Beyond the Raise: Mastering Financial Prosperity Post-Income Boost

Are you still feeling broke even if you already had a salary increase or a new stream of income? You are not alone. Feeling broke can sometimes not be just not a feeling — it can be your real situation.

Feeling broke despite an increase in income can be caused by different factors, which include financial habits, lifestyle choices, and psychological factors.

Here are some reasons why someone might still feel financially strained after a salary increase:

Lifestyle Inflation

When your stream of income increases there is also a tendency for us to increase our spending. It can be an increase in spending on non-essentials or an upgrade to a more expensive lifestyle.

To avoid this, whenever you have an increase in income, try to adjust your budget according to your new situation. Allocate funds for essentials, savings, emergencies, and of course discretionary spending.

High Fixed Expenses

Your salary increase may still not be enough for your fixed expenses like your rent, car loans, and maybe your budget for essentials.

AVOID taking a new car loan, gadget loan, or other non-essential increase on fixed expenses. If you are planning for it, reassess your income and create a proper budget that would not compromise your lifestyle.

If you already incur this fixed it is important to realign your budget with an extra peso to spend you will have more money to spend on something else.

Psychological Factors

Our different attitudes and mindsets can also be a factor in how we spend money. If someone has a mindset of scarcity or struggles with financial anxiety, a salary increase may not automatically alleviate those concerns.

Same as the first factor, to avoid this, create a detailed budget to understand your income, expenses, and saving goals. Practice being mindful and stress reduction activities. Also, don’t forget to celebrate small wins or give yourself a gift from time to time.

Embracing these proactive measures empowers you to harness the full potential of salary increases, paving the way toward lasting financial stability and a more secure future. (ASC)