Everyone wants to save more, but no one wants to spend less.
Although “spending less” and “saving more” require the EXACT SAME actions, they FEEL very different. One is liberating and draws positive feelings while the other is restrictive and causes discomfort.
It’s funny how our brains work, but that’s the psychology of money.
In my experience, I have witnessed A LOT of people that made “good money,” but failed to save any of it. As their earnings increased, there was always something else that they could spend their money on. This is known as lifestyle inflation. And it’s likely the #1 thing crushing your finances.
In an effort to return to the basics, let me reinforce how simple it is to succeed financially.
The basic steps are:
- Earn money.
- Spend less than you earn.
- Invest the difference.
If you feel that you’re not earning enough money, you’re not alone. And if you don’t know where your money disappears each month, you’re not alone. You’re in the right place because this page is devoted to helping you earn more, save more and increase your cash flow.
Tips and Ideas to Increase Your Income
Stop 401(k) contributions
- An employer match is a nice thing and feels like free money. But, why are you saving for 30 years from now while you’re still paying for things from yesterday? Consider giving up a measly 3% now so you can afford to contribute 15% later. And this is only a temporary move while you’re focused on paying off your debt. Later on, you can increase your contributions.
- Did you receive a large tax refund last year? Probably. Adjust your witholding so your paychecks increase now and stop giving the government an interest-free loan.
Think about the 80/20 rule
- The Pareto principal suggests that 80% of effects come from 20% of causes. Ask yourself which 20% (things you’re doing) is leading to 80% of your results?
Know your worth
- Check out what similar employees with your job title make on Glassdoor.com. Also, entertain those pesky offers from recruiters on LinkedIn and use it as leverage with your existing employer.
Quantify your impact
- Have you completed a task recently that either made or saved the company a lot of money? Remind your Manager of that during your performance review.
- Did you know that only 20% of the things in our closets are worn on a regular basis? Read A Closet Full of Regrets in the Wall Street Journal.
Drive for Uber
- You probably drive around town anyways, why not get paid for it?
Tips and Ideas to Reduce Your Expenses
Stop recurring payments you haven’t used in several months
- Spotify, magazine subscriptions, gym memberships – we all have them
Make homemade meals
- I’m a foodie, so I enjoy eating out as much as the next guy; but drinks and tips are costly.
Review your cell phone bill
- Companies like Sprint and Republic Wireless are slashing costs compared to Verizon and AT&T
Switch car insurance
- This usually pays off every few years. And GEICO has to be able to substantiate their claim to save you 15% in 15 minutes.
- Make sure you’re getting the most of your accounts – No fees, high interest and good rewards.
Review life insurance
- People are living longer and mortality tables change. If you have a whole life policy, you’re paying too much. Switch to a 20-year level term policy that is 10x your income. And you don’t need life insurance on anyone whose income you don’t depend on (ie. your kids).
- Rates have gone up, but they’re still at historically low levels.
Best resources to help you earn more money:
Earning More Money
Become a Better Manager / Employee
Create Passive Income
Make Money Blogging
More Articles to Help You Save More Money:
- You WILL NOT Save More Later
- 10 Ways to Save Money Without Changing your Habits or Behavior
- Are You a Sort-Of Good Saver?
- I’m More Interested in Your Personal Savings Rate than the Interest Rate on Your Personal Savings