3 Things I Did To Increase My Net Worth By 15k
By literally broke
Photo by Paolo Bendandi on Unsplash
I spent last year consumed by personal finance content. I read and listened to so many podcasts and books and blogs that my loved ones wondered if I’d been possessed by some kind of money-hungry zealot.
Why did I need to know about buying a home when I could barely buy a coffee? Why was I paying everyone back in cash? Umm...because I was possessed (in a good way)!
During my personal finance binge I tried a number of methods to save money, increase my income, and follow a budget. Here are the three methods that work best for me:
I Budgeted Every Paycheck
A lot of personal finance educators budget by month or by year. Both options felt way too comprehensive for a budgeting newbie whose income fluctuated on a month-by-month basis.
I had a come-to-Jesus moment when I realized I could just budget the two weeks in between each pay period. Once I knew what my income would be I jotted down any upcoming expenses, allotted a strict limit for my cash budget (more on that later), and put all the surplus towards my credit card debt.
During this time I budgeted exclusively with a pen and paper. Having to physically write out where my money was going each pay period made me think twice about how much I’d allotted for seemingly innocuous expenses like groceries and cleaning supplies (RIP to my candle habit).
I Paid For Everything In Cash
The benefits of paying in cash have been well-documented and lauded by the debt free community. And yes, I agree, paying with cash makes you think seriously about every single dollar you spend.
When I first decided to go cash-only I shredded every single one of my credit cards and deleted their info from Seamless and all the other places I typically drop cash online.
Using only cash was tremendously helpful in making me stick to a budget during these initial debt payoff months. Although it sometimes sucked and I was sad to not be earning points, this time was crucial for me to build better habits and reflect on the value of a dollar, even if I looked (and sounded) like a dad while I did so.
I Automated My Savings
In July 2019 I became eligible for my company’s 401k plan. Although it doesn’t offer a match, I know that building the investing habit would make investing that much easier in the future.
After I received a 13% raise I knew that contributing even just 5% of my gross income would mean less lifestyle creep over the long term. By automating close to half of my raise I was able to invest without feeling the pinch.
Outside of my 401k deduction, I also had $50 automatically deducted from each paycheck and put into my emergency fund. Once I became accustomed to this I increased the deduction to $100. I plan to keep reevaluating my automatic investing and savings every couple of months.
By identifying a budgeting method that worked for me, breaking up with my credit cards, and automating my savings I was able to increase my net worth by 15k in one year!
Side hustles are one of the easiest ways to increase your income and achieve your financial goals. Here are fifteen side hustle ideas perfect for creatives.