Promoted? What You Can Do to Make the Most of Your Money
Promotions and the raises that come with them are usually welcome. They’re acknowledgments of your professional progress. It’s also easy to view them as a path to a cushier lifestyle, but that can prove a financial dead-end. There are things you should do to get the most out of that money.
Get on Top of Those Tax Forms
Tax forms don’t make most people giddy with joy, but updating yours should top your list of things to do after a promotion.
Employers manage withholdings based on the W4 form they have on file for you.
If that promotion comes with a substantial raise, you want the right amount of taxes coming out.
Otherwise, you’ll be in for a nasty time of it when tax season rolls around.
Revisit Your Expenses
Most promotions come with an increased workload. That can mean longer hours, especially right at first, so childcare costs might go up.
It can also require an updated wardrobe for some positions.
Build these expenses into your budget so you can see how much more you’ll actually clear month-to-month.
This is also a great time to look at recurring costs. You can certainly cut out expenses, but also be open to adding some that would be beneficial.
A wealth management service, like those offered at rmrwealth.com, could be a good addition, but we’ll get to investments later on.
Stick with Your Budget
It’s tempting to take that new salary on a spending spree, but you’ll be well advised to stick with your revised budget.
That extra money can fuel your savings, your emergency fund, or build up a down payment on a house.
Shiny new toys feel great in the moment, but they’re pure expenses that provide no substantial value over time.
Get Serious about Investments
Now that you’ve got your taxes, expenses, and budget in order, it’s time to start thinking long-term investments.
A raise is a perfect opportunity to drop more into your retirement account because you’ll never miss it.
If you already max out on contributions, you can consult with an individual and family wealth management service for other long-term investment options.
Do One Thing for You
You worked hard for that promotion and you should get to enjoy that extra money a little bit.
Pick out one thing that you just plain want and get it for yourself. Consider it a personal gift from yourself to yourself.
The main key to getting the most out of a raise is not letting the raise go to your head.
Deal with the tax forms to avoid any tax season surprises.
Work out any new expenses you face, adjust your budget, and explore long-term investment options. Once you do all of that, though, treat yourself to something you really want.
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Category: Career
