Earlier this year I took you through how I am investing as a new grad nurse. In today’s post, I will be going over my payday routine. Payday is honestly the best day of the week. I’ve grown a lot financially in the last year since I graduated from nursing school. Since I have finally started working as a nurse, I have more money. I can contribute to retirement and my other goals. Previous to nursing school, I worked minimum (or close to minimum) wage jobs. Sometimes I do feel a bit behind since traditionally you go straight to college, graduate at 22, and then have your “adult job.” It did take a bit longer for me, so I am working extra hard to make sure my finances are figured out.
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My Payday Routine as a New Grad Nurse
Goal Setting
At the beginning of the year, I set my financial goals for the year. This year my goals are to pay off my car, max out my Roth IRA, and pay for my wedding in full. These overarching goals help me guide my month-to-month and get me to the future I want.
Financial goals are so important and great for everyone to set. It helps you make small sacrifices in more material things on a daily basis because you know what you are working towards. For example, if your goal is to save $20,000 for a house this year, you might skip the pair of Lululemon because you realize at the end of the day, the house is more important to you.
Looking at my Big Picture
Before putting money towards anything, I take a look at my credit cards, bills, upcoming expenses, and the rest of the “big picture” since every month is different. I want to make sure my credit cards (which I used to purchase everything for the points) are paid off in full biweekly. I also look at my goals for the year and month that I set prior to payday to see where I wanted my money to go.
Bills
The first thing that I pay is bills. I am paid biweekly, so typically two paychecks per month. My first paycheck of the month will go towards all of my bills. I pay a car payment, car insurance, rent, phone bill, utilities, pet insurance, renters insurance, and a few subscriptions. If I don’t have any bills, or once I have paid my bills for the month, I move on to the next thing.
Credit Cards
I do not have credit card “debt” because I don’t carry a balance. However, I use credit cards to pay for everything because I want the points. I recently got a new credit card because I am going to be spending more money than normal on wedding expenses.
Danny and I are putting all of our wedding expenses onto the Chase Sapphire Preferred card (I do have a referral bonus here). We are having a destination wedding in Greece so there are a lot of travel expenses. Any travel purchases get 2x the points, or 5x the points if purchased through the reward marketplace. We purchased our plane tickets over the marketplace and got over 10,000 points, so that was really nice. There is also a 60,000 point bonus for spending $4,000 in the first 3 months. Once we have our bonus points, we will be cashing them out to use at hotels for our honeymoon around Greece.
Once I have paid my bills for the month, the remainder of the money from my first paycheck will go toward paying off the credit card balance. From my second (or third) paycheck of the month, the first thing I pay is my credit card balance.
Yearly Goals
The next thing that I do with my money is contributed to my yearly goals. I try to put $250- 500/month into my Roth IRA. I have also been putting as much extra money towards my car that I can. The minimum payment is made during my first paycheck of the month, so anything that I contribute after that is straight toward the principal. I am hoping that once my car is paid down, I can contribute the money I would have been spending on my car towards the Roth IRA.
Savings
Savings is not my biggest priority right now. I already have an emergency fund saved in my high-yield savings account. My savings will be something that I focus on next year as Danny and I save to buy a house. For now, my savings goals are to maintain my current emergency fund in the HYSA and buffer savings in my checking in case I need quick cash. Once we have paid our final installments for our photographer and the venue, we will put the money we have been spending on the installments into our honeymoon savings.
Checking
I don’t keep a lot of money in my checking because I have a savings buffer, and then use my credit card for everything. I usually keep around $300 just in case I need to use my debit card or Venmo. My subscriptions are charged to my credit card, so I don’t worry about over-drafting. Checking feels to be like spending money. If I did keep more money in my checking, I would probably spend it. If there is something big that I want to buy, I make sure to save for it. Once I have the money for a more expensive purchase, I will buy it on my credit card and then pay it off with the money I saved.
Budgeting
I don’t necessarily “budget” because I am already pretty frugal and have low expenses. I do think budgeting can be helpful for some people. Budgeting was more helpful to me when I was living paycheck to paycheck. I have tried not to have lifestyle creep, outside of wedding expenses. Once we have paid for the wedding, a lot of our income will be freed up to put toward our other goals.
It is harder to budget when you use your credit card for everything because you can’t “see” the money. I would not recommend budgeting with credit cards, because I feel like it would be easy to get out of hand. In comparison, when your budget with your debit card/checking account, once the money is gone, it’s gone.
My Payday Routine as a New Grad
That is pretty much everything related to my payday routine as a new grad. I don’t keep a lot of money hanging around because if I do, it’s a lot easier to spend. Once it is in my HYSA, paid towards my car, or in my Roth IRA, I can’t get the money back. It’s working toward my future goals.
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