Starting a New Job?
Here are five important tips when starting a new job…
In On Investing, (Charles Schwab) youll find listed these helpful ideas. My comments are in brackets:
1.) Sign up for your new employers 401(k) or other retirement planespecially if you havent been started to save for retirement. Your are never too young to begin! Contribute at least enough to receive any employer match. [Do take the time to investigate how the plan is handled, also be sure to get full disclosure where the money is invested. Never have all of your retirement money tied up in your company's stock. Don't wait to begin saving for retirement. If you don't have any retirement offered at work, check into setting up either a Traditional or Roth IRA. Contact a broker like Charles Schwab for more information.]
2.) Make every effort to rebuild your emergency savings if you drew down that fund while you were unemployed. [Many people found they were, or are, unemployed much longer than ever before. Ideally, you should have at least a 6 month emergency fund--basically that's enough to cover all your living expenses for 6 months. But in light of what we're seeing in the economy today, it's better to have even more--a year's worth of emergency money to tide you over. It takes commitment to sock away a good chunk of your salary. Do so by watching what you spend your money on daily and taking advantage of automatic withdrawals from your paycheck that go directly into savings. If your company has a credit union, that's a good place to obtain higher interest rates, better service, and more free perks like checking.]
3.) Reassess your budget. If your new position pays less than your previous job, adjust how you allocate your household budget. If you earn more, boost retirement contributions or repay debt. [I believe putting money into an emergency fund comes before contributing to a retirement fund and other experts agree on that point. Whatever you do, don't take on more debt. When it comes to debt, be sure to get the advice of a qualified debt consultant and read all you can on the subject. Some well-known advisors have changed their ideas about paying down debt and I especially like what Suze Orman suggests on this subject. She has a new book, The Money Class, released 2011.]
4.) Claim the right number of withholding allowances so you dont pay too littleor too muchincome tax. The IRS offers a withholding calculator at the IRS site to help you determine the most appropriate withholding for your circumstances. [If you are receiving a great deal back in a refund every year, check to see if your withholding is incorrect. The idea is that you'd rather have that money coming to you every pay period, instead of it coming back after April 15th.]
5.) Take full advantage of health and life insurance plans and any other benefits the company offers. Benefits may include flexible-spending and dependent-care plans, which allow you to pay for medical and daycare costs with pretax dollars. Dont delay signing up for workplace benefits: some employers require you to enroll in such plans within 30 days of starting work. [When you have an employer plan, the cost is most often much lower than if you tried to find the same benefits on your own. Read the information on the employer plans carefully, write down questions, bring those to the person handling the plan for the company. Weigh what you get--or don't--carefully, depending on your personal needs. One thing you should never do is to go without any health insurance, no matter how healthy, or young, you happen to be. Debilitating accidents do occur and are quite common in people under 40, they can wipe you out financially.]