Life Packs

Starting Out

First job, new city? Start here to make the most out of your first paycheck.

Made for anyone who:

  • Is starting their first job or is early in their career
  • Is establishing themselves financially for the first time
  • Needs guidance on budgeting, savings, and debt repayment.

Introduction

Starting out can be scary. Whether you’re just starting out your career post graduation, starting out in a new city, or starting out in a new job, we’ve compiled resources that will help you through the transition.

For the recent grads: Perhaps this is the first time you’ve been truly responsible for your finances 100%. Let’s help you develop a budget including those upcoming student loan payments, and make sure you’re spending at a level that will set you up for financial success. We’ll also make sure you’ve got an emergency fund set aside, because maybe mom and dad aren’t going to step in now that you’re on your own. Don’t worry, you’ve got us here too.

For those clocking in to a new job: There are a lot of things you’ll need to consider when making your elections for your new employee benefits. We’ve got you covered.

For those putting a stake somewhere new: There may be a lot of new things to consider if you’re starting work in a new city, or maybe you’re not sure about the tax law in your new state. Is there anything you need to be aware of? We’ll walk you through what you need to know!

Establishing Your Finances

Establishing a plan for your finances is the foundation of your financial success. Probably the most important piece of your plan is the dreaded B-word. Yup, your budget. Unlike the enemy dressed as a friend that is a piece of chocolate cake, a budget is actually your BFF. It will help you save towards goals, pay down debt, and prevent accumulating debt in the future.

The fact is only 32% of Americans maintain a formal household budget, and 31% of Americans have less than $500 saved to cover emergencies!

We want to help you start your plan early! The steps outlined here will help you establish a plan and avoid common financial mistakes that can take years to remedy.

Create a Budget

Creating a budget is the first vital step to establishing a plan for your finances. This will help you determine some key numbers:

  • How much money do you need each month to cover expenses?
  • How much extra is leftover?
  • How much are you saving (as a percentage of your gross income)?

This is a great opportunity to identify where you are spending money that you don't need to. Although we don't advocate for meticulously categorizing every expense, oftentimes you may identify some low hanging fruit such as unused gym or media memberships.

Create an Emergency Fund

Once you've got a handle on your budget, the highest priority is establishing an Emergency Fund for any unexpected expenses life may throw at you. This type of savings is most appropriately held in cash to make sure the funds are available when you need them. A high yield savings account can help you earn a little extra yield on your emergency savings, and you should utilize automatic transfers to build up this fund and avoid overspending.

Set-up Savings Buckets

You will also have other pre-retirement goals like buying a home, getting married or having a baby. These goals have different time horizons and it may be appropriate to invest these savings in the markets to try to earn a little bit more yield. However, all investing comes with risks so you'll want to make sure you understand the risk of your investments before you start. Basic investment guidelines include diversifying your risk and minimizing your investment costs where you can.

Retirement

Everyone should have retirement savings. Set a goal of working towards saving approximately 20% of your gross income towards retirement in an effort to maintain your standard of living after you've retired. For tax efficiency you should prioritize contributions to employer-sponsored retirement plans (i.e. 401k) or IRA accounts (subject to income limitations).

Where Do I Keep My Money?

Seems like a silly question, but there are a few options for where to stash your cash. Figure out which is best for each of your goals.

Protect Your Savings

You’re doing such a great job at saving, don’t throw it away by not protecting your money. Make sure you have insurance in place. Health insurance to cover medical expenses, auto insurance for your car, and renters or homeowners for your possessions.

Establish savings goals, start saving and investing, and track your progress. It's as simple as that!

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