3 Smart Money Moves to Make After You Get a Raise
Did you just negotiate a killer raise? Or receive a long-sought-after promotion?
First, congratulations!
Second, kudos on the boost to your bank account. That can be a game-changer, if you manage it wisely.
Third, we’ve got a little homework to give you. Sorry, not sorry; you’ll thank us later.
After you’ve properly celebrated — you deserve to! — take a moment to look at your new and improved finances, and make these smart money moves recommended by Wise Bread.
They’ll ensure you continue to make the most of every dollar, even as those dollars increase.
1. Revisit Your Taxes
Take a look at whether or not you should update your W-4 to adjust your tax withholding with your new salary.
Use the IRS Withholding Calculator to ensure your withholding covers the taxes you owe, so you don’t end up with a surprise bill next April.
2. Budget for Additional Costs
If you’ve earned a promotion, your workload may shift considerably — which could come with increased costs.
If you lose flexibility in your workday or need to work longer hours, you may need to spend more money on food while you’re away from home.
You may have to pay more for child care, transportation or parking. Factor these new costs into your budget along with your increased income.
Also consider which new costs may be tax-deductible!
3. Request a Credit Limit Increase
Your higher income could make you eligible for a higher credit limit. Contact your credit card issuer to request the increase.
Avoid increasing your actual spending on your credit cards, and the credit limit increase will have a positive impact on your credit score.
For more tips on what to do about money after you receive a promotion, read the full list.
Your Turn: Have you recently gotten a raise? Did you consider any of these money moves?
Dana Sitar (@danasitar) is a staff writer at The Penny Hoarder. She’s written for Huffington Post, Entrepreneur.com, Writer’s Digest and more, attempting humor wherever it’s allowed (and sometimes where it’s not).
