How To Give Yourself A Raise In ANY Economy
courtesy of johnr71
Recently I made a guest post on Adam Baker’s brilliant site, “ManvsDebt.” Overwhelmed with the amount of positive support his readers gave me, I went out and leased a brand new bad ass candy apple red Ferrari (just kidding).
No seriously, what happened was, I became 100% debt free (giving myself an approximate $350/month raise).
So what’s the easiest most effective way to give your own self a raise in ANY economy. You got it – pay off your fucking debt people!
Although it might not seem like much of a raise to some, it was for me. Not only that, the psychological and emotional impact it has had on me, is probably one of the most life changing events I’ve ever personally experienced.
It’s also one that I truly wish everyone has the chance to experience one day. As someone who has helped a few close individuals through this, perhaps I can share a bit of my story to help you unchain yourself from the ahole bankers who are seriously laughing their ass off because YOU don’t get it!
Below are a few simple unconventional insights that I hope might help you or someone you know overcome a similar feat.
If you can’t afford to pay cash for something, you don’t buy it – this goes for both your business or personal life.
I know it sounds simple, but this was the one thing I never really learned or was taught by anyone (go figure). Although the people I was around, the billions spent by advertisers per year in convincing me that, “Get it now, pay later” was the right things to do… they were fucking wrong!
Cut up all of your credit cards and leave the debit cards home! You spend less when you go into a store with 100% cash. Not only that, you find deals you never saw before because you can only spend the cash you have in your hand. What a new concept, huh?
Since I got my girlfriend Kelly on this plan, she’s been able to cut her credit card debt in half (already paying off over $30,000 just in credit card debt)!
It’s true I had to do some mind trick ninjitsu work on her… but I’ll never forget the time when she actually understood this.
Kelly went into Target with about $25 cash. She got a christmas tree, the stand and a few other things… she was so excited and understood “I can work with a budget.”
The crazy thing was, she used to go into a store and just get whatever she needed (never considering the price). Now she has to consider the price because she goes in with cash – already knowing what she needs and what she can spend.
Is this not the easiest most brilliant thing to do?
No car payments, or fleeces (what some call “leases”).
A “lease” is such a great business model anyone in business should use. It’s fucking brilliant!
Think about it. You borrow a product that you don’t own, pay someone hundreds of dollars a month to use, then give it back to them in 2 or 3 years (signing a contract that they will get paid on a certain date each month or else they will sue your ass).
Brilliant business model BMW (but scam someone else)!
If you are at a store and you find something you need, put it on hold if you don’t have the cash. This relieves any/all “impulse buys.”
This is probably the one of the smartest little tricks I’ve learned. Because I only carry cash on me if I know I’m going to buy something (and don’t own any credit cards), I go home to see it if I have it in my envelope. Not only that, I start asking myself, “Do I really need this?”
Remember, not “do I want this?” BIG difference.
Other than buying a house in the next few years – which would most likely be paid for in cash (or a 15 year fixed rate at 25% of my take home pay), I’m now 100% confident that I’ll never need another stupid loan or credit card EVER again to live on.
Although it’s one thing to pay off your debt, it’s another thing to do it and be in 100% control of your finances. For this, I have my “ultimate” mentor to thank for introducing me to Dave Ramsey’s plan and standing behind me in this personal quest of debt annihilation.
I know this might sound a bit “unconventional” to live this way. But when “conventional” is being in debt up to your eyeballs, unhappy, living “pay check to pay check,” depressed, and working a soul sucking job because of the “great fucking benefits,” I don’t know about you… but… “unconventional” just seems like the smarter way to go. Don’t you?
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My hat is off to you. Fantastic accomplishment and incredible wisdom plus the guts and fortitude to do it. How did you make that decision? I will be most people thought you were crazy.
Thanks so much Ralph. You know… I made the decision (again) in about 2006 because of how I saw my girlfriend handle her finances. Also, when you hear all of these things about bankers living these lavish lifestyles with “the economy,” it honestly made me sick to know that I was contributing to that. Plus, I really do consider it “legalized slavery.” Funny, you mentioned that “most people thought I was crazy.” You know, those people are still in debt OR declared bankruptcy, so I would MUCH rather be looked at as “crazy.” Honestly, without the help of my mentor introducing me to Dave Ramsey, I would probably still be in debt.
Tremendous breakthrough in personal responsibility
Thanks Joe. It IS a huge breakthrough in personal responsibility.
Great article. Congratulations. I’ve learned many of these tricks, but sometimes I don’t use them like I should. Great “kick in the butt” to stay on the right track. Love the envelope system – it is so powerful. Peace,
Thanks Sheila. It is really great to know that someone else is on a similar path. Sometimes all it takes is for someone to remind you of what you already know. Cheers.
All good points here.
What’s working for me: Paying cash for everything. In fact, I don’t own a credit card.
What’s not working for me: Allowing my Home Equity Line of Credit to get out of control. It’s like having a second mortgage. When I get that sucker paid off, I will never use it again.
Right on Alex. I don’t own any credit cards either. Dave Ramsey’s site should be able to direct you on what to do with that mortgage.
Good advice Jared.
I did something a bit different in my life. As friends around me were getting credit cards in our teenage days, I forced myself to wait until I was well into my 20s. This allowed me to really understand the system and get a feel for how it worked.
When I figured out I could get credit cards that pay 1 or 2 percent cash back, I went out and got one and made sure to only buy things when I had the cash in my bank account.
This way I’ve was able to actually make some money by using my credit cards.
A warning though, you need some strong will power to pull this method off.
It’s been about 6 years later and I’ve never paid a dime of interest.
Hey Mike,
Thanks for checking out the blog and commenting. You have an interesting point.
I’m honestly not sure what to say about that method your using. I think it’s great to pay that off, but why not just use cash? And what about those times that you lose your job or are short one month… what do you do then? When you pay cash, it’s already bought – then you can lose your job and no matter what happens… whatever you bought is AND always will be yours.
This is what happened with the housing problem in the US. People thought, “Oh I can afford it.” Sure, they could, they had a job. Then they lost their job and couldn’t afford it – they weren’t prepared (using a similar philosophy). See what I mean?
I’m on your side Mike – the banks are not!
Know what I mean?
Good point Jared.
I guess I’m a pretty frugal purchaser anyway. I’m not a big fan of buying stuff, and I’m sure my method probably wouldn’t work for everyone.
Although it is nice to see that credit card bill at the end of the year and see that Visa owes you money!
But I agree, carrying cash would be the easiest method to spend less.
Good thing Mike. I was seriously going to have to take out my can of woop ass. LOL! Just understand the banks know what they are doing. They want you to use your credit card (for that reward at the end).
In the short term you might win. In the long haul, usually the banks do. But don’t believe me, look at most of the tallest building in the world (they’re banks). Not to mention the fact that, I don’t EVER want anyone going through what I had. Keep on rockin Mike! And when you get a chance, check out http://www.daveramsey.com – he’ll be able to answer any other questions on this you might have.