Everyone is prone to making some mistakes when it comes to money, whether it be not saving enough or spending money a little too freely, we all likely have something that we can work on. Financial health is important to your overall well-being and should be taken seriously. If you feel like you have fallen off-track on your budget or that you are always scraping by or even that you aren’t setting yourself up for financial success, the first place to start is right at the source—your paycheck. Check out these finance basics to help you make the most of your hard-earned money and set yourself up for financial success.
Don’t Spend Your Money Before You Get It
Finding out you’re getting a raise, or a bonus is very exciting news! But you must be careful not to go out and spend your money before you even get it. There is a huge difference between what your bonus or new salary actually is and what you will see on your check—this is due to taxes. If you are getting a $1,000 bonus, you definitely are not going to get a check for $1,000 come payday. Do not get yourself in the habit of spending money that you don’t yet have, otherwise you will find yourself in a cycle that feels impossible to stop.
Check For Mistakes
You should make it a habit to check your paystub for any mistakes. While your employer is not trying to pay you less than you are owed, sometimes accounting mistakes happen, and you could end up with less money than you are actually owed. If you notice an error, contact your employers HR or finance department right away to get things cleared up. Checking out your paystubs is important, especially if you receive direct deposit and aren’t given a physical paystub every time.
Take Advantage of Any Available Benefits
Many employers will offer their employees benefits; one of the most popular is 401K matching. Putting money into your 401K might seem like cutting your own paycheck, but do not worry—it is still your money, and you will get it back. If your employer matches your contributions, take advantage of this as it is like them giving you free money!
Don’t Think in Dollars, Think in Percents
Many times, the exact dollar amount of your expenses will change from week to week or month to month. Therefore, you should be thinking about your money in percents. While you still need to know how much money you have in total, you should be thinking about what percent of your income goes where when it comes to budgeting. You might just find that you are spending a large portion of your money on one thing or another and this will make it easier to rein in your spending.
Think Long-Term
You aren’t going to be working forever, at least hopefully not. It is never too late to start planning for retirement, and the sooner you start, the more successful you will be. Even saving a small piece of your income now for retirement will help you out in the long run. You should also tailor your budget to help you meet longer-term purchases such as a new car or house. Thinking about these things now will make them much more attainable when the time comes.
Your Paycheck, and Yourself, will Thank You
Now that you have identified some ways in which to better manage your income, it’s time to take action and implement some of these ideas. Your future self will thank you big time!
