Getting a pay bump is one of the best occasions you can have in your career. Instead of immediately changing up your budget to fit your new salary, however, wait a couple months instead.
Photo by photographybanzai.
As personal finance blog Money Ning points out, the change you get in your salary may not be the same as the change to your actual paycheck. After taxes and other costs are accounted for, your raise may be lower than you expect. To get a decent handle on where your finances will be after the raise, wait a couple months before altering your budget:
Is it mandatory you immediately allocate an increase in your income? Are there any negative consequences if you don't? Absolutely not. Unless you have pressing needs, the wisest course of action is to sit on it for a while. Let a few months go by so you can get a feel for your new financial situation and carefully consider all your options. Waiting will often cool the impulse for extra spending and clarify what, if any, upgrades are necessary and beneficial. Seeing your funds accumulate is also a rewarding experience.
Unless you have bills you absolutely have to pay with that raise, waiting isn't going to be that bad. You'll build up a nice buffer, and you'll have a better idea of what your real life budget will be like before you start deciding where you'd like to spend your money.
Four Things to Do When You Get a Raise [Money Ning]