An income problem? What the heck?
Yes, for many folks their problem with managing money well has little to do with their expenses but everything to do with their income.
In my friend Erin Odom’s new book (soon-to-be-released), More Than Just Making It she addresses this problem head on. Because you see that’s the exact problem that her and her husband were once facing and in her book she tells of how they finally rose above that situation.
But here’s the thing, for the longest time, Erin and her family struggled to make ends meet and they kept cutting their expenses until they finally got to a point where they just simply couldn’t cut anymore. Even after receiving some government assistance, they were still struggling to make it work.
That’s where their friend and financial coach came into play. Randy was the first person to tell Erin and Will that they had an income problem and that if they didn’t increase their income then they were never going to regain control over their money.
Here’s the thing, they were living in a townhouse, living on a $200 a month grocery budget for a family of four, and where driving around in Erin’s mom’s car since they couldn’t afford to buy one. The truth is that they were doing everything they could to make their money work for them and not against them but it just wasn’t happening.
And this story is true for many folks.
Many folks are struggling with making their money work for them because they don’t realize that they have an income problem – not a spending problem.
Income Problem vs. Spending Problem
It’s important that we identify the differences of an income problem and a spending problem. A spending problem means that you’re spending more money every month than you make. You’re spending the money on things that are wants and not needs or you’re simply not paying any attention to where your money is going and it’s slipping right out of your hands.
I love this quote from Benjamin Franklin…
I mean how true is this? Every little expense adds up and when you have a spending problem this just keeps compounding on top of itself.
This is different from an income problem because when it comes to an income problem, you’ve cut your expenses so drastically that you can’t possibly cut anymore because if you did, you wouldn’t be able to keep a roof over your head or food on the table. It’s a problem because your income doesn’t cover your bare bones expenses.
So what do you do?
If you find yourself with an income problem, the only option is to increase your income. Yes, I know that this can sometimes be easier said than done but it’s necessary because there is no other option.
Things to consider doing in order to increase your income:
- Take a second job.
- Get creative and work side hustles.
- Take advantage of things like Swagbucks (we use this to pay for Christmas every year).
- Look over your withholdings for your taxes to make sure that you’re not claiming more than you need to for exemptions (if you get a hefty tax return every year, this could be an indication that you’re withholding more than you need to be from your paycheck).
- Don’t be afraid to ask for a raise – have a back up plan in place if they decide to not give you a raise but don’t be afraid to ask. I did this way back when and it resulted in a huge pay increase for me.
Don’t be afraid to ask for help.
If you’ve already cut your expenses as much as possible and are already working hard at increasing your income, don’t be afraid to ask for help. I know that can feel very shameful sometimes but honestly, there’s nothing to be ashamed of. Don’t be afraid to visit your local food pantry if you need to. Don’t be afraid to apply for government assistance if you need to.
Don’t allow pride to stand in the way of getting the help you and your family need. Times will get better. It will take hard work to finally get your money in order but in the meantime while you’re working hard towards that goal, don’t be afraid to seek help.
If you’ve had an income problem before and overcame, please share your story below so we can help inspire and encourage others!
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