I write a lot about finding your passion, conquering fear, and doing something different to pave your own way in the world. And these are still the most important topics when we talk about career. But, you may be thinking, what about the money? Because once you've figured out the passion piece, you still need to earn the cashola. Right? Right. And there's a lot to think about when you're managing all that money you're about to be earning, from before you accept the job, to when you're well on your way.
When you consider the personal finance aspect of your career, one way to look at this is to focus on earning more. You can do this by negotiating your salary and benefits to maximize the amount that you're earning and the amount that you have available for practical considerations.
When you get an offer, your best friend in salary negotiation is glassdoor.com. Do your research to determine what range of pay you can reasonably expect in your city, and so that you'll have data to back up any request for more. Also think about your take-home pay, which is usually about 75% of your quoted gross pay (so while $70,000 sounds like a lot, remember that you'll be taking home about $52,000 after taxes and deductions). Then, put together a well-worded proposal about what you would like to make and explain why, citing the research that you did online. Need in-depth tips on salary negotiation? Read my blog post on this topic here.
You can also negotiate signing bonuses, relocation costs if you're moving for your job, and other benefits.
One of the biggest questions I get from students negotiating their first job offer is: What is the 401k? Am I supposed to negotiate or pay attention to that?
A 401k is a company sponsored retirement account. In it, you'll be saving and investing money that you can begin to pull out when you're old, but not before then. Here's all you need to know about your company's retirement plans for now: Listen for "employer matching". A typical employer match is something like 4%, and this means that your employer will contribute up to 4% of your annual income into the company's sponsored retirement investment plan, IF you also agree to put in up to that amount from your own pay check. The percentage they contribute on top of your contribution is free money, and a fantastic benefit. The higher the match, the better. Some companies automatically contributes something into your company-sponsored retirement plan (aka 401K), without you needing to match that (and that's extra fantastic, but you should still get in the habit of putting money aside). So as soon as you start work, set up your retirement contributions so that you maximize any employer matching. Remember: it's free money!
Stock options are a benefit offered to encourage you to stay with your employer for a longer period of time. You're given the opportunity ("option") to buy shares of the company's stock, usually at a discounted price, and then the opportunity to sell those shares, hopefully at a profit, when your stock "vests". If you're getting this as part of your compensation package, it's a good idea to do some good finance research to learn about investing, stock, and to get a feel for whether utilizing these options is a good fit for your personal finance portfolio and style. At the end of this post I'll give you some good general resources.
Debt management: Student Loans
Don't freak out about your student loans. It's really important that you pay them back, and you should prioritize getting rid of your debt quickly so that you can move on to putting your money in more exciting places. But there are some strategies that can help you manage your loans, especially if you're not making a lot of money in your first jobs out of college. Call up your loan provider or go online to ask about flexible repayment options. If you have federal student loans, you'll be able to adjust your monthly payment based on your income. Or, you might be able to get a better monthly payment and interest rate by refinancing your student loan. Take a look at SoFi (www.sofi.com) to see if you can get a better deal.
Keeping (and Growing) What you Earn
You're about to earn more money than you ever have before in your life. So you want to make sure you're taking good care of those funds. I recommend setting aside some regular free time to educate yourself on personal finance (this is way more fun than you think it will be!). My favorite websites for how to manage and grow your moolah are:
LearnVest. A great comprehensive personal finance site for young professionals. You can even get a free financial advising appointment (great for helping you through all those 401k and investing questions!)
Daily Worth. Great money advice and day to day personal finance inspiration and information.
Mr. Money Mustache. Want to be able to retire at 30? This is the website for you.