Two Financial Goals – Less Debt, More Income

by Ryan Guina

This article is part of an M-Network group writing project, the 12 Days of Christmas – Personal Finance Style. Last year, the M-Network changed the lyrics to the popular Christmas song to give them a financial twist. This year, we are at it again. The First Day of Christmas was held at Paid Twice; this is the Second Day of Christmas.

Two Financial Goals – Less Debt, More Income

The Christmas season is one of Joy, Love, and Hope. It can also be a time of new beginnings. As the year comes to a close, think about your finances and how you would like to improve them. If you are like the majority of Americans, there are two things on your wish list: less debt and more money.

While Santa Clause won’t come down the chimney and drop off a sack of cold hard cash, there are a few things you can do to make this wish come true. It won’t happen overnight, but if you work hard, it may just happen in time for next year’s Christmas. And that’s something to look forward to!

Debt Reduction

Debt is an ugly beast which can be incredibly difficult to slay – especially credit card debt, which can have interest rates over 30%. If you only make the minimum credit card payment, it will take you years to pay your debt. Here is how you can reduce your debt:

Analyze your situation. Make a list of all your sources of income and all your obligations. Then use this information to create a budget.

Stop generating new debt. Doubling your payments doesn’t do much good if you continue to add new debt. Cut up your credit cards and stop spending more than you earn.

Accelerate your debt payments. After you have a budget in place and you stop creating new debt by spending beyond your means, increase your debt payments to eliminate your debt more quickly. There are several ways to do this, but one of the most effective and most popular ways is the debt snowball, which was made popular by Dave Ramsey. To create a debt snowball you take extra money you earn and put it toward your debt. When you pay off one debt, continue using that money each month to pay other debts. Your debt payments will get larger over time which will eliminate your debt more quickly than if you were to pay only the minimums.

Earn More Money

Your ability to create income is your greatest asset, and because of this, you need to not only take care of it, you need to grow it! Why do you need to earn more money? Many reasons… How about debt repayment, keeping up with inflation, investing, saving for retirement, taking a vacation, no longer living paycheck to paycheck… need I go on?

OK, we know that earning more money is never a bad thing, but it is sometimes easier said than done. Here are a couple ways you can earn more money. Keep in mind, they may take some time and there is work involved, but anything worth having is worth working for.

Earn more money through your day job. Chances are most, if not all, of your income comes from your day job. That means you need to work to maintain your current income, and strive to improve it if possible.

  • Ask for a raise. One of the best ways to get a raise is to simply ask for it. Make sure you do it the right way and go in prepared – have a list of accomplishments including how much money you earned for the company or saved the company.
  • Professional certifications. Obtaining a professional certification can lead to increased income. Research which certifications are the best in your field and go after them.
  • Change jobs. Sometimes the best way to get a raise is to go to another company. Consider it a bonus if your company pays for it.

Earn money through alternative income streams. I define alternative income as any money earned outside your normal day job. There a hundreds of ways to earn money outside of your normal routine, and earning a little side income can help you reach your financial goals more quickly and act as an insurance policy against losing your job or another main source of income.

Some ideas for alternative income include starting a side business, consulting, working a part time job, owning a rental property, owning dividend paying stocks and other investment income, working a part time or seasonal job, owning patents or receiving royalties, buying and selling items on Craigslist, Ebay, etc. With alternative income, you can use creative ways to generate more money. The limits are up to you and your imagination.

The 12 Days of Christmas – Personal Finance Style:

Published or updated March 20, 2014.
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{ 9 comments… read them below or add one }

1 Craig

I know we’ve spoke about this before but the extra income stream is huge, and killing me that I can’t be part of that right now. I really hope that over time I can save and invest in a small % of an online company to make a little extra. Anything helps. I am trying to save this holiday season and nightlife is expensive. I realized I think I need an emergency fund for an emergency fund. There are so many little stupid spendings that come up that I don’t anticipate but it adds up quickly. For example, a parking ticket, friends bday. Those little things add up.



It really makes my heart ache to see a credit card statement on one hand and the list of Christmas gifts my family expects of me. I have been disciplined enough to reduce all of my credit card debt to a more comfortable level but if I decide to make every one happy this holidays, I will be in a hole again. What a dilemma. May be sometimes you just have to say no, but is it too cruel? I mean it’s Christmas for God’s sake.


3 Ryan

Craig: It sometimes takes a lot of work to generate reliable additional income, at least of a passive or semi-passive nature (such as an online business or website). You can always work a part time job, but that is just trading time for money. It’s fine for a short term goal, but you’ll have better returns in the long run if you build an asset.

Frugalgrad: It’s never cruel to say no when you have a reason. Taking on too much debt can harm you and your family much more than a few little gifts. The important thing here is communication. Let your family know as much of your situation as you are comfortable sharing, and let them know how important it is for you to stay out of debt. They will understand, after all, they are family.


4 Bill

You hit the nail on the head concerning the need to create and maintain a budget. The first budget I ever did showed me that I had a $400/month surplus that I was spending on non-essentials. Would you pay yourself $400/month to create and maintain a budget for you?


5 the moneygardener

Alternative income is awesome and most people can likely think of ways to make sustainable alternative income throughout their lives. Growing this in tandem with growing your employment income is a great way to earn more money as we age.


6 Ryan

moneygardener: I couldn’t agree more. That is why I am trying to grow my alternative income as well as my salary at my day job. I’m also reading books and websites about dividend income, which is one area I want to start getting into in the near future. Right now I’m still taking baby steps. 🙂


7 Melissa

I dont think anyone should ask for a raise in these economic conditions.


8 Ryan

Melissa: I think that all depends on the situation at hand. Many people are high performers and are extremely profitable for their company or they have a specialized skill. Many companies would much rather give a worker a raise than allow a skilled or profitable worker go to a competitor.


9 greg group

This is a great article. I like to focus more on the income side while keeping my debt level stable. This creates more incremental income that allows me to build more future income streams. Thanks for sharing.


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