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Start a New Job with Good Finances

Updated: Jun 6, 2023

With my new job looming (10 more days, folks!), I've taken an hour to get all my ducks in a row. Straight line please, ducks!!

Anyway, there are a few important things you should do before you step foot into the office (or a Zoom call). Do this on your own time so you can clear your mind for your first day of work!


But, Frugal Zoomer, I'm just starting a job! Why would they give me a bonus?

Well, that's a very good question, young Jedi. And the answer is, I have no idea. However, many competitive and especially tech companies offer some combination of a signing bonus, relocation bonus, and relocation reimbursement. If your job doesn't offer you any, ask! If you already have the offer, there's no harm in asking. You could phrase it like: "I'm so excited about this offer. However, I am concerned about the money required to sign a lease / hire a moving company / fly to ____ before my job starts. Do you have any sort of relocation package that could help me out?"

They might say no, but you may as well ask. They won't revoke your offer and they won't wave a hairbrush at you spitefully.

If you do get it, this free money is fantastic, but be sure to:

  • Check the terms. Most likely you'll have to stay at the company for some length of time (maybe a year) in order to keep the money. Take this seriously. You could owe them that huge amount if you leave the company before this date. If you might not stay that entire length of time, keep the bonus in a separate account where you won't spend it.

  • Compare packages. My company actually offered me the choice of a signing bonus or a relocation package (once I asked -- I took the one with more money). More commonly, companies will ask you to choose between relocation lump sum and reimbursement. With a lump sum, they give you a set amount in cash and it's yours to use however you want. With reimbursement, they will pay you back for all moving related expenses. If you need to hire a moving company, fly across the world, or move a large family, it might make sense to do the reimbursement. However, if you're young and fairly frugal, the lump sum probably makes more sense. My moving costs are basically just $100 to drive to Boston, but I'll find a use for the other $5,900!

  • Stay organized and communicative. After you've reached an agreement with HR, the hardest part is done. However, you should still record all moving expenses. Keep checking in with your recruiter, boss, or external company to make sure you're on track to start on time and receive your money.

P.S. Sadly, your bonus gift will likely be taxed at an extra high rate. I asked around and friends / coworkers had tax rates ranging from 25% to 45% of their lump sum.

Get ready for your W-4

HR or Payroll is almost guaranteed to ask you to fill out a W-4, alone or with their help. A W-4 is a tax form that goes to the IRS. They determine how much of your paycheck should go to you, and how much should go to the government.

If they take too much money out, you'll feel strained for cash but then get a lump sum back next April. If they don't take enough money out, you'll enjoy living off a big paycheck throughout the year but then owe the government big $$$ at tax time. Either way, it's not ideal. It's best to fill out your W-4 carefully and accurately so that you get just the right amount of money to keep!

Until early 2020, you had to claim personal allowances on the W-4 in order for the IRS to decide how much to withhold. Now, though, the form was remade to be simpler. They will ask for personal information such as address, filing status and social security number. They will ask if you (including any spouse) work more than one job, if you have dependents, and if you think they need to withhold any more money for any reason. You would only say yes to that last question if you know of dividends or self-employment money that will be flooding in soon.

Decide on your automatic savings

Before you see a penny of your paycheck, make a budget and choose how much you want to send into retirement or savings accounts (10% minimum! I mean it!). Estimate your paycheck after taxes for a more complete picture.

While you likely can't set up direct deposit from a paycheck that doesn't exist yet, you can make hard decisions without any external pressure or impatience. Write down on paper how much of each paycheck you're going to save, and bring it with you to work. Follow through when you have to actually give the number to HR or your work computer. You thought it through and did the calculations, don't second-guess yourself.

Follow these steps to be a first-day superstar. Your money will be piling up in no time!

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