By Caroline Banton, Contributor
A sudden promotion or raise might seem unlikely, but there are many ways to boost your paycheck that you might not have considered. Read on to discover 30 ways to increase your take-home income -- some of these might even improve your quality of life at the same time.
1. Adjust W-4 Exemptions
Getting a sizable tax refund each year? According to Debbi King, personal finance expert, life coach and owner of The ABC's of Personal Finance, "The best way to boost your take-home pay is to adjust your taxes. Most of us are getting big refunds every year because we are having too much taken out each payday." King recommended using the IRS withholding calculator to determine what your actual withholding status should be.
2. Increase 401(k) Contributions
Your W-4 addresses federal income tax withholding, but 401(k) contributions are deductions from your paycheck to fund your retirement account. "Your deferred wages are not subject to federal income tax withholding at the time of deferral," states the IRS. Because the contribution is taken out prior to federal income tax, your taxable wages are reduced, and your take-home pay is increased.
According to Chris Brantley of Synonym.com, "While increasing your 401k does affect your take-home pay, it's not a dollar-for-dollar decrease, since your taxable income goes down due to the higher contribution. This means you pay less in taxes."
3. Stop Your 401(k) Contributions
Suspending your 401(k) contributions is another option. Chris Miles, founder and cash flow expert at Money Ripples -- which helps entrepreneurs fix their money leaks -- explained how to increase take-home pay by stopping your 401(k) contributions: "Many people feel broke because they don't see a good chunk of their money," he said. "After taxes, insurance and other benefits, their paycheck is shot. Many contribute to their retirement plans that they may not see for decades. If you need some cash to help with your financial goals now, stop those contributions temporarily until you feel you are back on top again."
4. Negotiate a Raise or Bonus Opportunity
According to Salary.com, employers adjust their compensation rates depending on market rates. If the market rate for a particular skill that you possess is high, you might have grounds to request a bonus or additional compensation. In your next performance review, consider looking at Salary Wizard -- which provides salary information for various positions throughout the U.S. -- and leveraging your strengths to negotiate extra compensation.
5. Adjust Your Health Care Plan
What else is being deducted from your paycheck besides taxes and retirement? Examples of additional programs might include life insurance, medical, dental and long-term disability insurance. Consider eliminating any plans that you don't need or adjusting them.
For example, is your health insurance plan appropriate? If you have a low deductible, you might be paying more per month, and a higher deductible might be better in your case. A high deductible with a lower monthly premium is suitable for individuals who require minimal health care.
6. Get Paid for Working Overtime
Many workers are currently not paid overtime but are working more than 40 hours a week. The Economic Policy Institute states that "Americans' paychecks have not kept pace with their productivity in part because millions of lower-middle-class and even middle-class workers are working overtime but not getting paid for it." If you are working more than 40 hours a week, see if you are entitled to overtime pay and take advantage of it.
7. Change Jobs
Thinking about quitting your job? Frequent job changes no longer hold the same stigma they once did. Marketwatch reports that in 2012, Americans changed jobs every 4.6 years. If a job is not paying you a fair salary, don't be afraid to switch jobs.
Dana Manciagli, a career coach cited in MainStreet, advised trying to stay with an employer for at least two years, however. "Only change a job when you are completely miserable," she said. "The first option should be to search for another position within the same company."
8. Request Reimbursement for Work-Related Expenses
You might be paying for various job-related expenses -- like travel, meals, clothing, tools, etc. -- out of your own pocket. If so, ask your employer to reimburse you or use a company credit card if you can. According to Nolo.com, if the expenses are work-related expenses, they are not taxable income and should not be included in the W-2 form your employer files with the IRS.
9. Take Advantage of Employer-Incentive Programs
Many companies realize the value of employee incentives and in improving employee health to reduce stress in the workplace. Joining a gym or improving your lifestyle can be expensive and time consuming, but if the cost is supported by your company, the benefits of incentive programs can affect every aspect of your life -- not just your pocketbook.
Lidia Shong is head of marketing for About Life, a free financial planning site. "Last year, I got $460 worth of Amazon gift cards from participating in my former employer's health and wellness program," she said.
10. Take Advantage of Unique Company Perks
You might not be lucky enough to work for a company that offers house cleaning or on-site childcare, but your next employer might see the value in doing so. Colleen Oakley of LearnVest reported on companies that are providing benefits that really do put money in employees' pockets.
For example, Evernote is keeping employees happy at home and at work. Almost half of the employees have their houses cleaned twice a month at the company's expense, which saves them $2,400 annually.
11. Cash-Out Vacation Time
Cashing out unused vacation days is one of the ways to increase net income. According to Sue Shellenbarger of The Wall Street Journal, 8 percent of employers give employees cash for unused vacation days. Cash-out options are often part of benefits plans that are aimed at providing employees with options to raise more cash, to obtain additional time off, or to obtain healthcare or insurance.
12. Get a Second Job
A second job can drastically increase your income, provide additional skills and experience, and it might even expose you to other professional possibilities. The benefits that you obtain from a second job depend on the industry you choose.
For example, say you wanted to take on a second job as a medical transcriber, which creates legible reports from audio recordings of doctors and health professionals. A medical background might be necessary to the extent that any terminology needs to be recognized. The Bureau of Labor Statistics gives median wages for 2012 at around $16 an hour for transcribers, and the profession is expected to show 8 percent growth into 2022.
13. Join a Carpool
If you live in a city, carpooling is a common occurrence, as are high-occupancy vehicle (HOV) lanes and ride shares. According to PaycheckAdvance, carpooling with friends and co-workers can save up to $200 in gas. Some communities have more formal arrangements such as carpools organized through social networks, online forums and websites. Websites that offer carpooling information include DividetheRide.com and eRideShare.com.
14. Add Value to Your Company
Ask your manager how you can increase your value to your company. If you are worth more as an employee, your employer might be willing to compensate you. Be prepared to assume the responsibility that your manager might suggest.
"The key is to come from a place of service and humility, not entitlement," said Miles. "I had one client competing with over 100 other employees for a promotion that would pay him at least $2,000 more every month. He asked this question, and they told him what to do. Even though he wasn't the most qualified person, he got the promotion ... because he was the only person to ask that question."
15. Shop at the Right Stores
Extreme couponing might not be your cup of tea, but selecting the right store to buy groceries can yield significant savings. Determining which stores stock your favorite items at the lowest price will likely lower your costs.
When back-to-school shopping, for example, you might find that Target offers better deals than Walmart. In fact, a GOBankingRates.com study found that you might save more than $30 by opting for Target during back-to-school season.
16. Choose Cheaper Alternatives
Did you know that some of the best products to buy generic include medicine, cereal, spices and seasonings and more? Generic brands might seem less appealing, but substituting the most expensive items might be less of a hardship than you think. CNN Money reports that Americans waste approximately $44 billion a year on name brands, even though store brands offer the same products and, on average, cost about half the price.
17. Pay With Cash-Back Credit Cards
Cash-back credit cards provide actual cash that can boost your income. You can receive cash back or rewards in the form of points, gift cards, airline miles and more. To maximize earning potential on any rewards credit card, pay the balance each month to avoid paying interest on purchases. But if you consistently carry a balance, consider a credit card with a low APR.
18. Invest Your Money
Investing your money is a way to put each dollar from your paycheck to work and increase your savings. If you've always wanted to dabble in the stock market, read up on it and turn to a financial advisor for help. Or if the stock market is too big of a risk for you, consider putting your money in a safe investment, such as a certificate of deposit (CD), where it can accumulate interest.
19. Turn Down the Air Conditioning
Air conditioning can be a huge drain on household expenses. According to the U.S. Energy Department, two-thirds of all homes have an air conditioning unit. And, air conditioners use about 5 percent of the electricity produced in America at an annual cost of more than $11 billion to homeowners. Limit your air conditioning use or replace your AC with an Energy Star certified central air conditioner, which is 15 percent more efficient.
20. Fix Dripping Faucets
Dripping faucets contribute to thousands of gallons of wasted water each year. What is the cost of a dripping faucet? According to iSustainableearth.com, a slow drip can waste up to 10 gallons of water per day or 3,600 gallons per year. The cost of this could be $20 per year. However, a faster drip can waste hundreds of gallons per day and could cost up to $200 per year.
21. Socialize on a Budget
Meals out and social events can take a huge bite out of your budget, but there are ways to maintain social contacts while conserving finances. For example, look for happy hour deals and suggest those locations for meeting up with friends. Early-bird deals during the week can cut drinks or a meal bill by half. And meeting friends for lunch or coffee rather than dinner can be much cheaper and healthier.
22. Review Your Cell Phone Bill
Your cell phone might be a necessity, but it might be one of those items you're paying too much for. According to Consumer Reports, the average customer of the leading cellular providers, such as AT&T or Verizon Wireless, spends more than $90 per month for individual service. The figure for iPhone users is higher at $111.
Consumer Reports recommends considering dropping your current contract, finding better data plan deals and analyzing big and small carriers to lower your monthly cell phone bill and keep more of your take-home pay.
23. Cycle to Work
Not only can cycling save money on gas and other car costs, it can improve your health. BikeRadar.com cites studies from Purdue University, which showed that regular cycling can reduce the risk of heart disease by 50 percent. A healthier body means fewer trips to the doctor and fewer prescriptions, which can save you on doctor costs.
24. Quit the Starbucks Habit
A daily trip to Starbucks is a hardly an innocuous drain on your paycheck. According to the The Huffington Post, one week of a coffee a day could buy you a case of Bud Light for a fun night with your friends, and one month of coffee purchases could buy you an iPod shuffle and a pack of M&Ms. A year's worth? You could get a four-night stay in Bermuda!
25. Bring Your Own Lunch to Work
Preparing lunches every day requires planning, shopping and preparation. But buying lunch every day can deplete your paycheck. Cheat Sheet reports a cheap meal of around $8 adds up to an expenditure of $160 a month or almost $2,000 a year.
Additionally, prepared food from eateries almost always contain unnecessary fat and calories. By planning a week's lunches, you can consume a more balanced diet and improve your health, which will make you feel better and increase your productivity at work. You will also save time and money in reduced sick time and visits to the doctor.
26. Buy in Bulk
Trent Hamm of The Simple Dollar has perfected the art of bulk buying. He writes you can reduce the cost of a unit or a product by at least 50 percent by bulk buying. Just make sure that you will use all of the perishables that you purchase. If not, you will actually be wasting your paycheck instead of increasing it.
27. Try Affiliate Marketing
If you don't necessarily want to get a job to increase your take-home pay, you might like affiliate marketing. Affiliate marketing is done by a third party whereby a business pays an affiliate (you) for bringing customers or visitors to their websites. "This practice can be incredibly lucrative because you can create multiple websites, each recommending a different niche of products, and reap the profits after they're established," reports MyMakingMoneyMagazine.com.
28. Watch Your Cash Withdrawals
Withdrawing too much at the ATM or writing too many checks can result in hefty overdraft fees. Banks will allow you to make an ATM withdrawal or use your debit card for more than the amount in your checking account, but fees can be as much as $35 per occurrence.
Don't make the mistake of overdrawing. Record all checks, ATM and debit transactions, and keep a record of all fees that will be charged. And remember to review your statement each month for errors.
29. Avoid Unnecessary Bank Fees
You can increase take-home pay by shopping around for banking services and avoiding unnecessary fees. For example, ATM fees vary from one bank to another, and ATMs that are within your network will likely be cheaper. Some banks will even reimburse your fees.
Checking account fees often have a monthly minimum, but some banks waive fees for students, senior citizens or veterans. And, credit unions often do not charge fees for checking accounts at all.
30. Review Your Auto Insurance Plan
You could be spending more on auto insurance than you need to, especially of you are a safe driver. Kelley Blue Book, a vehicle valuation and automotive research company, recommends considering insurance as part of the cost of a car that you might buy.
Consolidating your insurance policies, such as a homeowner's policy, with one carrier can bring discounts. Additionally, adding all family members to one policy can save money. Shop around and compare options.
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