Ready to party after a pay raise? Not so fast . . .

When you earn a bump in pay, it’s natural to want to plan your next purchase. Have you been pining for that new iPhone X? How about a new fall wardrobe? Before you slap down that credit card consider these 3 actions you should take immediately after getting a pay raise.

Add to your emergency fund
Now is the perfect time to consider adding more cash to your emergency savings. Unfortunately, in most cases it isn’t about if you’ll need to dip into this fund in the event of an unforeseen urgent issue, but when. Although you’ll be excited for your bump in pay, put your emotions aside and resist the immediate urge to treat yourself to something new. Instead save up for that unexpected home repair or that high doctor bill. It may not be the most exciting way to spend, but it is one of the smartest financial choices you can make.

Pay off card debt
Have you gotten accustomed to making the minimum payment due on your credit card? You may feel like you’re tackling your debt, but in reality, paying only the minimum is not really helping you dig out of that financial hole. Now that you’ve got a little extra cash to spare, map out ways you can throw more money at your card balance. This will help take a larger chunk out of that mountain and get you closer to your goal of paying the card (or cards) off in full.

Don’t change your habits
If you’ve put more in savings, are working on your credit card bills, and still have a little extra money, it’s smart to keep fighting the temptation to splurge. Just because you are making more or received a hefty bonus doesn’t mean you should change your lifestyle. Instead make smart choices for the future. Invest wisely, plan for retirement, and keep watching your current budget. Then down the road, you’ll be in better financial standing because of the good habits you established and maintained.

 

Wendy Moody

Wendy Moody

Wendy Moody is a Senior Editor with CUInsight.com. Wendy works with the editorial team to help edit the content including current news, press releases, jobs and events. She keeps ... Web: www.cuinsight.com Details