Maximizing your paycheck requires planning. Understanding what you want your money to do for you and how you can attain your goals determines what you do with your income.
Creating a spending plan, saving for emergencies, and contributing to your company’s retirement plan support financial wellness. Automating your savings and boosting your income help you attain your financial goals.
Create a Spending Plan
A spending plan determines where your paycheck goes and helps your actions match your priorities. You can use a pen and paper, a spreadsheet, or an app to create your plan.
Start by listing your monthly expenses:
- Savings goals
- Debt reduction
- Mortgage or rent
- Groceries
- Utilities
- Health care
- Phone
- Internet
- Entertainment
- Other expenses
When you have a clear picture of your monthly expenses, compare your spending with your income. Then, determine the areas where you can cut your spending. Examples include:
- Purchasing store-brand foods.
- Preparing coffee and meals at home.
- Reducing the number of streaming services.
- Picking up books and DVDs from the library.
Additional spending plan tips include:
- Always pay yourself first.
- Prioritize emergency fund and retirement savings to help avoid going into debt and having to work longer than desired.
- Pay off short-term debts to free up money for long-term debts.
- Monitor your daily spending to stay on track, pay off debt, and reach your savings goals.
Save for Emergencies
An emergency fund covers unexpected expenses without impacting your spending plan or long-term savings strategy. The following is a suggested strategy:
- Open a separate checking, savings, or money market account for emergencies.
- Set aside at least $1,000 to start.
- Work toward saving 3-6 months of expenses.
- Consider securing a temporary job to increase your income and savings.
- Always replenish your emergency fund after using it.
Contribute to Your Company’s Retirement Plan
Begin contributing to your company’s retirement plan as soon as possible to maximize your long-term savings:
- Investing early lets your savings grow over time.
- Compound interest increases the value of your savings.
- Annually increasing your contributions by 1-2% sets aside additional retirement funds.
- An employer match helps reach your savings goals.
Automate Your Savings
Having a set amount transferred from your paycheck to multiple accounts, such as your checking account, emergency fund, and retirement account, helps you adhere to your spending plan and reach your goals. The benefits include:
- Time savings: Once the setup process is complete, no additional work is required.
- Objectivity: Removing emotions from where your money goes helps you adhere to your spending plan.
- Focus: Routing the money to your goals reduces the desire to make impulse purchases that impact your spending plan.
Boost Your Income
Consider taking on a temporary job to boost your income and help reach your goals:
- Many temporary jobs can be worked around your full-time job.
- The limited duration provides flexibility to take on future temporary jobs when desired.
- Additional income helps pay off debt and increase your savings.
- Increased income reduces stress and provides peace of mind.
Find a Temporary Job
Visit our job board today to secure a steady, well-paying role with Cardinal Staffing Services.