5 Financial Moves to Make After Starting a New Job

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Congratulations on the new job! Don’t start spending all of that newfound income just yet. Instead, make a smooth transition by following these financial moves, brought to you by Discover.

  1. Before leaving your old job, double-check your unused PTO.

Every year, Americans leave approximately $272 billion of paid vacation—or 200 million vacation days—unused. But depending on the state you work in, leftover PTO is considered a type of compensation. If you still have unspent PTO before leaving your old job, contact Human Resources to see if you have a right to cash those days out. (And don’t forget about any sick pay or potential stock options!)

  1. Rollover your old 401(k).

If you have a 401(k) from your previous employer, consider rolling those funds over to your new employer’s retirement plan. But check your fees first: Employer-offered retirement plans can come loaded with relatively high fees—and the investment options may be limited—so you may want to consider throwing your old 401(k) into an IRA instead, which generally offers more funds and flexibility.

  1. Continue your old lifestyle for a few months ...

If you just received a raise, celebrate! And don’t change a thing. Avoid falling into the trap of “lifestyle inflation”—that is, don’t spend all of your newfound money—and try to stick to most of your old spending habits. After sticking to your old spending habits for a few months, check your budget: How much have you really been able to save? How much extra are you really bringing home?

  1. … then revise your personal budget.

After crunching the numbers, then you can consider updating and revising your budget and spending habits. Experts generally recommend putting about 80 percent of your new income into paying debts, or socking it away for other savings goals. Put the other 20 percent into your checking account (and do whatever you like with it!)

  1. Review your new company’s benefits closely.

Nearly 30 percent of your compensation will come in the form of benefits. The most important of those benefits will be healthcare and retirement, though there will likely be plenty of other offerings that could save you oodles of money—gym membership discounts, commuter savings, even theme park or theatre tickets. When you land the job, crack open that benefits guide and read all of the details so you don’t miss out on all of those deals!

No matter what stage of life you're in, you can always spend smarter, manage your debt better, and try to save more to achieve a brighter financial future—and it’s Discover’s mission to help. Learn more at Discover.