Thinking about your next career move? Getting a bigger paycheck gives you the opportunity to position yourself to win the long game—financial freedom.
You’ve likely heard it before. Regardless of your income or career path, the number one savings goal is securing your retirement. Though that’s your big goal, there’s always competition for your money—from saving for emergencies to just having what you need to maintain your home and family lifestyle.
When you have more, you can do more. These tips can help you find your path forward.
A job loss, a huge home repair, a medical or dental emergency. Life can throw unwelcome surprises at you at any time, but you can ease the emotional and financial stress by knowing you’re prepared. Create an emergency fund or add to one you’ve already started. Make sure the money is easy to access so you can take care of your emergency quickly.
There’s a lot to take care of when you start a new job—meeting co-workers, learning how the company works, and adjusting to different surroundings. Your new 401(k) should be high on your list. Know what’s in the plan and take advantage of an employer matching contribution, if offered. Also consider rolling over any other 401(k) plans you may have to your new one for a consolidated view of your retirement savings.
Is debt standing in the way of saving for your retirement and other life milestones? If you have credit cards or other loans with high interest rates, tackle them first and pay more than the monthly minimum if you can. Making higher payments can reduce your interest charges and speed up your timeline to becoming debt-free. And that means you’ll have more money to put toward the things that matter.
If you can save more than what you need to get your employer’s maximum company match, open a traditional or Roth IRA for extra savings. IRAs help diversify your retirement portfolio while providing their own advantages. With a traditional IRA, you save on taxes now with a deduction if you qualify. With a Roth IRA, withdrawals are tax-free in retirement. Earnings grow tax-deferred with both IRAs.
A career change is a great opportunity to take another look at your financial plan or create one. While it’s tempting to spend that salary increase, consider instead a disciplined approach to investing that will put you on track to reach your goals. The right strategy will make your money work as hard as you do so you’ll know if you’re saving enough for retirement and for other goals like a new house or a college nest egg.
No matter where you are in your career, Digital Advisor can travel with you on your journey. Even when retirement is far away, our robo-advisor is working on your behalf, focusing on taking the guesswork out of investing and managing your money to help you achieve your retirement goals.
All investing is subject to risk, including the possible loss of the money you invest.
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