How to Manage Your First Salary and Grow Your Savings
We often remember the first job, the first friendship, the first love, and we take a lot of care of them, but don’t you get overly excited about your first salary?
Due to the heavy expenditure on studies for many years, you did not get much to spend on yourself, and the hand was often tight.
So first job, first salary. Wow. As soon as the day of getting a salary comes near, you start making plans to spend it. But pay attention.
Your little carelessness can turn the excitement of your first salary into stress. If you also want to make your first salary memorable and beneficial, then follow these things:
Make the Right Strategy
The style of spending the first salary is different for everyone. Some take it and keep it at the feet of their parents; some offer it in the temple; and some spend their entire salary on shopping.
In fact, most people spend their first salary on the basis of emotions rather than a well-thought-out plan.
The difficulty is that many people spend their full salary in the first week of the month with extreme enthusiasm, and after that they have to run their hands here and there to meet the expenses.
Therefore, our advice to those who are going to do the job for the first time is to make a good plan before spending the salary.
Create an Appropriate Budget
You get your salary after one month of doing the job, so by the end of the month it is known how much will be spent on which item.
Get an idea of how much is spent on big items like food and drink, transportation, room rent, mobile recharge, etc.
Similarly, you will get an idea of the expenses for entertainment, loan repayment, shopping for clothes, books, etc.
Prepare a budget for the month, and as soon as you get your salary, first of all, take out a portion for the big items and keep it aside. You can be sure that the salary lasts for the whole month.
EMI and Insurance Are Also Necessary
Try to get a life insurance policy and a health insurance policy as soon as you get your first salary. At a young age, the policy is available at a lower premium, so it is better to get insurance coverage early.
It is considered good to take out a term life insurance policy.
Apart from this, suppose you already have a loan running and you want to pay it regularly.
Then get it linked to your salary account to repay its EMI, or ECS, facility. Under this, money will be automatically deducted every month on the date you specify.
Taxes, Savings, and Investments
Along with the first salary, you should also plan for savings, investment, and tax savings in the future. It is better for investment to make a good portfolio, under which some part of the savings should be invested in the stock market, some in gold, some in property, and some in debt instruments.
Those who are young have a higher appetite for risk, so a higher proportion of their portfolio can be in the form of investments in stocks.
But investing in the stock market is very risky, so you should start with mutual funds. If you invest in ELSS or the Rajiv Gandhi Equity Scheme of any mutual fund, then it will also save you tax.
Be Sure to Keep These Things in Mind
- If your income is fixed, then plan your expenses.
- There is a limit to your salary, so spread your legs as long as the sheet.
- Do not spend your entire salary in the first week of the month; otherwise, there may be trouble.