Smart Financial Steps to Take as You Become a Mechanic
Career Path : Automotive
Congratulations, you are almost finished your mechanic training. A time for celebrationâ¦ and financial planning.
1. Pay down debt
Did you have to take out any loans to become a mechanic? Or, did you rack up any debt on your credit cards while you were in your mechanic program?
As soon as you become a mechanic and are earning, you should make paying off any debt a top priority.
2. Start an emergency fund
Paying down debt should be a priority after you complete mechanic training, but not at the expense of all other financial goals. You also need to secret away cash each month to build an emergency fund. An emergency fund is accessible money (i.e., money that is in a high-interest savings account as opposed to tied up in another investment) that you can use after you become a mechanic in case of disability, illness, or some other unexpected situation that limits your ability to exercise the skills acquired in your mechanic program.
Ultimately, you will want to build up an emergency fund that is equivalent to six to twelve monthsâ pay. But this is not a goal that is quickly accomplished. Slow and steady wins the race. Simply start directing $100 to $200 a month towards your emergency fund once you complete your mechanic training and become a mechanic.
3. Open a registered retirement savings plan
What, save for your retirement, at your young age? Even new graduates of mechanic training need to think about their future â the earlier, the better: the earlier you start to save for retirement, the less you will have to save over the long run.
So as soon as you become a mechanic, run to your bank to open up a registered retirement savings plan. With a little luck, your first employer after completing your mechanic program will offer an employer-matching program, whereby they match your contributions dollar by dollar up to a certain amount.
4. Read your cheque stubs carefully
With a little luck, you will land a job as soon as you complete your mechanic program. With this first job will come something else: your first pay cheques. These are important and must be treated carefully. Read your cheque stubs each week after you become a mechanic. Doing so will give you a good understanding of two valuable pieces of information:
- your gross pay (your pay before any deductions for taxes, health, etc.)
- your net pay (what you actually get after all deductions are taken off)
Your net pay tells you how much money you will actually have coming in from week to week after you become a mechanic. It is the amount that you use to determine your budget. But, more on that later. For now, simply concentrate on completing your mechanic program and finding your dream job.