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When you land your first job, it's important to learn how to manage your income. Now is the perfect time to establish healthy spending and saving habits. Read on for tips to manage your finances with your new paycheck.

Tips for Spending

  • Make a Budget

Creating a monthly budget is one of the easiest steps toward manging your money. Use a spreadsheet or an online budget calculator to record your income and monthly expenses. Estimate how much you'll spend this month, then track what you actually spent at the end of the month.

  • Find Ways to Save on Household Expenses

There are several ways to save money on household expenses, and your budget can help you find where to cut back. To get started, you can cancel streaming subscriptions you don't use often, turn off lights and other appliances when you're not using them, and cook at home instead of eating out.

Tips for Saving

  • Build an Emergency Fund

A great way to get started is by establishing a regular savings habit. Experts suggest saving three to six months of expenses for a financial emergency, but 58% of Americans have less than $1,000 saved. Your emergency fund will help you stay afloat if you lose your job, if your car breaks down, or if you have unexpected medical bills.

  • Open a Retirement Account

Once you have your emergency fund in place, start saving for retirement. Many employers offer a 401(k) match. If you deposit 3% of your income, your company may match it with an additional 3%. Money that you save through a retirement account is tax-free, so opening a 401(k) or IRA is a great way to invest in your future and give you peace of mind. 

Key Takeaway

These tips will help you save money as you begin your journey into the workforce. Once you learn the basics, it's time to talk to an expert. NAIFA's one-of-a-kind Find an Advisor tool makes it easy to find a professional who can help you reach your financial goals. A financial advisor can help you make a plan that focuses on what's most important to you.

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