Perhaps 2013 has been a financial struggle for you. Maybe you are in debt and struggling to pay it off. Perhaps you don’t have an emergency fund but know you need one. Maybe you haven’t started a retirement account (outside of the money you have contributed for you by your employer). Or, perhaps you haven’t started a college savings account yet, and each year that your child gets older you worry more about how you’ll pay for college.
If one of these scenarios sounds familiar, realize that you’re not alone. Many, many Americans feel this way.
However, one of the solutions might be easier than you think–assign a job for your extra money.
Where to Find Extra Money
What? You don’t think you make extra money? I beg you to think again. You likely have extra money coming in but you just don’t look at it as extra money.
If you get a tax refund, that’s extra money. The same with any refunds you get or discounts you receive when you use a discount code or a coupon. If you have a side hustle, that’s extra money.
The simple fact is, if you pool all that money together and give it a job instead of simply absorbing it into your standard budget or using it to splurge, you’ll be looking at a significant amount of money.
Don’t believe me?
The Powerful Impact of Giving Extra Money a Job
Consider Julie from The Family CEO who documents “found” money. From July through September 2013, her family “found” $7,113.37 dollars. Some of this money went to her family’s emergency fund and some of the money went to pay for her daughter’s college education. (She and her husband have been able to pay cash for their daughter’s education using this strategy.)
If you separate out extra money you receive and give it a job, the impact can be astonishing. Even if you don’t find $7,113.37 in extra money like Julie did, you likely have more extra income coming in than you realize.
Likewise, Erika from Newlyweds on a Budget documented how she made over $20,000 from her side gig, which was instrumental in paying down a large portion of her and her husband’s debt. Even better, she was able to use a large portion of that money to pay for fun vacations including a honeymoon trip to Costa Rica, as well as a trip to New York and Seattle and weekend trips to Las Vegas, Temecula, San Francisco and San Diego. Because she assigned a job to her money, Erika was able to both have fun and take vacations, which is very important to her, as well as pay down her debt.
How to Get Started
Before the new year, decide what you want to do with your extra money. You could use it all for one goal like paying down debt, or you could use it for two goals, such as 50% for a house down payment and 50% for paying down debt. You decide. And when that extra money starts coming in during 2014 (and it will, trust me), put the money to your designated account. You’ll enjoy watching your financial situation improve month by month.