Everyone wants to make more money. Learn 3 simple strategies to increase your income and manage your money so you have more financial security-and more money in your bank account.
Money Girl
201 MG How to Make More Money in 2011
This episode is brought to you by AARP. Ten years from today, Lisa Schneider will trade in her office job to become the leader of a pack of dogs. As the owner of her own dog rescue, that is. A second act made possible by the reskilling courses Lisa's taking now with AARP to help make sure her income lives as long as she does. And she can finally run with the big dogs. And the small dogs, who just think they're big dogs. That's why, the younger you are, the more you need AARP. Learn more at aarp.org/skills. Imagine earning a degree that prepares you with real skills for the real world. Capella University's programs teach skills relevant to your career so you can apply what you learn right away. Learn how Capella can make a difference in your life at Capella.edu. Hi, friends, and welcome back to Money Girl's Quick and Dirty Tips for a richer life. I'm Laura Adams. We're getting closer to the new year, and you know what that means. It's time to make some resolutions to improve your personal finances next year. Don't worry, it doesn't have to be difficult. You might be surprised at how easy it is to make a few small changes that can transform your financial well-being and give you more security. In this podcast, I'll give you three great ways to make more money next year. There are three basic financial strategies that you can use to make more money in the new year. Number one, increase your income by managing your career more proactively. Number two, earn more interest by managing the money you already have more efficiently. And three, invest more by refining your spending plan and cutting your expenses. Those sound pretty generic, so let's get more specific about each strategy so you can apply them to your situation. Even in today's tough job market, one of the best ways to increase your income is to ask for a well-deserved raise or promotion. You may be working longer hours to cover for laid-off employees and could have picked up some new skills along the way. Compare what you're making to average salaries or wages in your field and don't be timid about speaking to your boss if you believe that you should earn more. Discuss what you've accomplished for the company and remind your employer about the value you bring due to your education, industry experience, personal connections, or time on the job, for instance. If discussing a raise with your boss feels a little awkward, just remember how beneficial it can be for your financial future. Here's what I mean. If you negotiate an additional $3,000 per year, that's an extra $60,000 over the next 20 years. If you invest the additional income in a retirement account, like a 401k or an IRA and earn 7% on average each year, your raise would swell to $123,000. Having more income also allows you to collect bigger social security checks every month after you retire. When your income is tapped out in your current job, speak to your boss about potential promotional opportunities. If they just don't exist where you are now, search for a more lucrative position, or start hustling on the side at a second job. How about creating a part-time business? Consider what skills you have that other people need, like house painting, computer work, pet sitting, tutoring, music lessons, yard work, writing, shopping, house cleaning, bookkeeping, and so on. Becoming a part-time entrepreneur is a fantastic way to earn more and could even lead to full-time work that you're really passionate about. However, you might be relieved to know that you don't have to work multiple jobs in order to make more money next year. The second strategy that I mentioned is to earn more interest on the money you already have. For instance, if you have bank accounts that hardly pay any interest, it's time to make your money work much harder for you. Search for free, high-yield checking and savings accounts at sites like depositaccounts.com and checking finder.com. If you earn 4% on an account that averages $15,000, you'll have an extra $600 in your pocket each year. If you invest your earnings for a modest return, it could grow to $25,000 over 20 years. Another way to earn more interest is to pay less interest. If you're carrying a balance on a credit card that charges 17% interest, for example, paying it off is just like earning 17% after taxes. So don't underestimate how beneficial it is to eliminate high-interest debt, like credit cards, retail store cards and payday loans. This episode is brought to you by AARP. Ten years from today, Lisa Schneider will trade in her office job to become the leader of a pack of dogs. As the owner of her own dog rescue, that is. A second act made possible by the reskilling courses Lisa's taking now with AARP to help make sure her income lives as long as she does. And she can finally run with the big dogs. And the small dogs who just think they're big dogs. That's why the younger you are, the more you need AARP. Learn more at aarp.org/skills. Earning your degree online doesn't mean you have to go about it alone. At Capella University, we're here to support you when you're ready. From enrollment counselors who get to know you and your goals, to academic coaches who can help you form a plan to stay on track. We care about your success and are dedicated to helping you pursue your goals. Going back to school is a big step, but having support at every step of your academic journey can make a big difference. Imagine your future differently at Capella.edu. Curious how equity compensation can help build employee financial confidence and move your business forward? Tune in to the latest episode of Morgan Stanley at Work's Invested at Work podcast, where we explore the power of financial benefits and how they can help your employees in the workplace and beyond. Listen now by visiting morganstandley.com/investedatwork or stream on Apple or Spotify. Because we believe that when employees thrive, your company thrives too. Again, visit morganstandley.com/investedatwork to listen today. The third strategy to make more money next year is to invest more money. The first step to investing more is to create a budget or what I prefer to call a spending plan. In my new book, Money Girl's Smart Moves to Grow Rich, I tell you exactly how to set up a realistic spending plan so you know where your money is going and can carve out a bigger chunk of your discretionary income to set aside for the future. I recommend using a free online financial application like mint.com to easily import and track your expenses from accounts at banks and credit card companies. Mint allows you to set a budget for each of your spending categories like groceries, dining out, clothes and utilities, and to get spending alerts so you always stay on track. A smart move is to invest at least 15% of your income for the future. So make a resolution to pump up your savings rate. Even boosting contributions to a retirement account by 1% each year is a savvy habit that will really pay off over time. If you use each of the three strategies that I discussed to earn more income, to earn more interest, and to invest more discretionary income, you'll have what it takes to really get ahead and build serious wealth for your future financial security. As I mentioned at the top of the show, I'm giving away a free special edition ebook called Smart Moves to Deal with Your Debt. It's loaded with great ways to attack your debt no matter how much you owe. It'll help you assess your financial situation, learn which debts to pay down first, negotiate with creditors, boost your credit score, and lots more. Download it from Amazon.com, Barnes & Noble, or in the Apple iBook store. The free ebook also includes a chapter from my new book, Money Girls Smart Moves to Grow Rich, where I cover the whole enchilada, including investing, planning for retirement, buying real estate, managing money with modern technology, reducing taxes, saving money, and all the other things you really need to know. It's available as a paperback or as an ebook wherever fine books are sold. It's the perfect holiday gift for you or someone on your list. I'm glad you're listening. Cha-ching. That's all for now. Courtesy of Money Girl, your guide to our richer line. Earning your degree online doesn't mean you have to go about it alone. At Capella University, we're here to support you when you're ready. From enrollment counselors who get to know you and your goals to academic coaches who can help you form a plan to stay on track, we care about your success and are dedicated to helping you pursue your goals. Going back to school is a big step, but having support at every step of your academic journey can make a big difference. Imagine your future differently at Capella.edu. Curious how equity compensation can help build employee financial confidence and move your business forward? Tune in to the latest episode of Morgan Stanley at Work's Invested at Work podcast, where we explore the power of financial benefits and how they can help your employees in the workplace and beyond. Listen now by visiting morganstandley.com/investedatwork or stream on Apple or Spotify. Because we believe that when employees thrive, your company thrives too. Again, visit morganstandley.com/investedatwork.com to listen today. [BLANK_AUDIO]