One of the most exciting things of getting out into the workforce is the salary. Having those dollars rolling into the bank account. Though they might be rolling slowly to start off, as you might enter your job on small figures, you can make it go a long way, if you plan it right.
When I first started working full-time I couldn’t believe how great it was to go from school and university days where I was paying to write my essays for me at a desk all day, to a job where I was still learning at a desk but this time I was getting paid to be there. Not the other way around. It is a really empowering feeling.
However, it can be incredibly tempting to dwindle the hard earned cash away. It never ceases to amaze me how much money us young women can spend on food and clothes. I know, I know, you really want to go out for dumplings and cocktails wearing your new online shopping purchases. And you can. But there needs to be a balance.
As someone who has seen and done it all – from over spending on shopping to learning how to manage a budget and now owning property – I wanted to share what I’ve learnt so far on making the most out of a working income.
Here are my top tips for making your salary last.
Set a BudgetThe first step might sound obvious but it is crucial. You need to know where you stand with your money. The easiest way to manage your spending, is to create a realistic budget. Put aside money for set categories. If you want to keep it simple this could include Savings, Rent, Bills (including groceries), Student Loan and Entertainment. And yes, in that order. I created mine in an Excel sheet, which I keep in my emails so I have easy access to it from anywhere. The key here is to make it realistic and have a balance – don’t stretch yourself too thin but don’t give yourself too much money to spend.
Pay Yourself FirstIf you want to get ahead in life, you’ll need money. That’s a fact. Even if you don’t know what you’re saving for – a house might be a distant goal for you or travels might not even be on the cards for you – if you don’t start saving now, you will simply spend all your money. Get yourself into good habits and put money into your savings each time you get paid. The trick is to do this first. Before you pay for anything else, you need to pay yourself.
Have a Savings GoalFor some this will be obvious. You might have always known that buying a property is the obvious next step for you. For others, you might not feel comfortable with climbing the property ladder and you might just be saving for a rainy day. At the very least, work out how much you can save with each pay packet and then sit back and watch it grow. Build it and build it pay packet by pay packet. There will come a time when you’re ready to make an investment and you’ll be so stoked with past-you that you saved up for future-you. Otherwise is there any point flogging yourself day in and day out at work to turn around and spend every penny? I find money is easy to spend but hard to make.
Treat Yo SelfYou’re young and allowed to have fun. You work hard so you deserve to enjoy it. But the big thing here is to do so from your allocated budget. That’s why I have an ‘Entertainment’ category. When you start dipping into savings so you can get your hair and make up done for a night out, it’s where things are likely to get out of hand.For me, my Entertainment money includes everything from the movies to dinner out, getting my hair cut, clothes and more. It’s pretty much anything that doesn’t fit in the other categories of my budget, mainly materialistic items or outings. Some weeks I might not spend any of it so other weeks I can enjoy more of it.
You need to ask yourself, do you want to be one of those girls who spends everything she earns now to only regret it later? Or do you want to take charge now and come up with a clear plan to manage your money? I chose the latter. I’m not going to lie, I still enjoy my online shopping, the occasional splurge on home-wares, shoes and dinner out with the girls but I don’t feel guilty for it. I set money aside and I stick to my savings plan. It’s really not hard to follow a budget and as a result you can watch the dollars grow. For now anyway.