How to Make the Most Out of a Pay Raise

Pay changes (or getting tax refunds) are a great time to re-evaluate your budget. Yes, the whole thing... why are you still paying for that membership if you don't use it? This has always been Step 1 for me. Step 2 is to pay my future selves (yes, in the plural) my old-hag-self who is retired and recalling the days when gas was only 2.81 a gallon; my future self who needs to replace the roof, the car, or braces for the kids (or all at the same time); and my tomorrow self who (hopefully not) has lost her job and can't find one for 6 months. Step 3 Evaluate outstanding debts. Due to a lot of lean years, the only debt I have is the mortgage (yes, I still do the happy dance on that thought). If you have debt, PAY THEM OFF in order of bad debt to good debt. Step 4 Evaluate your back burner needs. I again have three piles based upon general cost per item (small, medium, and OMG, I won the lotto) and they are all written down (so I stay on task). Step 5 Celebrate your success and share with others! I always use a little of my extra $$ to get my happy on. Wether it is going to Disney or writing a check to your favorite charity - do something that puts a smile on your face.

Bee & Co of CT 5:01PM July 14, 2010