‘I recently had my salary increase from 65k to 75k. I’m not too sure what to do with this money.’: I have a salary raise but lack financial guidance. How can I ensure a secure future for my family?

Hi Money Minder,

So, I just got a raise from 65k to 75k, and I’m not sure what to do with it yet. (I know, not a fortune, but it’s a big deal to me!)

Quick background: I graduated in 2023 and already had a job waiting for me. I’ve been saving most of my paychecks and feeling pretty good about it. Right now, I’m still living at home, but I’m planning to move out soon.

I’ve got around 25k spread out in two High Yield Savings Accounts and a regular savings account. I’ve also been putting money into life insurance since junior year of college. Oh, and I put $100 into VOO – newbie move, I know! I haven’t started a 401k yet, but it’s on my to-do list.

Any tips on how to make the most out of this new cash flow? I grew up in poverty, and my main goal is to make sure my future kids never have to go through what I did.

Cheers,
Savvy Saver

Response from THE MONEY MINDER:

Hello There,

Congratulations on your salary increase! It’s great to hear that you’ve been able to save most of your checks and feel comfortable with your current financial situation. Moving out in a few months can be a big step, so it’s essential to be prepared. With your savings across different accounts and your investment in VOO, you are on the right track.

Since you have plans to invest in a 401k, that would be a wise decision to secure your future. Additionally, consider looking into other investment options that align with your financial goals. It might be beneficial to consult with a financial advisor to create a comprehensive financial plan.

Given your background and desire for financial security, prioritizing emergency savings and continuing to save and invest wisely will help you build a strong financial foundation for yourself and your future family. Remember to keep a realistic budget, track your expenses, and set achievable financial goals. Taking these steps will ensure that you are on the right path towards financial stability and achieving your long-term financial aspirations.

All the best on your financial journey from THE MONEY MINDER.