Friday Finances – Factors affecting finances part 2
So what can we control?
*The first is interest. Now I know you’re thinking, I can’t control how much interest I’m making or paying. True, to a degree. We can control whether or not we PAY interest or EARN interest. We can also partly control how much interest we pay by making wise financial decisions. Having good credit usually allows you to pay less in interest. For example, when setting up our local phone (and internet) my husband and I did not have to pay any security because of our credit. However, if we would have had bad credit, we would have had to pay a security.
*The second is time. We can control how soon we start putting money into savings/investments. This can be difficult at times, having lived through my husband getting a masters degree and through a period of unemployment, I would say that we can’t always control when. However, we can decide to put that into our budget. We did in fact save money (not retirement) while my husband was in grad school, we just happened to need it later when we were dealing with unemployment. Now we are not unemployed, we have a savings plan set up. We are also going to be starting to save for retirement when enrollment opens (after the waiting period for benefits at his current employment).
*Third factor in our control – education. Typically as we gain more education our salary increases. Now I do have to admit that in my husband’s field this is not very true… experience is typically valued over education. So with a Master’s Degree he isn’t making much more than he would have started out making with a Bachelors. However, he has more knowledge which helps him in the job…
There are more ways to get an education than going for a 4, 6, 9-year degree. There are technical/trade schools, community colleges, etc. Achieving a higher education increases the likelihood you’ll like your job.
*Fourth, we can control our career. Meaning we can choose which career path to take. I can choose to be a teacher (known for lower salaries) or I can choose to become an engineer or a doctor. Of course our personal likes/dislikes and interests help us choose as well. Unfortunately we cannot choose whether our chosen field is a high-money making field or a low-income field – but we can take those into consideration when choosing a career path.
*Fifth, Benefits. Employee benefits is one aspect that should be looked into before starting a job. (I do realize there are time when you have to take a job without benefits, I’ve done it!)
Some things to consider when looking at Employment benefits: Compensation for time not worked (paid time off for vacation, sick leave, personal leave-funerals-weddings-births, etc); Health Insurance (dental and vision included?); Retirement Plans – do they match any of your contribution?; Employer provided services (fitness programs, discounts on products, child-care subsidies – these are not as common).
If possible it is wise to compare salary and benefits when obtaining a new job. You will also want to compare cost of living if the jobs are in different cities.
Your assignment this week is the same as for the past few weeks – keep tracking your spending!