So you’ve made it to the end of Phase 2? Congratulations! If you’ve come from Phase one, you’ve pushed the boulder all the way up the mountain, pushed it over the hump and started the boulder rolling down hill. Phase 3 is going to add some muscle to your boulder push and will accelerate your process to the end; true financial wealth.
There’s a problem though. Up to this point, you were able to take your buffer margin and roll it into the next step. If you had an extra $500.00 per month going towards your first $1000 saved (simple step 1), you could take that $500 and use it towards your credit card debt (simple step 2), your consumer debt (simple step 3), your emergency fund (simple step 4), your retirement savings (simple step 5), and finally 10% personal savings (simple step 6.) Now, the 10-15% retirement savings and the 10% personal savings can’t go with you into the next phase. Something’s gotta give. I can picture Spencer Pratt from the Hills saying, “That’s the problem.”
"That's the Problem"
What to do? What to do? As we’ve previously discussed, in order to create more margin/buffer, you must either raise your income or lower your expenses. If you are like me in this phase, I am sick of lowering expenses by now. I have had a really crappy car and really crappy phone for way too long. I’m okay with that, but I just don’t have room to get any crappier. I’m sorry, Mom, for using that word. I know, we don’t say that word. (But I’m typing it..hehe) But it’s true. I am left with no other choice. I choose to raise…income.
Here are a couple ways to raise your income.
Start a side business
Work Part Time
Get a Raise at Your Own Job
Get Promoted at Your Own Job
I will go into each in more detail at a later time, but all four are feasible ways of increasing your income. Once you get into Phase 3, you will realize that the remaining steps are not very difficult to achieve. I’ve figured that we will need an additional 7% income to reach Phase 3, Step 3. Again, we’re not going to go back working 2-3 jobs like we should in Phase 1, but we are confirming our financial success do doing a little extra and going above and beyond.
If you are ready, (I hope you had a good celebration from the Phase 2 victory) let’s begin Phase 3.
