When we get our first job after college, we begin to earn money, get raises, bonuses, or change jobs for more pay. We conjure up what we had considered buying before this newfound financial freedom and spend it too quickly. Instead, we should be using this money wisely.
4. Taking Advantage of Retirement Savings: 401K and Roth IRA
In 2021, the maximum contribution you can make to your 401K is $19,500, likely a steep amount to make if this is your first job. Make some arrangements for some percentage of your paycheck to be withdrawn for your 401K.
You should also open up a Roth IRA account to begin saving outside of work. In 2021, the maximum amount allowed was $6,000. Maybe you received some graduation presents from your family, which would be perfect seed money to put into these accounts.