Girl, we have all been there. When you earn your first paycheck, you’re on cloud nine. Landing your first job and getting your first paycheck is exciting. You finally earn money on your own, and with hard work alone, you might waste your money or get into a lot of debt. Many first-time salary earners struggle to get their finances in order. They find it hard to pay bills, balance their lifestyle, and save or invest, and that is what I am here for. I am going to share my best and simplest tips you can use to save and invest your money.

UNDERSTAND YOUR INCOME

Before you start spending, you need to understand your income. Not all the money you earn is yours to keep. Your paycheck is divided into:

– Gross Income: The total amount before taxes.

– Net Income: What actually hits your bank account.

– Deductions: Taxes, pension contributions, insurance, etc.

Write down your net income and analyse your paycheck so you know the real figures you’re working with.

CREATE A SIMPLE BUDGET

Budgeting can be one of the most tedious tasks, but it is so worth it. It helps you track your money and see what you are spending it on. Budgeting doesn’t mean restricting yourself; it’s about tracking your money and giving it purpose. I recommend you use the simple 50/30/20 rule:

– 50% → Needs (rent, food, bills)

– 30% → Wants (entertainment, shopping)

– 20% → Savings/Investments

You can use Excel or budget apps to keep track.

CREATE AN EMERGENCY FUND

I hate to break it to you, girl, but life happens, and you need to be prepared. Aim for 3-6 months’ expenses. Start small and regularly increase it. Keep it in a high-yield savings account for easy access.

START SAVING EARLY

The thing about saving is that compound interest is your best friend. The earlier you start, the better it will be, and it also allows you to make big purchases without feeling guilty. Start small and aim higher as you go.

START INVESTING

Investing can be quite tricky, but with the help of a few YouTube videos, you can find out where to start. It is one of the main ways to generate passive income. You don’t need millions to start investing. Begin with what you have and grow from there. Invest in stocks, ETFs, index funds, 401(k)s, and ISAs. Research and look for a good platform that is beginner-friendly and easy to use.

LIVE BELOW YOUR MEANS       

I know it’s tempting to upgrade your lifestyle, but avoid spending more as you earn more. Unless you can buy that item three times over at that moment, there’s no need to purchase it. I’m not saying don’t spend on yourself; I’m advising not to overspend as you start earning.

Starting early is so beneficial for your future self and the best way to be responsible with money. It’s all about consistency. Don’t expect to be perfect from the start—just keep trying. just keep on trying.