
· When will I allow myself to take money out of my account? Example would be emergencies or when there is enough money saved to achieve your goal. But then continue to save!
· How will I plan on replacing the money that I take out?
Well, congratulations on your first job, but don't forget to save! Again, pay yourself first before paying anyone else. After all, aren't you worth it?