Work More or Spend Less?
Getting out of debt really boils down to this: you either need to spend less or earn more.
Because taxes take such a large bite out of your income and because your time is limited, it’s usually a lot easier to trim your expenses than to increase your income by the same amount.
Tightening your spending by a small amount can shave thousands of dollars off your debt. For example, brewing your own coffee at home instead of running to Starbucks every day frees up almost $1,500 a year! If you earn $20 an hour and pay 30% in taxes, you’d work 100 extra hours to earn the same amount of money! Pack a lunch every day instead of take out, and you could double that.
Unless you can increase your income substantially by working more, you’re almost always better off spending your time clipping coupons and doing things yourself.
If you are thinking about working more, studies show that you’re better off in the long-run working longer and harder at your current job — even if you’re paid a salary rather than hourly — than taking on a second, lower paying, part-time job.
