Manage your money to avoid career stress

Man leaving office carrying plants and files in a box

How to plan your money so you survive career upsets.

Career bumps - such as redundancy or leaving work due to ill health - happen.

By managing your money well, you can get past career bumps and relieve some stress, says Sorted managing editor Tom Hartmann.

The following tips will help you plan your money.

Reduce your spending

Start by looking at your spending, says Tom.

You may be spending money on things you don’t need.

“Ask yourself, ‘Do I really need that gym membership I don’t use or that magazine subscription, or can I get rid of them?’”

Put aside an emergency fund

Once you’ve looked at your spending, calculate what your essential bills cost.

“Put aside enough money to cover those bills for two to three months, or whatever you can afford. Every bit helps.

“Think of it as a fully-funded emergency fund. Whatever happens, you are covered for that time.”

Set a budget

Budgets are simple plans that help keep your spending under a certain amount.

Tight budgets look good, but can be unrealistic, says Tom.

“By sticking to a budget and having savings set aside in an emergency fund, you’ll be better placed to cope with the initial shock and stress of losing a job.”

Pay yourself first

Tom says he likes the ‘pay yourself first’ way of saving because it’s easy and effective.

“Most of us pay our bills first, then spend what’s left over.”

Paying yourself first works the other way around.

“Save some money as soon as you get paid, then pay the bills.”

Use savings well

If you have savings, or get a payment as part of your redundancy, use it wisely.

“They need to be liquid funds so you can get to them quickly, but they need to be clearly separate and not part of your budget.

“Unsecured personal loans or credit cards usually have higher rates, so it can be more cost-effective to reduce them first.”

Find out more

Sources

  • Employment New Zealand website, accessed November 2019, (www.employment.govt.nz).
  • Hartmann, T, managing editor, Sorted, careers.govt.nz interview, November 2019.
  • Sorted website, accessed November 2019, (www.sorted.org.nz). 

 

Updated 9 Jan 2020