Landing your first job is a crucial milestone that not only jumpstarts your career, but also fulfills your financial goals. This is because having a source of income can significantly boost your cashflow. And that allows you to budget better, save, and even invest in wealth-building. That being said, the first step you need to take towards managing your finances as a first-time earner is knowing where to store your money.
While opening an account in a traditional bank is a common option for first jobbers, you may also choose to put your money in a digital bank to enjoy higher interest rates. You can also choose to keep an e-wallet, or a digital wallet that stores payment information and allows you to make cashless purchases from a credit card, debit card, or prepaid account, for increased accessibility.
Often, these digital banks and e-wallets can also be linked to a physical card which will allow you to withdraw money or make cashless transactions for added convenience. For example, if you sign up to Maya, open a Maya savings account, and use Maya to pay, you can get a free Maya VISA or MasterCard card to get access to your money and withdraw from any ATM or to pay online or offline, both locally and abroad.
However, don’t let the convenience of your payment card or e-wallet tempt you into spending recklessly. It’s all the more important to be mindful of your spending as a first-time jobber to ensure you build strong financial habits from here on out. Here are some tips for using both your payment card and e-wallet responsibly:
1) Set Spending Limits
It may certainly be exciting to receive your paycheck after each cut-off, but that same excitement can also lead to impulse spending if you’re not careful. Use your e-wallet or payment card’s spending limits feature to ensure you stay within your budget. Imposing these limits will allow you to become more mindful of your spending. It also allows you to prioritize necessities such as groceries, transportation expenses, utility bills, and other financial obligations.
Train yourself to spend only within your budget for each payment card and e-wallet you use. This reduces the risk of draining your paycheck each month and will make it easier to leave some room for savings or investment opportunities.
2) Monitor Transactions Regularly
Being able to monitor your spending via your e-wallet or card’s accompanying app is a must for many reasons. For one, it allows you to get a clearer picture of where each dollar of your paycheck is going. As each expense gets its own entry in your transaction history, you can spot spending patterns. Those patterns help you evaluate whether they’re necessary expenses or not.
For example, you may notice that your e-wallet’s transaction history is full of payments in your shopping app. This can serve as a wake-up call to cut your online shopping expenses and redirect that money to your savings.
Another benefit of monitoring transactions regularly is that it trains you to quickly spot fraudulent transactions, double charges, or any suspicious activity on your account. That means that you’ll be able to report the incident to your e-wallet or card provider right away for resolution.
3) Maximize Deals and Promotions
Make it a habit to check your e-wallet notifications or their official social media accounts for money-saving promotions. As a first-time earner, your financial capacity is most likely still limited. Your effort to take advantage of deals or cashback promotions can translate into significant savings on your everyday expenses.
Say you’ve seen that your e-wallet is offering a store discount if you use their app during payment. Then you can consider shopping for your necessities from that particular store to stretch your budget.
4) Prioritize Security Measures for Your Accounts
Keeping your money safe is a must, especially in this day and age when scams and cyberattacks are prevalent. Make sure your e-wallet is always safe by activating two-factor authentication (2FA) for a layer of protection to your account. Make sure you keep sensitive information such as one-time passwords (OTPs), card details, and passwords private as well.
In addition, be wary of unsolicited messages that ask you for your sensitive information. More often than not, these are scammers pretending to be legitimate customer support staff to gain access to your account. Remember that no legitimate e-wallet or payment card provider will ask you for your password.
5) Leverage E-Wallets for Savings and Investments
Many e-wallets now offer features that let you grow your money, such as high-interest savings accounts or investment products. Even if you’re a first-time earner, saving and investing as early as now can go a long way towards helping you reach financial goals such as buying your first home, purchasing a car, or starting a business. Today’s e-wallets make saving and investing easier for you by allowing you to seamlessly move money from your e-wallet to your savings account and to make investments without paperwork.
However, do make sure to research what investment products suit your current risk tolerance and financial means. This is especially true if you don’t have a lot of disposable income just yet. For example, if you want a relatively safe investment option, mutual funds could be a good starting point for you. You can also look into time deposit accounts as these typically offer higher interest rates, so long as you don’t mind keeping your money in the account within the designated term period.
E-wallets and payment cards have the potential to make your financial life easier, even as a first jobber. Make sure you’re using these tools to the fullest to develop your skills at budgeting and financial management. Doing so will lay a solid financial foundation for yourself as a young professional.
Photo Credit: flaticon
Question of the Week