Have you just graduated from college or university, landed your first job, and are waiting for your first pay cheque? Congratulations! Now what? If you have not thought about what comes next in your financial life, you may fall into bad habits with your money, or continue bad habits you already have.
Why should you strive to develop good money habits? By handling money better, you can focus more on the things in life that matter most. If you don’t handle your money well, you risk increased stress and anxiety over money. The more debt you carry, the less you will feel in control of your own life. Having good money habits is liberating.
I had bad habits and made mistakes with money when I was younger. I received good advice along the way, but a road map would have helped. I would like to share what I think are good steps to get you started. I’ll explore each of these steps in coming posts.
The Road-Map for Getting Started with Money & Finances
- Open an appropriate bank account, and understand the fees involved.
- Resist buying shiny new toys. Strike a balance between savings and consumption.
- Resist taking on more debt.
- Establish a plan to pay down remaining debt, like that student MasterCard.
- Establish a plan for building an emergency or rainy day fund.
- Consider taking advantage of any plans and benefits at your new job.
- Establish an investment plan to build long-term savings.
- Contemplate future purchases and commitments: a car? rent? a house?
- Start paying attention to financial things: open bills when they arrive, read the news, ask questions.