Tuesday, March 27, 2012

What $3,000 Annual Increase Has Done For Us

2011 netted us around a very unimpressive $14,000 for the year so it kind of got stuck in my head that yeah nice, we make $14,000 a year. ( We did it though and actually lived to tell about it AND never missed a meal, so perhaps the income was not impressive but the fact we lived on it and how was quite impressive!)

As the start of 2012, I never gave it much thought and have our base survival budget at $1400 a month. Someone pointed out how can that be, $14,000 a year would mean around $1060 a month, hmmmmm that's right, I remember now 2012 is bringing an increase of income! WOW no wonder our budget this year looks so much better than last year! We will be (if things continue on the way they are at the moment anyways) earning $16,800 -$17,000 this year!

The reason being that our adult daughter did not pay anything as she was paying on a bill that got ran up when we lived in the South. 2012 has her helping by paying a little for room and board which helps our income out as well as hubby has been consistently getting 40 hour work weeks rather than 20 hour work weeks we saw quite a bit of in 2011.

Yet what does this $3,000 annual increase mean for us exactly?  So much more than I ever really thought about at our income levels! That extra a month has basically what is allowing us to save $100 a month ( which will help cover months hubby MAY get hours cut to 20 hour weeks!) AND allowed us to drastically increase our investing to $200 a month.

There was no increase in our spending, our spending will be remaining the same. While the budget has changed some as some bills got cut, others increased, the actual spending still remains around $1060 a month with only a slight increase by maybe $20  to $40. The BULK of our increased income is being put to work for us and finally having our money work beneficially for us rather than us working for money.

Years ago, we would of used the extra money simply to increase our spending so this is a huge achievement for us to not increase our spending but put the extra money into working for us. This in itself is lifting large amounts of stress from my shoulders and showing us it can be done, even on small income levels. Perhaps it was easy as I did not even stop to notice our income increased this year, I simply laid out a sound survival budget that included the increase automatically into the savings and investing portion of the budget!

So yeah even a $3,000 annual increase can make all the difference in the world......