Muscle Money: Tricks to Increase Income and Empower Your Paycheck
Slugging it out from paycheck to paycheck? We’ve got some awesome tips on how you can empower your paycheck and increase income.
Way back during the time of Italian mafias, depicted in movies such as the Godfather, a certain concept of realization was very prominent for the earning individual; becoming a made man.
When you’re a ‘made man’, you’ve reached the pinnacle of your career in the gang and you’ve earned the respect of your peers. This means your mafia boss fully trusts you and your men give you their full support.
To get there, though, you’d have to prove your loyalty and get your hands dirty. You know, get things done. From there, you make the money, you get the women, and then you get the power. When you eliminate your competition and contribute to the organization on a grand scale, your supervisors grant you the title.
Once you reach that title, you’re as good as gold. You’ve got your own group. You can call hits on whoever you want. You even get your fair share of turf. With that, comes ridiculous amounts of money. That’s money that’s made without you even lifting a finger.
THE MADE MAN TODAY: INCREASE INCOME
Though getting in a gang today could very much get you incarcerated, you don’t have to go that far to live like a made man.
In today’s society, made men are those with swanky offices with 6-digit figure incomes. These are the people in the country clubs and yacht clubs, enjoying their time while their people do all the heavy lifting. When the profits come in, they’re the first ones with dibs on everything.
Strangely enough, you can also make like a made man and have something else bring in the dough! It’s not that difficult. And yes, you don’t need to go around threatening people and breaking legs to get there. In fact, it’s a lot simpler. You just have to know where to look.
If you’re interested, look no further than the contents of your salary account. Yep. That’s what is going to increase income. You may not be looking at much right now, but in the right hands, whatever you have at the moment could very much turn into lifelong investments that will pave your made man living.
INCREASE INCOME: SOME BASIC TERMS
But before you start becoming a made man, there are a few concepts that you have to understand.
Most people think of big businesses and suited-up people talking about millions when the word investment comes into the conversation. It’s actually simpler than that.
When you take 65php to the store and get yourself a pack of cigarettes, that’s an investment in your temporary entertainment. The same thing can be said about spending 500php on two movie tickets.
In investment is also a purchase of a 1-year gym membership at the local buff club which throws in a trainer for you. That’s an investment in your well-being. Whatever you spend money on is an investment.
This stands for Return on Investment. With that pack of cigarettes, your ROI is a nicotine high. That’s your money’s worth. With the movie tickets, your ROI is an hour and a half of entertainment and probably some popcorn on the side.
On the business side, however, ROI means something slightly different. When money is invested in business, investors look toward how soon the money they spent is coming back to them in terms of profit. They also look at how long it takes for that amount to be generated.
For the purpose of this guide, you’ll be referring to latter perspective.
Increase Income: Savings
To put this into perspective, let’s say you make 15,000php every month. If your apartment rent nets you 6,000 in damages and your monthly groceries cost you 4,000php every month, you’re left with 5,000. Take out your 2,500 daily expenses and you’re left with 2,500.
Technically, that remaining 2,500 should constitute your savings. However, if you go out at the end of the month with your friends and completely drain that amount, then they’re not exactly savings. They then become part of your expenses for that month.
At its very essence, your savings are what you manage to carry over into the following months. If you spend it, then they’re no longer savings by virtue of definition.
Increase Income: Passive Income
If this article has already garnered your interest, then you’re definitely aware of what income is. It’s what you see on your payslip on a monthly basis. It’s the money you make by going to work or operating your business.
Passive income, on the other hand, refers to income that is made without you having to do anything! Yes, that’s possible! Later on as you read this guide, you’ll find ways to make your money grow without you having to put in overtime at work or getting another job on the side.
PASSIVE INCOME IDEAS
This is one of the first avenues in which to look. These ideas allow you to invest your hard-earned money into entities that can make money on an automated basis. That means once you invest, the money will take care of itself!
INCREASE INCOME: HIGH YIELD SAVINGS
In your quest to making more money, start with the things that are already there, like your savings account. If you have a salary account from where you work, then you’re good to go! You’re probably already making passive income; really slow passive income. That’s like 100 to 200 pesos in a year.
It’s not a bad place to start, though. But then again, you could be doing more. Fortunately, that’s already possible with HY Savings. These are accounts that don’t necessarily put your money into anything other than time deposits that grow at an increased rate compared to classic avenues.
The best place to get dibs on these sorts of deals is to talk to your nearest teller. They should have options for HY accounts in which you could be making roughly 1000 pesos in just a few months.
INCREASE INCOME: TREASURY BILLS
For the complete beginner, you can think of treasury bonds as mini-investment opportunities mature quickly. That means you can start expecting a return of your investment in a short amount of time. Not only are they quick; they’re also low-risk!
That means you’re almost sure you’re going to get your money back if it doesn’t grow after a certain period of time. It’s like clockwork money. The funny thing here is that they’re not too hard to understand.
As the name implies, they’re from the government treasury. It’s backed by the government. What you do is you purchase them; at a discount! You’re given a certificate of sale to these bills, listing your name in the government ledger. When the bill reaches maturity, the government is obliged to pay you interest for holding onto these bills under your name and money.
Here’s the fun part. You can pick how long you want to wait! There are securities that mature in 91 days and 182 days! You can even nab the whole calendar and get treasury bills that mature after 364 days! Once the bills reach maturity, your investment pays out and you sell the bills back to the treasury for a higher price! Take note, all you did is wait.
Another good thing about treasury bills is that your current financial advisor (or even bank teller) can get you started on investing with these bills! Take note, though, that you might have to take a deep breath as some banks and offers come with minimum purchase amounts. Some of these can go as high as php200,000!
INCREASE INCOME: UNIT INVESTMENT TRUST FUNDS
Although treasury bills may look like a safe route, they’re not the most accessible. Hey, not everyone can set aside 200,000 just for an investment like that. There are those that still have savings but can’t participate in passive-income generation because of the high initial costs.
This is where Unit Investment Trust Funds come in. Now, imagine yourself as a potential investor looking for a good place to make 10,000 grow. Most of the offers your banks will give you mostly require 5 to 6 times more than what you’re willing to invest.
Now what if you could take that php10,000 you’re ready to invest, pool it together with the php10,000 of several other people? With your combined investments, your team becomes ready to play with the big boys! That’s how they work.
You’re given a declaration of your contribution and your investments are pooled together. From here, expert fund managers take that pool and make it grow. They treat it like any other investment placed under their care. You’re looking at returns of php3000 in six months if you invest php25,000! That’s several day’s worth of work without breaking a sweat!
INCREASE INCOME: THE STOCK MARKET
The good old stock exchange. You must have heard about this one or seen it on TV or in the movies. You know, those screaming people in cubicles in nice suits and dresses. People running around with phones one hand and sheets of reports in the other.
The stock market is so big that it has its own section in international news. But what is the stock market and how does it make money for you?
The premise is a little simple, but the rules governing this method are quite complex and require some time to master. Imagine owning a company of your own which you want to expand. You’ve got a good business model but you need more funding to reach your business goals. Here’s where the stock market comes in.
When you take your business to the stock market, you make it go “public”. When a company goes public, anyone interested can buy “shares” of your company. A share is considered a proportional “ownership” of the company. Depending on how big and lucrative your business is, that’s how much it takes to own a certain part of it.
When investors and brokers find your model interesting and think that they want to invest in your company, they buy a certain amount of shares. When your business grows, the value of these shares also increase. That means, anyone else that wants a part of your company when it’s big will have to pay more as compared to when it wasn’t that big. Here, you can sell the shares you already own at a higher price! Thus, increasing your money.
This is how brokers, fund managers, and even small business owners choose to invest their money. They study the economy and make predictions as to what industries and companies are going to make it big in the next few days or weeks. When they make their predictions, they buy shares and watch their money grow along with the business in which they invest!
Now you don’t have to be a big-time business owner or a fund manager to get in on this action. With a minimum of php5,000, you can already open an account with the stock market and start choosing where to spend your money.
INCREASE INCOME: GOOD OLD-FASHIONED THRIFTINESS
If there are new-age means of multiplying your wealth while you sleep, there are also tried-and-tested ways that have always worked since the days of kopong-kopong. The richest of the rich in the Philippines, such as the Sy’s, Gokongwei’s and even the illustrious Ayala’s can attest to how the following bits and pieces of wisdom can change the contents of your savings account!
Increase Income: Setting Saving Goals
You’ve dealt with money before. Sure, you’re an adult and you don’t need anyone telling you what to do with your money. Of course, you know how to save. You’re probably thinking that if you put your mind to it, you could muster a small fortune in savings. You just haven’t gotten to it, right?
You probably haven’t gotten to it because you haven’t set any saving goals. Yes, you need clear goals here too! Where else would you want a specific goal if not with your own wealth??
No, this isn’t an elaborate financial plan with graphs and venn diagrams. This is just a figure. Actually, it’s a few figures.
How much do you want to save every week?
These three numbers will constitute your saving goals. Naturally, when you meet these goals, you end up with a certain amount. You know that feel-good sensation when you look at your bank account and see a lot of money? Multiply that tenfold and that’s how it will feel when you meet your saving goals.
Increase Income: Savings Minus Expenditures
Most people have it the wrong way around. When you get your pay at the end of the month, how do you plan out for the following days until the next payout?
If you’re the type that lists down all your expenses first and thinks whatever is left is your savings, then you’re going about it the wrong way. Ask any wealthy expert and they’ll tell you the first thing that they set aside is their savings.
Yes, that’s possible! Once you get your money, automatically set aside a fixed amount for your savings. That should be the first thing you consider. Once you’ve set aside your savings, play around with whatever’s left. Those are your expenses.
When you start practicing this simple switcheroo, you’ll notice that you’ll be treating money differently. It’s the perfect set-up for this next piece of wisdom.
Increase Income: Controlled Spending
When you’re more active with your saving habits, all sorts of opportunities start to open up for you. The small things you do start to annoy you more and more when you think about them. Going out to lunch at work begins to bother you. Are you spending too much on lunch money?
Instead of congratulating yourself for not being late by adding another piece of chicken or soup to your meal, why don’t you give yourself a larger reward by cooking for yourself? It’s not an outdated method; and it’s not a last resort when your budget can’t allow you to eat out anymore.
If you didn’t have to spend 200 pesos for lunch everyday, you’ve automatically secured 1000 pesos in savings every week if you don’t work on Saturdays! Where else are you going to find 1000 pesos lying around?
The same thing goes for your usual street food merienda or after-work snack right before going home. Take a good look at where you’re spending your money. You will find that there are a few things that you can control.
Don’t get the wrong idea, though. This doesn’t mean you should start penny-pinching on yourself. That’s your money and you can spend it whatever way you want. There’s nothing wrong giving yourself small treats to help ease out the stress of work. But if you can muster the discipline, small sacrifices turn into monumental pleasures through controlled spending. Would you rather eat dinner at a fancy resto every week or be able to take yourself out of the country once by the end of the month? The choice is yours.
Increase Income: Automated Saving
In line with saving more money and restricting cash flow to your spending avenues, one thing you can do is to take out the disciplining part! Did you know that you can talk to your teller (or HR payroll staff) and ask that a certain amount be automatically deducted from your salary and placed into a separate savings account?
When the system starts stepping in and does your partitioning for you, you no longer have to worry about how much you plan to save! It’s already been decided for you. Your only concern now is to make sure that whatever is left makes it to the next payout! That’s one thorn off your back.
With a little common sense and some modern wisdom, anyone can take a small set of savings and turn it into a fortune. But as any wealthy person will tell you, it’s always a matter of discipline and planning. With the right attitude and a little practicality, you’re much closer to living like a made man.
Thinking about ways to Increase Income long-term: check out our article on Understanding Bitcoin