Identifying Financial Bottlenecks, And Unclogging Them
When it comes to personal wealth, there are a lot of things which can hamper your forward progress. Even if you’re earning a higher-than-average wage, that doesn’t mean that you should not take care of your financial habits because you could probably be living a much better and relaxed life. You ́ll find plenty of sources online that help high income earners achieve their financial goals.
Some of these tactics can provide you surprising levels of available spending money.
Did you know you can buy a late-model RV just by changing the way you cut your hair? Most people spend $20 to $40 every two weeks getting a haircut. That’s $240 to $480 a year. You could cut your own hair, or only cut your hair once a year, and save between $220 and $460 a year.
In ten years, you’ll have saved enough to buy a used late-model RV. It’ll be a fixer-upper, sure; but you bought it by saving money on haircuts, so who cares? Fix it up incrementally then sell it for a profit and buy a better one. You see the strategy here? Little changes add up over the long term.
Additional Areas Where You Can Save
One of the places where this is most true is as regards taxation, where there are almost always deductions to which you’re eligible which remain in the pockets of the government. TurboTax lists these ten commonly missed tax deductions. If you can save $200 per year on your taxes, that’s $2k in ten years.
Do you have too many loans? Have you financed an ATV, or installed a pool in your backyard that you’re still paying off? Well, first things first: quit taking out loans and pay off what you owe. Secondly, consider consolidation. If you’ve got half a dozen loans with their own interest rates clinging to you, you’re paying in more than you must.
Consolidation of loans combines interest rates, meaning cumulatively you pay less. This is an advisable tactic for many looking to conserve resources. Once consolidation has taken place, you want to pay off those loans as quickly as you can so that you can become financially “positive” again. As a high-income earner, this could simply be a matter of living tight for a year or two.
Combining Savings Tactics
Next, look at your regular spending habits.
Are you eating out a lot?
Going to a lot of movies?
Buying snacks at the gas station whenever you fill up?
Getting a five or six dollar coffee from the coffee shop every day, or smoking excessively?
If you can quit smoking, that will probably save you at least $100 a month, and even help you possibly attain better health insurance cheaper; helping you cut multiple costs at once.
If you can cut out that daily $5 latte, instead making it at home, you can potentially save $1,825 a year (assuming you bought one every day). The same goes for eating out. You could spend $100 and live from that for a week, or spend it in one meal one night. For just a few months or a year, prepare all meals at home and see the savings stack up. Lastly, look at your driving. If you can ride a bicycle to work, you’ll get in shape and save yourself gas money.
Additionally, you’ll reduce vehicular wear and tear, and could ostensibly sidestep the cost of a gym membership while retaining physical benefits of regular workouts. If you don’t live more than five or ten miles from work, this isn’t a bad idea.
Reducing Living Expenses
In short, there are many ways you can conserve resources and become more financially fluid as a high-income earner; and without changing your lifestyle up too much. Still, the more dedicated you are, the faster you’ll see the results you seek.
