Don't just accept any salary offer! No one is going to manage your career except for you. Alexa von Tobel, Founder & CEO, LearnVest.com, offered tips on salary negotiation when she visited me on Mondays With Marlo.
For more fantastic financial advice, see Alexa's personal finance tips:
Turn Up The Temperature
If you open your refrigerator and set it to the appropriate temperature (between 35 and 38 degrees), you can save up to $400 per year. The fridge is your most expensive appliance and it's on 24 hours a day, so regulating its temperature can make a big difference on your power bill.
Use Better Bulbs
Changing out all your light bulbs to fluorescent bulbs can save you $20 or $30 a month.
Shrink Your Cable Bill
There are many smart ways to minimize your cable bill. There's a great site, called <a href="http://www.billshrink.com">billshrink.com</a>, where you can enter how much your bill is and they'll show you how to save another $10 or $20 each month.
Have Emergency Funds On Hand
Everyone should have an emergency savings fund with six to nine months worth of living expenses saved up.
Getting your finances organized is half the battle. One way to make sure everything is in one place is to create a separate email account just for your bills, like: email@example.com.
Know The Difference Between "Good Debt" And "Bad Debt"
"Good Debt" is something like a mortgage or even student loans, which represents a big financial commitment that is also an investment in your future. Sure, there is interest to pay back, but you go into the debt knowing exactly what the interest rate is and how much you'll have to dedicate to repaying what you owe. "Bad Debt" is something like credit cards, where the interest rates are exorbitantly high and worst of all, the interest just grows and grows every single day.
Know Your Numbers
It's very important that you know the most important numbers: your income, expenses, and credit score. You check your credit score for free at <a href="http://www.creditkarma.com" target="_hplink">creditkarma.com</a>. A credit score is the only grade that matters after you leave the education system, and it follow you forever. If you have a good score, you'll be able to borrow for things like buying a home or starting a business at much lower interest rate, which can save you hundreds of thousand of dollars.
Save For Retirement
Start saving for retirement <em>now</em>. The sooner you start putting money aside the harder your money will work over time, and the older you get, the less you'll have to put away to live comfortably when you retire.
Find Out Where Your Paycheck Goes
You can link all of your accounts on <a href="http://www.learnvest.com">LearnVest.com</a>. Link your credit card, savings account, and investing account to see your average monthly spending. LearnVest will allocate it to different folders: eating out, utilities, shopping, whatever it may be.
Create A Budget
Use the 50-20-30 budget method. Calculate your monthly income after taxes and contributions. From there, 50% of your monthly income should go towards bills and essentials, 20% should go into your savings for your future and the rest is what you have left to have fun with.
If you're not married, don't combine your finances. Set up a joint checking account for both of you to share and put the same percentage of money from each of your paychecks into it. This way, you're both carrying an equal share of the bills. Then pay your shared expenses from that account -- your dinners out, your rent and your utilities.
Make An Informed Purchase
Buy real estate that you can really hold onto. It's typically not an investment, especially if you're not a real estate investor, or real professional. Buy property that you can hold onto for 5-8 years, a place that's big enough for you to really grow into.
Three Biggest Things That Affect Credit Score
1. How long you've had credit. Someone with ten years of credit history will be more trusted than someone who has only had two years. 2. Bills you have paid late. You never want to make a late payment on any bill, whether it's a hospital bill or your AT&T bill. Never miss a payment. 3. When you have a credit card, you have a limit. You never want to max out your credit cards. In fact, you never want to spend more than 30% of what the limit is. So if you have a $10,000 limit, you never want to spend more than $3,000 without quickly paying it back, because they don't like to see your credit-to-debt ratio be too large.
Three Tips For Negotiating Salary
1. Go to <a href="http://www.salary.com">Salary.com</a> and check out what other people in similar industries across the country are making for your job. Get armed with some facts. 2. Go to your employer and say, "Listen, I appreciate your offer," (be gracious about it), "but I was actually hoping to get paid this, because honestly, that what is market rate." The worst thing that they can say is "no." 3. If the employer says no, go back to them and see if they can give you any other benefits, like paying for your cell phone, paid vacation days, or more equity.
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