Money is one of the essential parts of life, without money it is difficult to survive. Early in our career, most of us don’t plan our finances. But remember this; the early bird gets the worm, and the early saver, gets a comfortable financial life.
It is not important that your salary is high or low but everyone should focus on at least small investments as soon as they start with their jobs. Salary credit is not only news of a cash inflow, but it also puts a certain degree of responsibility on you. You need to make your money work hard so that you can gradually generate wealth for your future.
Keeping your money into your savings account is not going to work at all. You need to plan for your future.
Clear off your Debts
You are earning and its your responsibility to pay off your debts. Also, don’t forget to pay your debts like credit card bills and other bill payments. They are required to be paid off on a monthly basis and you might end up in trouble if you don’t pay them off. You should calculate your monthly repayments for all debts and set aside money every month to ensure no defaults on payments.
Have an emergency Fund
You need to save money since future is uncertain and unpredictable. Emergency saving will come to your rescue when your boss fires you form the job or any unwanted things happen. Matters can be as small as replacing a mobile phone and as big as urgent medical treatment. An emergency fund keeps you well equipped for all situations.
Ensure you have Insurance
You absolutely need to think about your physical well-being, because it is the biggest asset you have. A health insurance is like a safety kit that you carry with yourself and no, you don’t have to pay a large premium. You need to protect your family and your loved one’s by having a term life insurance. So, if anything happens to you, your family is safe. To cover risk to a certain extent, you should consider purchasing proper health and life insurance policies.
Stop thoughtfully
We are always advised not to buy on impulse. Well, this advice sounds very good in theory. What should you do when you see an item you wanted being displayed on sale? Do you buy it, even if you had not planned for it? These are some of the issues you might be dealing with on a day-to-day basis. However, as a cardinal rule on how to spend your salary, you should avoid impulse buying at all costs. Before you buy something, think about it. Think about how that one purchase will affect you in the future.
Start Investing now
You probably are tired of hearing this, but start investing as early as possible. Investing has the power of compound effect, i.e., to earn income not only on the initial investment but also on the income of earlier years. Investing early increases the time span of the investment, which helps to ride the ups and downs of the financial market. Invest in such a way that the amount invested is diversified and reduces the risk.
Outings
Take a break once or twice a year from your hectic routine and plan a trip with your family and friends. Think of vacations as an investment to increase the size and value of that asset. A vacation is an opportunity to expand your horizons by travelling to new places, signing up for new experiences and creating memories that sustain you.
Stop impressing People
The average person spends far too much money merely trying to maintain an image. I do not mean that you should not aspire to buy fine things in life. What am basically saying is do it for you, not because you need to impress other people.
Pay yourself First
The idea of paying yourself first is at the heart of the ways on how to spend your salary wisely. Don’t forget yourself, spend money on yourself smartly. Keep a small part of your salary on keeping yourself fit.
