Comments on: So You Asked For A Raise And Got It, Now What

By: Elliott - 21st Century Dad

Elliott - 21st Century Dad — Mon, 29 Dec 2008 02:46:09 +0000

Great advice here. I got stuck in the cycle of consumption as I steadily earned more and more money throughout my career. My lifestyle maintenance costs increased right alongside my pay increases.

There’s nothing wrong with a few splurges, the key is balance and harmony.

It’s posts like these that keep me coming back. Time needs to be budgeted just like money, and I always set aside some of the precious time I do have to read Frugal Dad.

By: Todd

Todd — Wed, 24 Dec 2008 03:51:37 +0000

I got a raise, luckily – and for 2009, a 50% increase in the biweekly health insurance premium for my family and I via my employer-provided plan (which eats up almost all of my raise). And not to mention going from 90/10 to 80/20 payment after copay, and a higher deductible. Basically, less benefit for more money.

Most people fortunate enough to have health insurance are going to be in same boat as a new year gets here – premiums go up every year.

As a pretty sizable deduction from your paycheck (right up there with your 401k, maybe more), I think not even mentioning it overlooks a huge variable out of any ‘what to do you with your raise’ discussion. It may all be a moot point – your raise may just be helping you tread water for the same level of benefits you had in 2008.

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By: Amy

Amy — Tue, 23 Dec 2008 15:28:21 +0000

We bumped ours up to 8% when my husband got his raise. We are trying to make up for the time when we didn’t contribute as much due to lower wages/unemployment so we are now playing catch-up. Great ideas!

By: marci

marci — Tue, 23 Dec 2008 02:58:51 +0000

My present company does not offer direct deposit – which I had at a previous job. What I do now is just deposit the whole thing into my investment account, and then just take out my ‘budget’ amount… that way there’s no fudging on the spending

By: the weakonomist

the weakonomist — Mon, 22 Dec 2008 17:06:11 +0000

@GFish Bingo!

I utilize direct deposit for my Roth IRA, 401k, Emergency Fund, General Savings, and Checking, with each group getting a specific percentage of my paycheck instead of a set dollar amount.

That way, whenever I get a raise/bonus/billed overtime, every part of my finances gets a raise as well. I still do x% to the Roth, just the monetary value is higher. This also allows me to upgrade my lifestyle a bit since more money goes into Checking. I can pay off debt faster too since more funds are going to Savings. If I were to come into a substantial raise that alters a lifestyle altogether, I’d consider a rebalance.

Woe is me the day I leave the big company to work for a smaller one that might not offer direct deposit. It keeps me from my money.

By: GFish

GFish — Mon, 22 Dec 2008 16:40:35 +0000

A raise also compounds over time because raises are usually a percentage of your previous year’s income. So each succeeding raise is increased even more because of your previous raise.

By: Writer's Coin

Writer's Coin — Mon, 22 Dec 2008 13:01:25 +0000

I agree 100% on the 401(k) choice. That’s what I did when I switched jobs—bumped it up to 8% from 4% and still my salary went up, which I just saved and threw into my ING account.

So while I didn’t technically ever “see” the whole raise in my paycheck, I didn’t need to. I see it in my 401(k) statement (the contribution part, not the returns anyway!)