Jimmy’s Table PodcastCuriously evangelical. Politically homeless. A dreamer of small things. On this podcast, I am having conversations about the intersection of faith, life, and culture.

How I Gave Myself A $4,320 Raise This Year -Episode #79

Show Me The Money

Getting a raise from your employer can be hard. At a lot of larger corporations, it’s not really possible to negotiate a larger annual salary. Apart from getting a promotion or taking a job with another company, most major corporations run a pretty tight ship. Your immediate supervisor will have little influence over your salary.

Increasingly, your salary is decided by HR and mid-level managers, whom you will likely never have the opportunity to really ask for a higher salary. If you really have good numbers, and your manager gives you an excellent annual performance review, you might be able to get an extra percent increase in salary above the rate of inflation. But anything beyond that will be outside of your ability to influence or negotiate.

As a result, you’ll need to come up with other ways to get a raise outside of work. You’ll need to give yourself a raise. And in keeping with the old motto coined by Benjamin Franklin, “A penny saved is a penny earned,” in today’s podcast I want to talk about several different ways you can give yourself a raise… and likely, a pretty substantial one at that.

Recently my wife and I took an inventory of our bills, and we found ways to save an extra $360 per month. I’m not sure about you, but $360 a month is REAL money to us. That adds up to $4,320 a year in savings, which is a lot more money than we could hope to receive from annual salary increases at our places of employment. And we are still looking at several other areas to increase our savings.

In today’s podcast, I talk about the 9 different ways you can help give yourself a raise. Listen to the podcast above for a full discussion of the items below.

1. Refinance Your Mortgage

According to FHLMC, as of September 24, 2020, the current average 30 year fixed mortgage interest rate is 2.9%. This rate is at near historic lows. If you own a home, I would encourage you to talk to your bank or mortgage company about refinancing your current mortgage. My wife and I recently did this and managed to reduce our monthly mortgage payment by over $200 a month.

2. Cut The Cord And Ditch Cable

Instead of using cable or satellite TV services, consider streaming alternatives such as Sling, HULU + Live TV, or YouTube TV. It was costing us $117 a month in cable. We’ve switched to YouTube TV, and now only pay $65 a month. YouTube TV streaming services gets us about 95% of the cable channels we used to have, as well as all our live local channels. It comes with unlimited DVR and we can watch TV on all our personal devices in addition to physical televisions.

3. Get Rid Of ADT And Use Ring For Home Security

We have a personal home security system. For years we’ve used ADT. But recently I’ve become aware that ADT is a dinosaur that deserves to go extinct. It was costing us $65 a month for monitoring services. We recently ditched ADT and switched to Ring, which costs $100 per year for our monitoring service. The only major expense is the gear you’ll have to pay for up front out of pocket..

4. Adjust Your Annual Mileage For Auto Insurance

Now that I’m working from home full time, I won’t be driving very much. I’ll probably drive less than 5,000 miles a year. As a result, I called in my auto insurance carrier up and let them know. This reduced my premium by $50 per 6 month period.

5. Pay Your Bills On A Credit Card With Cash Back Rewards

As long as you can use your credit card without carrying a balance and getting charged interest, using a credit card to pay your monthly expenses is a great idea. We have a credit card that gives us at least 1% cash back rewards. We pay for everything on this card except our mortgage. As a result, we get at least $30-$40 a month in cash back rewards.

6. Eat Out Less

I’ve worked in the mortgage world for roughly a decade. At times, I’ve had to crunch how folks spend their money. Most people throw away small fortunes simply for the luxury of eating out. I once ran the numbers on a family of 4 who spent over $1,000 a month on eating out. And they weren’t eating out anywhere fancy. It was a lot of money spent at fast food chains. Everyone’ scenario is different, but if you were to look at how much you actually eat out in a given month, you could easily save a few hundred bucks a month, without even trying. Save money by eating out less.

7. Prepare Your Meals Ahead Of Time

My wife and I have been doing this for years. Every week we make a list of meals we’d like to prepare for the week. We get super specific. For example, we say on Monday we are having chicken with vegetables, then on Friday, we are making pizza. We often look to make foods that we know will yield some sort of leftovers that we can eat for lunch one day, or freeze and eat again another time. In winter months, we love to make lots of freezer friendly meals like soup and spaghetti sauce. It takes a little effort, but it’s an effort that goes away. Cook at home. Prepare your meals ahead of time. And if you don’t know how to cook, learn. The internet has made it impossible for people to not know how to cook. My wife and I even have started making some food cooking videos on YouTube.

8. Invest In Dividend Paying Stocks

Everyone’s financial situation is unique. But after making an emergency fund and saving for retirement, once you are ready to begin investing, you might want to consider purchasing stocks that pay dividends. Savings accounts are trash. Gone are the days where you can get a 5% return by just leaving your money in a savings account. You are lucky to get anything over 1% these days. With inflation usually being between 1-2% a year, your money in your savings account is practically being destroyed by inflation.

However, there are still a lot of ETF’s and mutual funds that have very attractive yields, and pay handsome dividends that mirror savings accounts of old. If you don’t mind putting some of your principal at risk, you might consider investing in various bond funds, REITS, and utility companies. If you have $10,000 to invest, a fund that yields 4.5% in annual dividends will earn you an extra $450 a year before taxes.

9. Automate Your Savings

Don’t forget to automate your monthly savings. It’ll help you hide money from yourself instead of spending it. Set up a savings account at a bank, ideally, one that isn’t tied to your checking account. And every month, set up automatic transfers to those accounts. Over time, you’ll manage to slowly save a lot of money, without even trying.

(Disclaimer: I am not a Certified Financial Professional, and I do not speak on behalf of my employer. Please consult with your Certified Financial Professional, Accountant, or Lawyer before making any financial changes in your life. These are simply my personal opinions and the things I am doing in my own life. What you choose to do is ultimately up to you and your trusted advisors).

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