The idea of earning a double-digit salary is no longer just a dream for many workers, including fresh graduates. Many newcomers to the workforce aspire to higher salaries, confident in their education and skills.

However, earning a double-digit salary shouldn’t lead to complacency. A high salary doesn’t automatically guarantee wealth. In fact, those with higher incomes often face greater financial risks. While you might earn more, managing and growing your money effectively can still be challenging.

Higher income often leads to a corresponding lifestyle adjustment. For instance, someone with a minimum income might shop for budget-friendly items, whereas someone with a higher salary might opt for branded goods. These changes in spending habits can create a false sense of financial security.

Read: 6 Easy Ways to Turn 1 Million Rupiah into a Profit

How to Manage a Double-Digit Salary Wisely

No matter your income level, effective money management is essential. It's crucial to avoid unnecessary expenses while fostering financial growth, ensuring your earnings are wisely allocated each month. Here are some tips for managing a double-digit salary:

1. Track Every Expense

Monitor all expenditures to gain a clear understanding of where your money goes. This awareness allows proactive financial management by identifying unnecessary expenses and reallocating resources more effectively.

Tracking expenses is a fundamental practice in personal finance management, empowering you to make smarter financial decisions, avoid unnecessary debt, and build a solid foundation for achieving financial goals.

2. Save First, Spend Later

Prioritize saving before making any purchases or indulging in non-essential spending. Allocate a portion of your income for savings right after receiving your paycheck to ensure financial security and future preparedness.

3. Set Financial Goals

Clear financial goals act as a guiding framework for managing expenses more effectively and responsibly. Defined goals encourage discipline in daily financial decisions and pave the way for achieving significant milestones, such as buying a house, funding children’s education, or planning a comfortable retirement.

Financial planning not only ensures the achievement of these goals but also provides a solid strategy for managing money wisely throughout life's journey.

4. Allocate Your Salary

Divide your monthly salary into three key categories: necessities, savings, and lifestyle. While allocations vary based on individual needs and preferences, here’s a common example:

• Necessities: 50%-70% of monthly income, covering food, transportation, rent or mortgage, utilities, and other essential expenses.
• Savings: 10%-20%, focusing on building emergency funds and preparing for the future.
• Lifestyle: 10%-30%, for leisure activities, dining out, hobbies, and other non-essential expenses.

Example for a monthly income of IDR 15 million:

• Necessities: 60% x 15,000,000 = IDR 9,000,000
• Savings: 20% x 15,000,000 = IDR 3,000,000
• Lifestyle: 20% x 15,000,000 = IDR 3,000,000

Alternatively, use the 50-30-20 rule: 50% for living costs, 30% for savings, and 20% for lifestyle. Adjust percentages as needed to suit your financial goals and personal situation.

5. Seize Every Opportunity

Explore additional income sources such as side jobs, financial investments, or discounts on purchases to maximize financial growth. Relying solely on a fixed salary can limit your financial potential.

Regardless of your income, managing it wisely is crucial. A double-digit salary alone is insufficient without careful planning and control. Conversely, even a modest income can be stretched effectively with good financial planning.

Manage your salary effortlessly with neobank, featuring products like savings and deposits designed to help you grow your wealth.

Download the neobank app from the PlayStore or App Store. Open Neo Savings, WOW Time Deposit, FLEXI Time Deposit now!

For complete information and terms & conditions regarding neobank app products, click the following links:

- NOW Savings: https://s.id/NOWsavings

- WOW Time Deposit: https://bit.ly/EdWebDepositoWOW

- FLEXI Time Deposit: https://bit.ly/EdWebFLEXI

If you want to try neobank app products, click the links below:

- NOW Savings: https://s.id/neosavingsnow

- WOW Time Deposit: https://s.id/neodwowtimedeposit

- FLEXI Time Deposit: https://bit.ly/EduDepositoFLEXI

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PT Bank Neo Commerce Tbk is licensed and supervised by the Indonesia Financial Service Authority (OJK) and Bank Indonesia (BI), and an insured member of Deposit Insurance Corporation (LPS).