How to Increase Your Take Home Pay Without Asking For A Raise

If you complain that your paycheck is not giving you enough money to live on then it’s time for you to give yourself an instant raise. This time, you don’t have to sweat about showing your boss your past achievements for the company (particularly if you don’t have much to show in that department). You can give yourself an instant pay raise without asking for upper management to increase your take home pay.

Here are some things you can do so you can take home a fatter paycheck each month:

1. Don’t pay more tax than you need to.This is one of the easiest ways to get a bump in your take home pay. When you begin a job with a company, you are asked to fill out a form called the W-4. It basically determines how much money the Federal government should take from you. If you choose 0 personal allowances, you’ll most likely receive a tax refund when you file your 1040 individual tax return at the end of the year. However, this is not a good thing to do particularly if you always find yourself strapped for cash.

Instead letting Uncle Sam keep a huge chunk of your pay, you can increase your monthly paycheck by claiming the personal exemptions you are entitled to. You can do this especially if you have experienced a major life event such as getting married or having kids. Be sure to take only the exemptions you are entitled to so that you won’t end up having to pay the government taxes.

There are also other tax credits you can take advantage of to lower your tax bill. For example, if you contribute to a retirement savings plan like the 401k, you possibly qualify for a retirement savers’ tax credit which can shave up to $1,000 on your taxes. There are also other tax deductions and breaks that you can certainly qualify for. Be sure to review what these are on the IRS website.

After you have made changes in your W-4 form, be sure to submit it to your human resources department and you should be able to see a bigger paycheck in the next few months.Another way to reduce your withholding is to take advantage of your employer’s Flexible Spending Account or Cafeteria Plan if it is offered. You can make contributions to these vehicles which you can use for medical care and general health- related expenses. Money you put to these plans are excluded from Federal, Medicare and Social Security taxes. This leaves you more money for each pay period since the earnings are not taxed.

2. Don’t waste your income on late fees and charges.If you want to leave more money in your pockets, you should strive to pay your bills and other obligations on time so you don’t pay extra on late fees and charges. Credit card bills are notorious for their high interest rates and hefty penalties if you don’t pay on time. What does this tell you? If you are sure that you won’t be able to pay off anything you charge to plastic by the due date then don’t buy it. Being late by even just a day on your credit card payment can jack up your payment by at least $35! That’s a pretty hefty fee you certainly don’t want to shoulder.

To make sure that you don’t forget the bills that are due for the month, it’s a good idea to set up a system that will remind of your obligations. This can be as simple as a filing system at home wherein you separate the bills that are due for the month or you can opt to use technology to your advantage. For example, you can set up automatic payments through your bank account if there is such an arrangement offered by the credit card company. This way, you only have to set the schedule once and the company will deduct the payment you owe from your account.You do have to remember a couple of things about this arrangement, though. First, you need to make sure that you do have money in your bank account by the time the payments are due so you don’t experience delays and get levied late fees. Second, do review your statements from the bank and from the companies to make sure that there are no errors. You also want to be certain that the payments you make are actually credited to your account.

3. Work on getting rid of debt.The most surefire way to increase your cash flow in the future is to work really hard at getting out of overwhelming debt. Your take home pay may initially be

sufficient but once you start making all the necessary payments to your creditors, you’ll notice that you are left with barely enough cash to get through the next payday. The natural consequence is to depend on plastic to make even the most necessary purchases like food and toiletries. Unless you get rid of debt, the cycle will continue and you will constantly live from paycheck-to-paycheck or worse.

Here’s the real deal: You need to take proactive steps to eliminate debt now so you can bring home a fatter paycheck in the future. The road will be rough, no doubt about it. But after you hurdle this difficult journey, you’ll reap the rewards. The lessons learned during this difficult time should also serve as your inspiration to not go this same route again. Once you have gotten rid of debt, strive to stay debt-free.

4. Pay yourself first.In order to feel that you have a higher take home pay, you need to start paying yourself first. This basically means putting a portion of your money in savings. Experts recommend starting with 10 percent of your salary. But there is no reason why you shouldn’t bump that up to 15 percent or even 20 percent if you feel like it.

Arrange an automatic transfer from your checking account to your savings account so that you don’t have to include the money you pay yourself to your budget. Even if you have to cut down on restaurant meals or restrain yourself from buying the latest version of the smartphone, you can take comfort in the fact that your savings account is growing.

5. Prioritize your expensesDifferentiating the necessities from the luxuries is something you need to do so you can prioritize which things to buy and which to reserve for those times when you will have extra cash. Food, gas, debt payments, bills and childcare expenses (if you have any) are things that are considered necessary in the list of most people. However, this will depend on your lifestyle and income so you need to make your own list of priority expenses.

The best way to ensure that you are spending only on the things that truly matter is to create a spending plan. If you don’t use a budget, you’ll end up buying anything and wondering where all your money went at the end of the day.

Conclusion

The five steps outlined above detail how you can increase your take home pay without going up to your boss and asking for a raise. However, there are times when you feel that no matter what you do on your end, the money you are taking home just isn’t enough. If this is the case and you feel that you deserve it, perhaps you can consider asking your boss for a raise. Now this can be a scary prospect for most employees. However, if you believe that the time is right for you to broach the subject, you should do so.

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