Finances & Money Frugality Taxes

Our secret to success: Part Three: Earn More

This article is part of my “Secret to Success” series. Check my index article to see where it all started and for the other four parts!

For many, including myself, we find it much easier to reduce our spending than to earn additional income. Whether it’s limited availability of jobs, skills, motivation or financial backing, there’s always “something” that gets in our way to gaining higher pay or side-income. Some people are introverts, some are extroverts. Some need to plan everything, while others have a “Just Do It” mentality.

But regardless of your perceived capabilities and limitations, you do have at least one marketable skill; sometimes you just need the confidence that you can ask for that raise or start that side business.

How to Earn More Income

No one is going to become wealthy by keeping the same exact salary every year of their life. Inflation causes the cost of goods and services to constantly rise. “Lifestyle inflation” also causes the need for more money. For example, you want a bigger house, more/newer gadgets, nicer/more exotic vacation, etc.

Basically, there are two ways WE have tripled our income since college:

  1. Increased salaries
  2. Side business income

Increasing our salaries

Each year, I get a social security benefits mailing which details how much I’ve made (according to tax returns) since I first job. It’s interesting watching my income grow every single year (except one in college). When I was 15, I had a paper route and then moved on to a job at McDonald’s (with a work permit since I wasn’t 16 yet). My parents didn’t force me to get a job; rather, I wanted one. In that year, I pulled in about $600. I was rolling in dough!

Over the next few years, I progressively increased my income either by working more hours or getting pay raises. However, these raises were mostly from increases to the minimum wage rate (I started when it was about $4.25/hr). It wasn’t until late college that I started getting more than minimum wage.

In college, I went back to working at McDonald’s, mostly because they were paying $6.50/hr ($1 more than minimum wage). By the time I left after 2 years, I was up to $7.25/hr, but then I took a paycut to become an office manager of a women’s clothing store (imagine, the only guy in a store full of college-age women workers!). By the end of college, I was pulling in around $4000-$5000/year, but I was spending much more than I earned.

Luckily, in my first job out of college, I got a salary about 10x what I was making before! But did my spending slow down? Only slightly. I spent $3,000 on new furniture, ate out for lunch almost daily and traded in my brand-new Saturn L300 in for an even newer Acura TL-S, losing $6500 in the process.

Once in the professional world (i.e. out of college and part-time jobs), I was pretty happy with my first few raises. In the first year, I got a 12% bump, and then 8% in my second year. But then the money started drying up. In my third year, I got a 4% raise, and in my final raise, I only got about 2.9% (which was on the high end for our department). And this was a Fortune 100 company with record profits year-over-year! I had a feeling things would only get worse, so I made my move.

Within the realm of a salaried job, there’s only a few ways to increase your income:

  1. Ask for a raise
  2. Hope for a raise
  3. Change jobs (but ask yourself why you’re switching jobs first)

I’ve never had to ask for a raise, but I did hope for one because in that job, I ended up on a 15-month pay raise cycle in year four, but I had no idea how long I would be waiting till I finally got the raise. So instead of constantly waiting every 15 months or so, I decided to go for option 3: I got a new job.

Taking a big risk for big rewards (switching jobs)

I’m not the type to take big risks, but I will move to a new job if the timing, pay and risks fall in line with my expectations. So in the spring of 2005, I took (in my mind) a major risk: I left my cushy corporate job for a job 90 miles away. I lived near D.C., worked in northern Virginia, but took a job in eastern Pennsylvania. But since I’m somewhat risk-averse, we decided not to sell the house yet. Instead, I commuted up each Monday and came back Friday. I rented a room in an old converted farm equipment building for about $300 a month, plus internet.

It was just after we bought our first home, and it was the first summer we’ve ever had to maintain a pool (in our MD home). While I got a 14% raise (which mostly went to rent), the distance put a strain on our marriage since the wife was less willing to take the risk and move. In the end, I left the company after just 5 months because they got acquired and our positions were at risk. I found a job in federal contracting near our home in Maryland…and got another pay bump.

After just 7 months, that contract ran out and I moved on to another employer for another pay increase. I finally stayed at this new employer for 3 years and was able to get 2 pay raises in that time. Finally, I decided to leave that company (even though I was up for another raise in a few months) because I was losing skills and not gaining experience. I now work in a university IT department (another pay bump), and I’m finally pretty happy with my job.

But that’s not my only income!

Diversifying your income

Three years ago, when I was languishing in the federal contracting world, my wife decided I needed a hobby. Through the fortune of knowing a wise individual, I got into personal finance blogging. Again, since I wasn’t ready for the risk involved in launching my own business, blogging turned out to be a low-cost, low-risk money making option.

While I started blogging just for a hobby, after a year I was starting to pull in pretty nice side-income. While it’s nowhere near a substitute for my paycheck, it has enabled us to pay down debt much more quickly, as well as take some nice trips and add to our savings.

I’ve diversified into other categories of blogging, but my main site still remains However, I still consider this a hobby, which is why I continue to write for my readers rather than search engines. If I treated it like a business, I probably wouldn’t be able to induce as much of my own personality into the writing as I would like. So truly, I am doing something I really like, and getting paid for it.

As for my readers, if you’re considering creating a side business for additional income or to diversify your income, consider your own risk tolerance. If going out on a limb scares the daylights out of you, then think about dipping your toe in the water with something low risk first, such as blogging. However, I’ll warn you that money won’t come quickly, or easily. While it’s a cheap personal investment in terms of money, the time I’ve spent learning, writing, interacting and networking was/is enormous, as it will be for any serious business endeavor.

How are YOU Earning More?

Now that I’ve told you how we’ve gone about earning more income from salary increases and side-businesses, tell me how you’ve gone about boosting your income, whether it’s asking for a raise, changing jobs, starting a side-business or inheriting a huge some of money (jealous).

Next Up: Manage Your Money!

About the author

Clever Dude


  • Making such a long commute and renting in another city at the same time as carrying a mortgage- that’s somewhat risky sounding to me, not sure I could do it. Glad it worked out in the end for you, though. It’s really true that we need to diversify our income sources. Not putting all your eggs in one income basket – scary to imagine some folks who do.

  • Good topic. While I get an “A” for cutting expenses, my performance maximizing income has been a “C+.” Mainly because for many years, i was uncomfortable or not assertive enough to push for a higher salary, though now i’ve reached that magic age where i don’t give a crap, i just do it.

    You’ve been very lucky if indeed your income has always gone one way: up. Mine peaked about 10 years ago, but after several layoffs, i had to settle for work at a lower salary, and i’m just now at the level i worked at, salary-wise, 10 years ago. I take much of the blame for that myself.

    However, i did receive generous inheritances from my late grandparents, and there was one year i cashed out stock options that were worth about a year’s worth of salary at the time. I invested most of all these windfalls.

    For the past 5 years, i’ve modestly added to my base income with freelance writing working in an industry i used to work in full-time. I leveraged my contacts in that field, and while i don’t think i could make a go of it full time (tried it for a year) it has continued to offer extra $ on the side. But, i’m not a machine and so i’ve had to scale back the freelance work while i work my f/t job.

  • Thanks for sharing this!

    My increases were mainly achieved through changing jobs. While I typically did get raises while staying at the same company, it never really compared to the raises I got when changing jobs.
    I’m only now (again) looking more into diversifying my income. Sure, a blog is one way to go (and I’m also into that), but it really is a slow starter and more often than not doesn’t take you very far income-wise.

    I’m actively looking into gradually easing back into the freelancing world. I’ve done that with considerable success next to my studies a couple of years ago, so I can’t really see what would stop me from going down that road again. The only difference now is that I’ve got some constant bills (and, sigh, debt) that requires a steady stream next to my freelance ventures.

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