Receiving a promotion and raise is not only an honor but it is a big step in your career. As you continue to prove yourself, and climb the corporate ladder, it’s important to make responsible financial decisions. What should you do with your new found financial freedom? While this is a time to celebrate, it’s also an opportunity to get ahead financially. Before you make any major purchases we encourage you to consider these five fun, yet responsible, ways to enjoy this milestone:
1) Celebrate (within reason)
All work and no play isn’t good for anyone. Celebrate your new promotion with something special: dinner out, a long weekend getaway, etc. However, we encourage you to keep the celebrating under control. The last thing you want to do is squander your excess income in the coming months. Decide how much you can afford to spend celebrating and cap it once you’ve reached that point.
2) Pay Down Your Debt
If you’re carrying student loans, credit card debt, car loans and/or a mortgage, now is your chance to get ahead. While it is a good idea to hold on to some of your excess income for a ‘rainy day,’ we do encourage you to use some of that raise to pay down your debt.
3) Plan for the Future
If you haven’t already started planning for retirement, now is the time! You’re used to living on a smaller income, so why not continue to do so? Rather than spending your raise frivolously, this is your chance to begin putting money away for retirement. Meet with a licensed professional and outline a retirement savings plan that allows you to continue living comfortably while saving for the future.
4) Save for Tax Season
One thing we often forget to take into consideration is an increase in taxes following a raise. If you’re behind on your tax savings for the year, or you will face higher taxes as a result of your raise, now’s the time to start saving. This is the best way to avoid surprises when tax season arrives.
5) Review Your Insurance Coverage
From car insurance to life insurance, now is the time to review your coverage. If you’re not carrying full coverage car insurance, you might want to consider doing so now. It’s particularly important to review your life insurance at this time as your needs have likely changed. How much coverage would your loved ones need to account for your increased income? If your current coverage is inadequate, now is your chance to compare life insurance quotes. You may be surprised to learn that an increase in coverage is quite affordable!
As you enjoy your new career status, we encourage you to take advantage of the new opportunities available to you. If you would like to learn more about your life insurance options, request a term life insurance quote today.
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