percent and spend less on wants, but you definitely don’t want more to go towards the needs. If you are spending more than half of your paycheck on rent and bills, there is a serious problem which needs to be addressed. Cutting down expenses then re-evaluating will help you understand how to change the outflow of income until you can level up.
As a new graduate it’s easy to get sucked into the reality of spending; Vacation, parties, shopping, etc. Even when you reach your magic number, this doesn’t mean you can ‘Ball until You Fall.” Just because you have the money, doesn’t mean you should spend it. Avoid developing the ‘It’s my money and I’ll spend it how I want” attitude. Prioritize saving and be sure you
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Staying on a budget and not living above your means will also keep your stress level down until you are able to move up the corporate ladder. One rule of thumb to follow is the 50/30/20 rule. No more than 50 percent of your net income should go towards your NEEDS, no more than 30 percent towards WANTS, and be sure to SAVE at least 20 percent. You can always save more than 20
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job?’ There are many websites like ADP.com which will help you determine your net income, by allowing you to enter a gross salary and deductions. You can estimate your take home pay so you aren’t blindsided when you receive the first paycheck.
are investing in your retirement and have an emergency savings of at least six months of expenses. You don’t have to give up 50 percent of your pay, but it is always wise to start investing in your retirement sooner than later. For some it may be easier to save in a separate bank other than where you have your checking. Try not to transfer from savings to checking. Be sure you have a realistic budget, as learning to sacrifice is important. The first few years after college is a learning process. Remember, there are no mistakes only lessons learned. Knowledge will take you a long way in this world and being equipped to properly handle your finances is key. Remember to enjoy the little things while being smart about your budget.
For more money management advice, visit angelradcliffe.com.