When you start earning your first wage after college, knowing how to get the best out of your money can be tough! These days, you can do your banking easily on your phone, but actually managing that money is a much harder trick. Here’s a few tips that might help.
1. SET UP AUTOMATIC TRANSFER TO SAVINGS
When you have a rough idea of how much you can save regularly, set up a recurring transfer from your current account to a savings account. By making savings automatic, you’ll get used to spending without that small amount going to savings, and you don’t need to worry about remembering to transfer every month.
2. ESTABLISH CREDIT
Student loans and credit cards can help you build a good credit score — as long as you keep up with monthly payments and don’t overuse your cards. Your credit score, which shows how responsible you are with credit, is an important factor that lenders check before approving loans and mortgages. The better your score, the more likely you are to be considered for credit in the future.
3. AVOID OVERDRAWING YOUR ACCOUNT
Before going out on that big night out, take a look at your account’s available balance. This can prevent you from spending more than you have in your account. If you overdraw, you may be charged a fee by your bank.
4. REPAY DEBTS STRATEGICALLY
If you have debts from credit cards or loans, firstly make sure you pay the minimum on each, and then prioritise more if you can to your higher-interest debts. You can reduce how much interest you’re paying faster this way than by treating all debts the same.
5. SET LONG-TERM SAVINGS GOALS
When you start saving early, you take advantage of compounded returns to make more money, so no matter how little it’s always good to start saving early. Start a pension with your employer, or on your own, the earlier you start the more you’ll have when it’s time to retire!
From smart budgeting to setting goals, make good money choices now. Since time is on your side, you can benefit from building credit and saving early to be ready for big financial decisions in the future.