How to Have More Money in 2021 - 9 Ideas for Young Professionals
Opportunities to increase your revenue streams are abundant, and we’re not talking about getting paid to take quizzes, rent out your car, or download tracking apps. BostonYPA wants to help you find opportunities (and extra money!) to help you pay down debt, boost your net worth, save for big goals, and reduce the stress around cash flow.
Change Jobs or Request a Raise
Want to earn more money in the same amount of time? Take a new step in your career, or ask for a raise! You won’t “get rich quick” but you will make more money in the same amount of time, and might even increase your happiness at a new workplace. Our blog has career advice posts from career managements and industry leaders. Find the collection here. Our Job Board also offers resources - the Resume Drop Box connects you with recruiters and hiring managers in our community, and the job board is where members share openings at their companies.
Pay Yourself First
Before spending money on something you don’t need, or replacing something that still has life in it, consider other uses for your hard earned money
Build an emergency fund - if 2020 taught us anything, it’s that good planning can keep us sane and stable when $h!t hits the fan. Having extra cash set aside will have you paying your rent, eating healthy food, and breathing easier when unexpected expenses come up, you are furloughed, laid off, or have business interruptions, or a great opportunity comes alone that you need cash for.
Live within your means - credit cards are not an extension of your income or net worth. In fact they decrease your net worth, at a high interest rate.
Don’t delay the start of your long term savings for goals a few years a way like a home, or retirement. Thanks to compound interest and growth, the earlier you start saving, the less you’ll have to save.
Learn how to Manage Your Debt
Managing your debt isn’t the same as paying your debt off faster. Sure, by paying off your debt you remove a bill from your expenses, but it won’t immediately increase your net worth. What if you can’t afford to pay off a loan? What if there was a better use or investment for money you’d put towards your debt? Make your debt work for you by refinancing to lower interest rates - not only will you pay less interest over time, you’ll be able to to make the money you have work better for you - whether it’s investment opportunities, paying off high interest debt like credit cards, or a purchase you’ve been looking to make.
One of the easiest to manage, yet often biggest pieces of debt a young professional is carrying is their student loans. Many of us have experienced debt relief due to the CARES Act and it’s extension, but that is about to end. Our partner, Juno, uses collective buying power (that sounds like community to us) to negotiate low rates for new and refinanced loans.
Use the Retirement Savings account that’s best for you
401(k), Roth IRA, tax deferred, tax free - what does all of this mean, and why do you have so many options? Well, you have several options, because people have different needs, and what your bestie or coworker is doing might not be what’s best for you.
Choosing the right account, or blend of accounts will help you retire with a healthy amount accumulated in your investment accounts. Strategizing how much to put in each type of account will reduce the amount you need to save for the same outcome and lower your tax bill in retirement. Spoiler alert: when you lower your taxes, you are left with more money to spend.
It’s never too early to receive guidance from a financial professional, in fact, great investment decisions compound just like the interest in your savings account. Bad moves can compound too, so work with someone who is held to a fiduciary standard. A fiduciary will give you advice with your needs put first, without conflicts of interest - like needing to sell you something to get paid. That’s why we host Financial Planning for Young Professionals Seminars, to review this topic and more. Erica will be your consultant and coach, guiding you in making great decisions and following a plan specific to you.
Want to learn a bit more about investing in the stock market? The Finimize newsletter sums up world economic news in a daily email that can be read in five minutes, without any fancy investment speak. Subscribe for free.
Move to somewhere that costs less
Every where you look, Boston’s apartment buildings are offering rent concessions. Capitalize on how students aren’t in Boston right now, and save 1-3 months rent. If you landlord isn’t able to give you a break, you can literally move across the street to save thousands. Or, use this as an opportunity to explore a new neighborhood. Just be sure to use a local moving company.
Thinking it’s about to become a buyer’s market? It’s always a buyer’s market for young professionals that know about Boston’s Affordable Housing Programs. We like the to describe our Members Rich Hornblower and Jason G. Mahoney, Esq. as the duo that can get you into a 2 bedroom downtown condo for under 400k.
Reduce the Cost of a Big Bill
No, we’re not talking about about saving $5 on a $20 Grubhub order - that still costs you $15. And takes $5 from a local business that’s fighting for their life.
Think about the bills you can’t eliminate, like insurance. Car insurance, renter’s insurance, business insurance, home insurance, whichever you have, you know you need it. You may think you’re saving by bundling your policies with one company, but when you work with an independent agency, your representative can review options at several insurance companies to customize your coverage, and your bill. Doug Garabedian, our friend at Duffy Insurance Agency, can help you with this, and will let you know about the group insurance discounts our community may access.
When you’re done speaking with Doug, give your cable or internet provider a call. You may be nearing the end of your “promotional term” (read: your bill is about to increase) or they may have new options for you. It never hurts to ask, especially when they have new competition in town.
Find a side hustle that fits your life style
Ride share drivers earn far less than you think (and far less than they think, until they get their first 1099), but having a side gig that helps you explore a creative outlet, let out your entrepreneurial spirit, or have some fun with friends can be a rewarding way to earn some extra cash.
Think about what you are already doing in life, and what interests you and your circle. For example, now that you can’t go out, do you find yourself drinking wine at home, with a small group of friends or on Zoom happy hours? Perhaps being a wine consultant would be a fun way to use some free time and give you a second income stream. BostonYPA Member Alisha Phipps has seen her passion grow to a business, and is growing her team. Alisha’s submission to our job board gives you all the details.
Reduce food waste and save on groceries
And support local farmers and businesses. If you’re cooking more at home your grocery bill has gone up (while your dining out bill has gone down!) and you might find yourself having groceries delivered. Tons (really, tons) of produce gets thrown out each year because it looks funny even though it packs the same nutritional punch. If you think crooked carrots and plump peppers will taste the same on your plate, you can save $$ on organic produce. Reducing food waste doesn’t just help the environment, it’s a way for local markets to put all their inventory to use and also avoid running out of produce during times of increased demand.
You may have heard of Misfits market, an online delivery box. Did you know that Juice Press (with 3 Boston locations and sourcing from New England farmers) offers produce boxes, available for pickup or delivery?
Think Twice before Selling your Used Stuff Online
Selling the shoes you’ll never wear again on poshmark sounds like a great idea, until you see the fees - platform fees, paypal fees, postage fees. Not to mention, in order to sell your used item you need to price it competitively (hello supply and demand). And this might not be where you want to spend your time.
Another solution? Bag up your unworn clothes, shoes, and household items and bring them to your preferred donation center. They will get them in the hands of someone who could really use them, and hand you a receipt to apply to your tax return. No trip to the post office needed.
BostonYPA does not receive affiliate fees or commissions from the people and companies we mention in our posts. BostonYPA does choose to focus on local businesses and highlights our Members and partners when appropriate.
