I get sceptical too when I see the word “guaranteed” in a link. There’s bound to be a catch or it’s probably going to lead to one of those websites that open a thousand pop ups promising weigh loss miracles or others selling Viagra. I’ll admit that my choosing to use the word is a little gimmicky and you’ll see why by the sixth paragraph or so but for now, you’re still reading so at least I haven’t lost your attention yet.
The economy is biting hard, we all know that. Individually and in groups, we’ve at one time or the other brainstormed about how to make more money through side gigs or some business idea you can start. Some people have successfully implemented their ideas while some others are still brainstorming but the reality is, all this while, we have been focusing exclusively on finding other sources of income, when our first income stream hasn’t been fully maximized.
So let me ask you, “If your salary doubled next month and every month after that, what would you use the money for?” That’s right, I meant that your salary would double every month … hundred next month, two hundred the following and four hundred after that. I think you should take a moment to get a calculator and actually add up what your pay would be and dream for a minute. It’s ok, I’ll wait.
Welcome back. Now that you’ve realized that after a year or maybe two, you would have more money than you could ever spend and it’s still multiplying, what would you buy? What most of us would do is start accumulating “stuff”. A bigger house, a new car (or cars), travel, gadgets, the usual “stuff”. Some others might derail completely, start living alternative lifestyles and lose their grip on reality all together. Both scenarios are quite normal; we all have needs, wants, etc. and we will satisfy them whenever we have the resources. In the real world though, someone just doubling your money every month is very unlikely to happen.
What is more realistic but still on the edges of fantasy for most, is the inflation adjusted pay rises some companies pay out every year. I once worked for a company that did this. I had heard that some companies did it, I just never believed it would ever be my portion. It was great. The increase was never huuuge; inflation at the time was just under 10% and these guys increased our salaries by just under 10% every year. What happened every year though is what always happens. My expenses caught right up to the increase and I was back wanting and needing again. The point is, pay increases are nice, but it’s a change in lifestyle that will really make a lasting difference in your life.
This is where I might lose some of you. If you click the back button after reading this section, bye, bye! Thanks for dropping in. Please come back soon for new posts and don’t forget to like and share on social media. So here it is. The guaranteed way to increase your salary without a pay raise is, … “control your expenses. Quite simple really and probably not what you were expecting. If you earn a hundred thousand a month and you typically spend ninety nine thousand, reducing your expenses to say, eighty thousand, by “cutting the fat” means you’ve” effectively increased your pay by nineteen.
The hardcore cynics are reading this and thinking, “If I save nineteen thousand, won’t I still spend it anyway?” True, you will send it but I bet you wouldn’t go nuts like you would have if your salary doubled every month. In this case, you would have a plan for that money. You would prioritize your wants & needs and you wouldn’t just hand it over to anybody. You could finally pay off that debt hanging over your head or save and invest in something that earns you another stream of income.
Some who are still reading might be thinking, “How the hell am I gonna cut down expenses from ninety nine to eighty if I spend more than I earn most months anyway”. Well, there are expenses that you incur right now that you think you can’t live without but in reality, you lived without them before and you can again. There are also some “little foxes” that you think are insignificant but they add up over the course of a month.
The first step is to start tracking your expenses. I’ve been doing this for years and the insights are incredible. The humble rice, chicken & coke that I bought during my lunch breaks (before I started packing breakfast and lunch from home) cost one thousand and change depending on whether I wanted coleslaw or moi-moi or both (‘see no evil monkey’ emoji) but added up over 4 weeks to about thirty grand. Back then, thirty grand could buy a whole lot of baby formula.
Your Netflix subscription may just be three thousand a month but when you add it to your DSTV bill and monthly internet subscriptions, you’ll realize that you spend quite a bit on entertainment. Prioritize and cut the fat. You don’t need to have 24/7 access to all those movies and programs. It may be a little inconvenient, but identifying and controlling these little foxes in your expenses can go a long way to increasing your pay.
Another thing I’ve cut out of my expenses (as much as I can) is expensive foreign drugs. Believe me, the locally made generic cough syrup is just as good as the imported ones. Do your research and get to know the active ingredients in the drugs you buy and ask for it by name. You will be surprised how much you save.
Step two is to budget effectively. In my monthly budgets, I have a category I call non-discretionary expenses. These are expenses that I have to incur every month whether I like it or not. 40% of my pay went into this category monthly and try as I might, I couldn’t reduce it, after all they were non-discretionary. I had to pay my power bill, I had to pay the guy who helps me around the house and so on. Well, did I? When I finally had enough of the guy’s sticky fingers a few months ago (making away with small amounts of food and money that he thought I wouldn’t notice), one day, he went too far and stole a six pack of beer. I mean that’s a line you just don’t cross. So, I fired him. I haven’t hired anyone else, just a guy who comes in twice a month to clean and now, that non-discretionary fifty grand I used to pay is allocated to other productive categories. Overall, this past few months, I’ve cut this “un-cuttable” category by almost 5% just by being brave and doing away with what I thought were necessary but were really luxuries,.
Enough Talk, Act Now
Please go ahead and create additional streams of income for yourself. It’s the right thing to do, however, you are likely to end up in the same boat when your expenses catch up to your new income levels. Give yourself a pay raise by controlling your expenses.
Start tracking your expenses. You can start by not deleting your SMS bank alerts and reviewing them monthly. Second, do a full written budget for your salary every month and allocate cash based on what is important.
Also Read: Is it Possible to be Recession Proof?