The thrill of receiving a paycheck after 30 days is unsurpassed. So you got your salary ?? Before you start planning how you are going to spend it, take a pause 🙂
It’s easy to get swayed and impulsive.Majority of us have an emotional relationship with money.Here are five things you should avoid doing with your money on payday:
- Impulse spending: Avoid making impulsive purchases just because you received your paycheck. Take the time to evaluate whether the item is a necessity or a want. Impulse spending can lead to regret and hinder progress towards your financial goals.
- Ignoring bills and debts: Neglecting to pay bills or ignoring debts can lead to late fees, penalties, and a negative impact on your credit score. Make sure to prioritize paying off your bills and debts promptly to avoid unnecessary financial burdens.
- Overlooking savings: Neglecting to save money from your paycheck can hinder your long-term financial security. Always allocate a portion of your income towards savings and investments to build a safety net and work towards your financial objectives.
- Borrowing against your future income: Avoid taking out payday loans or any high-interest short-term loans. These loans often come with exorbitant interest rates and can lead to a cycle of debt that is difficult to break free from.
- Spending excessively on non-essentials: While it’s essential to treat yourself occasionally, consistently spending excessively on non-essential items can quickly deplete your funds. Make sure to strike a balance between enjoyment and responsible financial management.
Some smart things you can do with your money on pay day:
- Create or add to an emergency fund: Building an emergency fund is crucial for unexpected expenses, such as medical emergencies, car repairs, or job loss. Aim to save six months’ to 12 months’ worth of living expenses in a separate, easily accessible account.
- Set Financial Goals: Use payday as a reminder to evaluate and update your financial goals. This could include saving for a down payment on a house, paying off student loans, or planning a major purchase.
You are free to get in touch with me:) When it comes to getting the most out of your money, another helpful strategy is to get the opinion of a financial counsellor.