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Thursday, May 16, 2013

Let's Talk About Income

Dave Ramsey says our most powerful wealth-building tool is our income.  My opinion is that my most powerful wealth building tool is my ability to connect with others, because to me - relationships are what make a rich life.  But, I understand that financially, income matters. 

Mothers all know that time is precious and that each moment spent earning a dollar is usually a moment spent away from our little ones.  So it behooves us to maximize our income during the hours we choose to work.  I describe my current work schedule as having "Mommy Hours," and I feel incredibly lucky to have some flexibility.  I get paid hourly, but get to be home after school.

Source
When paid hourly, every time you are unable to work, you are losing income.  Sick days (for me or my children), field trips, vacations, etc. mean less income.  Because such circumstances are simply part of life, I have to plan to miss at least the equivalent of one day each month.  One year, we had a whole week of snow days!  That cut my income by almost 30% that February.  When this happens, just give yourself grace and accept that it will take a little while to catch up.  Whether you pull from an emergency fund or rely on credit, do what you must to keep the lights on, the children fed and the house payment up to date.

In my pre-child days, I earned a healthy salary.  I enjoyed the predictable income and measureable increases.  Today, as an hourly employee, I notice the variables in the workdays each month, sick days and other unpredictable events that affect my paycheck.  At first, I would become fearful and panic when I was missing the chance to work so I had to adjust my expectations: I won't be able to work every hour available.  I purposefully budget assuming there will be missed time each month and then enjoy the 'extra' if it turns out that I'm able to be present the whole time. 

It just another way that you can eliminate stress by allowing yourself to be less than perfect. 

On the other hand, getting paid hourly might mean that you have the freedom to accept a second part time job, free lance work, temporary hire, etc.  Flexible schedules and applicable skills will let you fill in gaps when times demand. 

Maximize your earning potential but give yourself the freedom to live the real life you desire.  Saying yes to more work means saying no to time with your children.  Finding the balance that works for you is crucial.

Do you have any tips for maximizing earning potential?  Does your income vary monthly?  What do you do to prepare for sick days?  I'd love to hear how others survive.

How I learned about money.

Zero Dollar Budgeting.