I remember how it felt to deposit my first paycheck from my first full-time, salaried job. Have you ever done a spazzy fist-pump dance in front of a sidewalk ATM in downtown Philadelphia? I have. Cool, I thought. Once the machine sucks up that beautiful little slip of paper, my job’s done. I landed the job, put in my forty hours, and got the thing in the bank. The thinking part is over.
Now that I’m out of those hourly-paycheck (or, God help me, retail sales commission) days, I’ve been thinking a little differently to increase my earnings. No more overtime, no more commissions. There’s no way to increase that (beautiful, hard-won, gloriously consistent) little number–unless you’re smarter than the average bear, and you know how to keep working that check after the machine sucks it up. Which I definitely didn’t.
Let me tell you about the time I ended up paying $200 in interest and late fees on a $500 computer that I had financed. With a year of interest-free payments. While I was within $100 of paying it off. Through the job that I was currently working. That’s right, ladies, I handed back half of a two-week paycheck to RadioShack that I had earned selling electronics because I forgot to make three payments of $25, for an entire year, while working at the store I had bought it from.
Every dollar you waste paying interest, or late fees, or other stupid things makes that salary number go down twice– you’ve lost the money, and you’ve lost the opportunity to put that dollar into an interest-bearing account or investment. Or, you can visualize it the way I do, and picture yourself burning money in offerings to the Laziness and Stupidity god. I’m practically their high priestess. The fewer things I leave to myself to forget, put off, or screw up, the better. I learned that the hard way, and now I preach the value of good customer service at banks like the Halifax to anyone who will listen for those “Help me, I’m an idiot” moments. I’ve been optimizing and automating everything. Transfers to savings, payments on my credit card, different savings accounts for different things–everything.
Speaking of optimizing, do you want to know how long it took me to figure out that I control the amount of interest I pay? No, you don’t. Have you ever heard of the snowball method, where you pay down on the individual smaller loans with higher interest rates first?
Sometimes I wish I had a loan calculator back when I had just graduated from The College of New Jersey with a head full of English literature and devoid of the first clue on personal finance. Let’s just say I would have been keeping a lot more of those salary dollars if I had figured all this out back then.
Just because your salary never changes, doesn’t mean you can’t control how much money you earn. As in, actually get to use it on girls nights outs on the town or at home after buying old Sex and the City DVD box sets instead of fees and interest payments.
