Life in your twenties will come with a whole host of firsts. Your first job, your first apartment living away from your parents, as well as getting your first regular paycheck. You may have had a small weekend job before now, but we’re talking proper full-time paycheck coming in each week or month. With that comes a lot of decisions, though. It can be tempting to spend your money as soon as it comes in and get some of those things that you have always wanted. However, that is not always the wisest thing to be doing. If you want a financially smart future, then there is no time like the present to spend your money well and invest wisely. Here are some of the things that your regular paycheck should be spent on.
Pay Off Student Debt
There is no denying that you are going to come away from college with some debt. For many, it could be a whole heap of money to pay back. While you are likely to not be in a position to pay it all off at the moment, you can still make a plan to pay off as much as you can each month. Having student debt around your neck can be one of the number one reasons why you won’t be able to get a mortgage. So it makes sense to get that cleared as soon as you can.
Pay For Education and Further Learning
Although you are likely to have graduated and want to be paying off your student debt, you can still look for other ways to progress and learn. When they are online courses, like accredited online Masters degree programs, then it can be considerably less than it would be if you were going to be going to school full-time to learn. So if you want to progress and qualify for something that can get you a higher paycheck in the end, then education can be a wise investment of your money.
Invest in Your Company’s Pension
The company that you work for unless you’re working for a small independent company is likely to have a pension or 401K plan. Now is the time to start investing in it. Don’t wait until you’re middle-aged before you start planning for your future in this way; it can make all of the difference. When you invest, your company does too. So it is basically getting double the amount of money that you have put in, for doing very little. Then you can claim it back at certain points in your life. It is a good way to save to make sure that you’re set up for the future.
Set Yourself a Budget
If you don’t monitor cash flow or keep a budget, then you can be setting yourself up for financial difficulty. There are so many sites and apps out there that you can help you to do it, so it doesn’t have to feel like a daunting process. Then you know exactly what money you have leftover to do what you want with, as well as what you can save. Making regular savings into a savings accounts, as well as into a company pension, can stand you in really good stead. But you won’t know what you can afford to save if you just bury your head in the sand over your finances.
Make Quality Purchases
You may have heard the saying that if you buy cheap, then you buy twice. While this isn’t the case for some things, there are many things that this does apply to. Just make sure that what you are buying are quality pieces that can add value to your life. From a tailored suit for your new job or an interview to doing some experiences that you have never thought of doing before. Money well spent on things like these can be money invested. They don’t have to be big-ticket items, though. Think about smaller items that can be quality purchases as well.
Buy a Used Car
If you’re living in a city, then in many instances, public transport could be more cost efficient than getting a car. But if you are looking to get a car, then getting a second hand one has to be the best option when you’re younger. You don’t have to be tied down to certain repayments each month, and cars quickly lose their value. So they are not a wise investment piece at all. So look for quality, but buy second hand.