Just Started Working? Here's What You Can Do With Your First Salary
Just landed your first job? Congratulations to you and a warm welcome to the world of adulting!
From tests to gruelling interviews to impatiently waiting to hear the results, I’m sure you’ve been on quite the journey to land your first job.
Trust me when I say that it’s just the beginning - a lot of interesting experiences are coming your way!
Of course, one of the key highs, especially of your first job, is the joy of receiving your first salary. Hearing your phone vibrate on receiving the message that your salary has been credited is such a one-of-a-kind feeling!
It finally gives you that sweet taste of independence you’ve been waiting for and the freedom to make your own financial choices.
Not be too boring, but it has to be said - with freedom comes increased responsibility. Managing your finances smartly from the onset can help you slowly build your financial well-being.
The concept of Financial Independence, Retire Early (FIRE) is on the upswing amongst youngsters in India. Many people in their 20s are choosing to live simpler lives while saving and investing money to ensure that they can retire early. They want to focus on spending their 30s and 40s doing something that they’re passionate about instead of worrying about their finances.
And you have that golden opportunity to take your first steps towards building your savings and learn the tricks of the trade. I guarantee you, that your future self will definitely thank you for making this choice!
So here are some ideas on what can you do with your first few salaries:
1. Treat Yourself & Buy Something Special for a Loved One
You’ve earned it, and your loved ones who supported you have too! Your first salary is super special and making it memorable is always a good idea. Whether it’s a fun adventure you’ve wanted to go on or a pair of expensive shoes you wanted to buy, go out and do it guilt-free! And while you’re at it, don’t forget to buy a special gift for your loved ones who’ve supported you through college and will continue to through your career.
2. Clear off All Your Dues
Remember the money you borrowed from a friend for multiple lunches? Or any unpaid phone bills? Well, now is the time to pay it all off and start out with a fresh slate. As you go on this financial journey, you’ll know that a debt-free life means a stress-free life :)
3. Save a Little and Create a Savings Plan for the Coming Few Months
If you start saving a little from your first few salaries it will go a long way. It’s never about how much money you save but about the discipline of actually saving consistently. So take it as a challenge from the very start of your career to set aside a percentage of your salary towards savings and gradually it’ll become a lifelong habit.
Another thing you could do from the beginning of your career is to write down some key goals you want to fulfill. Whether it’s traveling internationally or a gadget you’ve been eyeing or even a passion project you want to undertake, having a goal in place will keep you inspired.
You can get started by taking up a Saving Plan on saving apps like Wizely where you can save little by little every day towards your goals.
Month on month as you start saving up towards these goals and watching them become realities, it’ll keep you motivated to hustle towards making your aspirations come to life. Remember, to make these goals measurable, write them down, and review them from time to time.
4. Keep Yourself Informed on How You Can Invest Your Salary
Now that you have some money saved, you eventually need to start investing it rather than just depositing it into a Savings Account. To begin with, you can learn more about the various investment options that are available to you. It’s always a good idea to have conversations with people who have knowledge of investments and can share some personal examples with you. There are also free resources on youtube and plenty of articles on the subject too.
Depending on whether you want to invest in the short-term, medium-term and long-term, there are different financial instruments available to you. If you want to create an emergency fund from the beginning, then you can look at Fixed Deposit or Auto sweep-in saving accounts. For short-term and medium-term savings you have Recurring deposits and Debt Mutual Funds.
Also, amidst all the various financial investment options you have, don’t miss out on investing in yourself - whether you want to attend a conference, improve your communication skills or upskill yourself, research for those courses and events, and put your money there. This will go a long way in terms of helping you in your career and your financial well-being.
So that was a quick round-up of a few things you can do with your first salary. Remember that you are just getting started on your financial journey and there will ups and downs on the way. The key is to make informed financial choices that ultimately help you reach your financial goals. And most importantly, don’t forget to have fun along the way :)