You have just secured a job and payday is near now you wonder how to plan your first salary, worry not. I have prepared a complete guide to help you understand how to invest your first salary or spend it.
Making money decisions can be complex especially when you plan your first salary. Having been jobless for a period of time and now you are near pay day is both an exciting experience and can be evoke a feeling of confusion.
The big question is what is you plan to do with your first salary? This is how I spend my first salary which can be helpful to you now:
1. Calculate Your Spending
It is important that you fully understand how much money you need for your day to day living expenses.
That means that you should create a list of all expenses such as monthly rent, utility bills, groceries, food, transport to work and insurance.
2. Plan Your Expenses
You should carefully arrange your spending. The transport cost to a trip to the grocery shop or a night out with friends should be included.
Allocate each expenses a specific amount of money you can comfortable spend.
Your debts repayment should be inclusive in your salary. Keep in mind that these debtors came in when you were financially low.
Paying debts on time creates a good rapport and you can obtain better assistance in future if need be.
Have savings to include both future financial goals and emergency funds in different account. Depending on your level of salary, financial goals vary it can be to buy a house, utensils, a car, etc.
Creating a saving habit can go a long way to help you become financially independent.
5. Pay Medical Insurance
Now that you are on a salary means you are an adult. Pay your NHIF payments and other private insurers if you can afford.
Remember, no one plans to be sick and it is these savings that can help you pay medical bills if need be.
6. Stop Impressing People
Getting your first salary should not be a show off like you buy expensive things just to show off, visit expensive place, or simply give away money to relatives or friends just anyhow.
Only put your money where it needs to be. People will always be ready to enjoy free things from you. Let them not plan your salary but it is you to plan for it.
7. Stick To You Budget
Once you get your salary, stick to what you said you will do. Otherwise, you will end up “wasting” your first salary yet accomplish nothing.
Besides, live within your means and avoid debt traps if you can.
8. Pay Yourself
Yes. I mean pay yourself. As part of your budget, set a reasonable amount to pay yourself.
If you like food, clothes, shoes, etc, it feels good to get one of those and enjoy. Besides, you deserve it as you have worked for it. Be sure to stick to your budget when you shop, first salary can be tempting to buy unnecessary things.