After you finally land your first big job, there are a lot of things to think about. Whether straight out of high school or college, a full-time job and all of the expenses that will most likely come with it can be a big shock if you’re not used to it. Luckily, I’ve been working full-time since 16 and officially started my analyst job at the age of 20 after I graduated from college. I’ve been living on my own right after I turned 18, so I am used to the expenses since I started very young and pretty much right after I was able to.

However, I have many friends who still don’t have full-time jobs but are about to get them. They’ve never really had expenses to think about and they are constantly asking me questions about it all. Living on your own for the first time can be really shocking and there are so many expenses to think about.

Below are some money tips to consider after you score your first big job:

1. Calculate your actual pay

It’s really tempting to jump for joy when you first realize how much money you might be making. But don’t forget to calculate how much it will be after taxes and all other expenses. Many employers take a premium for your insurance directly out of your pay, and you should be aware of how much this is. I have a friend who had $200 taken out of every paycheck for his insurance, and this therefore didn’t leave a whole lot of money leftover.

I also have a friend who didn’t realize that the lowered Social Security tax of 4.2% instead of 6.2% was only temporary. She had only worked while it was enacted, and when it went back to 6.2% she was shocked. All taxes need to be realized and budgeted in.

2. Calculate how much you will have PER MONTH

After you calculate your actual pay, also factor in how much you will be getting paid per month. I get paid every 2 weeks, not two times per month. Some people think this is the same but it is not. If you just take the amount you will make per year, such as $50,000 per year and go out on a limb and divide it by exactly 12 months (in order to come up with a monthly budget based on getting paid every 15 days), you will come up with $4,166 per month before taxes. However, if you actually get paid every 2 weeks, then you would be making approximately $3,846.

Therefore, how you make your budget in this instance is very important! If you just take your salary and divide it by 12, when you actually get paid every 2 weeks might hurt your budget because you will be under by a little over $300 per month. Of course, if you do actually get paid every 2 weeks, then in certain months you will be making a lot more money than usual because some months might be 3 paycheck months.

3. Don’t sign up for lots of loans right away

When you get your first big paycheck, you might feel the need to go out and buy a new car or a bunch of expensive electronics. WAIT though! Wait until you get the feel for how your expenses and budget will actually go.

What money tips do you have for those who get their first job?



Michelle Schroeder is the founder of Making Sense of Cents and Diversified Finances, a personal finance and lifestyle blog about budgeting, traveling, life, and student loans. Read further on her story and life.