Credit cards and auto title loans aren’t the only way to get extra cash when your day job just isn’t cutting it. Many people in need of extra cash are turning to secondary jobs for some much-needed supplemental income. For many, taking on a part-time gig could mean the difference between living comfortably and living paycheck to paycheck.
But if you’re not careful, you could end up working all those extra hours with nothing to show for it. This is where the art of budgeting comes into play. Here are a few smart budgeting tips from the pros that can help ensure that all those extra hours equate to your long-term success.
First things first - before you spend any time figuring out where your extra income should go, be sure cover the expense of all your big monthly bills. These would include your substantial set expenses, such as your rent or mortgage payment, your car payment, your health insurance, etc.
Once all your major bills are out of the way, you can focus on budgeting what income you have left over. This would be the money that goes towards utilities, food, savings, entertainment, and all other expenses. By taking care of your big bills first, you’ll have a much better picture of what you have to work with, and where you can make cuts, if necessary.
Paying yourself should be just as important as paying any other bill you have. By paying yourself first, you’re actively investing in your future. Building up a savings or retirement fund doesn’t have to be a challenging task, though. The most effective way to save and keep saving is to start early and let your money grow over time.
By allocating a set percentage of your income each month early on, you give your savings time to grow over time without leaving you feeling deprived in the present. Try setting aside 10% of your monthly income to start, and increase this amount as your budget allows.
If your paycheck is $500, take $50 out and put it in a savings account or a retirement fund. By repeating this small step over time, you’ll be surprised how quickly your funds will accumulate and grow over the course of just a few years.
Divide your budget between your two incomes. The income you receive from your full-time job could be budgeted towards all those big monthly bills, while your part-time income could be allocated to building your savings, retirement or emergency fund. By taking a two-budget approach, you will have a more clear idea of where your money should go based on where it’s coming from.
You may not have known about this helpful amenity, but most banks and lenders will work with you to accommodate your income schedule, even if it means changing your monthly billing due date entirely.
By moving your billing due dates closer to your payday, you won’t be tempted to hold off on paying bills after receiving your paycheck. Instead, you’ll be much more inclined to stay on top of your bills by paying them as soon as you have the money available.
Try to allocate a certain portion of your additional income for fun activities for you and your family to enjoy. When you have a second job, your time will be more limited, making family fun time together more important than ever.
A strict budget with no room for fun is a disaster waiting to happen. Sooner or later, you’ll crash and burn without an outlet for enjoying yourself. Giving yourself an entertainment budget is the perfect way to make sure you enjoy the fruits of your labor from time to time.
Now that you have some extra cash to work with from your part-time job, it’s time to exercise a little frugality. Just because you have the extra income doesn’t mean you should spend it frivolously or adjust your lifestyle.
Always keep this little piece of advice in mind and you’ll be surprised how far that little bit of extra cash from a part-time job can go. The people who always seem to have money are the ones that rarely spend it. Funny how that works, right?
So there you have it, six smart and effective ways to maximize the financial benefits from taking on a part-time job. Take these tips to heart and your extra paycheck will take you a lot farther than you ever thought possible. With a little bit of discipline and perseverance, your hard work could translate into a better lifestyle, a secure more future and the peace of mind that comes with financial security.