LEARNING OBJECTIVES
- Understand why quality of life outside work contributes to career success.
- Get strategies for how to maintain a healthy life outside your job. Personal Finances Impact Career Success
Some employers check credit history before extending offers. One of the reasons for this is the notion that a person’s ability to handle money responsibly is a signal of overall responsibility. This is a well-defined example of how your life outside of work (in this case, your finances) impacts your career success. When you transition to your first job, you have a number of financial issues to manage:
- If you borrowed money for school, you may have to start loan repayment.
- You may need to secure your first off-campus residence.
- You won’t have health insurance through your school, so you need to secure medical coverage.
- You have your first significant paycheck and need to understand withholdings, taxes, and perhaps retirement plans.
Even if this isn’t your first job, financial transitions will occur throughout your life—for example, buying a home, getting married and commingling finances and legal obligations, and having children.
For both the entry-level and the experienced worker, your financial situation dictates how much risk you can take, which may limit your opportunities. If you are living paycheck to paycheck, you might need to tolerate a less-than-ideal work situation. You might not be able to take a chance on a new business or a job change.
Personal finances matter. You can start some good habits start early in your career:
- Check your credit annually. You can get a free credit report at each of the major credit bureaus at https://www.annualcreditreport.com/cra/index.jsp.
- Manage your debt. If you have student loans, get confirmation about when you need to start repaying and how much. With other debts, make sure you pay at least the minimum on time. Late fees and penalties for underpayment can add significant amounts quickly to your original debt. Don’t forget to consider future graduate school plans as you review and organize your debt load.
- Get adequate insurance coverage. You want to be able to focus on your career and not have to worry about unexpected medical bills or something happening to your home derailing your focus. Types of insurance that most people need include medical insurance, dental insurance, life insurance, homeowners or renters insurance, and disability insurance
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