Get out of Debt Now! Increase Your Income!

Get out of Debt, Increase Income
Get out of Debt by Increasing Your Income

This is the second of three articles on getting out of debt:

[Article 1] – Get out of Debt, Budget and Cut
[Article 2] – Get out of Debt, Grow your Income!
[Article 3] – Get out of Debt, Take Action!

In the last article, we talked about creating a budget and cutting your unnecessary expenses. Now it’s time for my favorite part about getting out of debt, increasing your income so you can pay down debt with unstoppable force!

Getting yourself out of debt is no easy task, and neither is making more money. It’s going to take a lot of effort, time, and energy on your part because, unfortunately, money isn’t just given out, it’s earned.

Just remember the reason you’re going through all this extra effort, to finally become debt free. Stay motivated and take some pride in seeing larger paychecks coming into your bank account. Seeing your debt reduce isn’t a bad feeling either!

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Get a Pay Raise

I wish I could say that getting a raise was as easy as walking up to your boss and saying, “Hey boss man, I need a raise!” It isn’t. You’ll probably get “Do some work, and then we’ll talk.” fired right back.

It takes more than confidence and a few words to get a raise. You need to do some hard work and have a strategy.

The truth is, you’re probably getting paid too much for your position. It all comes down to the amount of value that you bring to your employer.

Let’s say your starting salary is $50,000 a year. That means, your company thinks they should pay you $50,000 because they will get a return on investment and not lose money by having you employed.

There are three types of employees to a company:

  • The first employee hires on at the $50k and slacks off, provides little to no value to the business. This employee is currently overpaid because they cost the employer more money just to have their butt in the chair!
  • The second employee provides reasonable value to the company and aligns with the businesses salary range, indicating the $50k is an adequate salary for the work provided. The second employee doesn’t overachieve but does their job without really standing out.
  • The third employee is the workhorse of the company. You know, the guy the business depends on and would be crippled without. This employee is irreplaceable and brings enormous value to the table.

The third employee has power over the employer and will get a raise year after year. Which of the three employees are you?

Remember, your company wants to make money which means they want to reduce costs (your salary) and increase their profits. The more money you bring in for the company, the easier it will be for you to get a raise.

If you want to know more about scoring a raise, check out our article on how to get a pay raise.

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Step up the Overtime

I absolutely hate overtime. In my opinion, it sucks the souls of our employees, who are already pulling huge 40 hour work weeks, for the sake of profit to the company.

Despite the burden of losing time with your loved ones, increased stress and exhaustion, overtime is a good way of temporarily boosting your earnings to pay down debt.

I would recommend doing overtime long enough to get ahead of your debt. I find the best time for myself to work overtime is on my days off because I’m not trying to cram in extra work when I’m already exhausted from a full day.

Start a Side Job

Most people you would consider wealthy never got that way by punching a clock. When you show up to work, you are making the owner of the company rich.

Think about it. If you make $50,000 a year, how much money are you going to make this year? If you guessed $50,000, then you’d be right! You are working for a set wage which doesn’t vary much from month to month.

You need to get a side income, either through a second part-time job or starting your own business. Starting a business isn’t for everyone, so at the very least, consider getting a part-time job and using the extra money to pay off your debt.

You can go freelance if that works better for you, either through an online job board or by advertising your skills on Craigslist. Examples of different jobs you could do include lawn mowing, dog waste pickup, swimming pool cleaning and maintenance, house cleaning, auto repair, and Uber driving.

The extra money you earn from a side job is going to accelerate your debt repayment. It is by far one of the fastest ways to pay off your debt.

What did your Tax Refund go towards?

I love getting my tax return. It was my money to begin with. The government is just giving it back. The problem is most people use their tax return as extra income and waste it!

Use your tax return to pay off debt before you get a chance to spend it on something you want. I don’t want to hear about how you got yourself a brand new flat screen TV with your tax return when you’re $20,000 in debt.

 

Let’s continue to our next article Get out of Debt, Take Action!