Should You Earn More Money or Spend Less Money to get Out of Debt?
Should You Earn More or Spend Less?
Debt can be so overwhelming… Whether it’s student loan debt or credit card debt, it all hurts your wallet the same way. If you want to pay it off, you have to decide between two things… or do you?
Is Spending Less Money the Best Option?
When you are in debt, you hear often that you need to spend less money if you ever want to get out of debt. The most frequent phrase used on this side of the argument is the “latte factor”. Basically, this phrase is saying that you should cut out a latte a day to get out of debt or invest in your future. It does not just mean lattes, however, it is talking about any unnecessary expenses. Maybe, you do not need cable anymore because you only watch Netflix and Hulu.
The big advantage of this side is that the results are immediate. If you cut out cable, you will immediately have that money in the bank. However, the disadvantage is that you can only cut so much… Also, sometimes you need a good latte to start your day better and you do not want to cut them.
Is Earning More the Best Option?
The other side of the argument is this; instead of giving up things you enjoy, you should earn more money, so that, you can afford those things while also paying off your debt. One way to create extra income for yourself is by starting a side hustle. Find something that you enjoy and start getting paid to do it. Another way to earn more money is by simply asking for a raise.
The advantage with this side is that there is no cap on how much money you can make. Also, you can continue to enjoy those lattes guilt free. The disadvantage is the time it takes to get a side hustle started.
The Answer
The best way to get out of debt or start saving for your future is to do both… Shocking, right? It does not matter how much money you make, if you do not know how to manage it, you will struggle. Plenty of athletes have made millions of dollars a year and are now bankrupt. However, sacrificing every little thing can be overwhelming and annoying.
That is why a combination of both spending less and earning more is the way to go. Everyone needs to know how to budget their money wisely, no matter how much they make. Also, the best part about the “earning more side” is that you may find a new passion and career. So, in conclusion, budget the money you do have, wisely, and begin earning extra money on the side.
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