More often than not, when someone says “spend less than you earn” (outside of any other context), what they really mean is just “spend less.” However, spending is just one of the two numbers that you use to determine your financial “gap”. You can only reduce your spending so far. Increasing your income, on the other hand has virtually no limit. Making more money is a lot harder, of course, especially if you’re already in a financially crippling situation.
It’s also quite often the only solution that works long-term. If you’re making $20k per year or less, no amount of “spending less” will truly prepare you for the future There are also a myriad of ways you can increase your income.You can create passive income streams. You can ask for a raise. You can pursue a higher paying job in a different field.
None of these are easy. Not by a long shot. However, neither is saving money. If you’re willing to spend the time to set up an automated savings system, it should also be worth taking a few extra hours to teach yourself a new skill. Of course, I don’t want this to come off as callous or overly simplistic (in fact, that’s exactly what I’m trying to argue against!).
There are systemic and economic issues that make climbing your way to financial stability difficult or even impossible for some people. However, personal finance is more than just math. It’s about your mindset.Reducing your expenses is just one of the three pillars of improving your financial life.Increasing your income and learning how to invest—not just investing your money, but investing in yourself—can be far more important than cutting down your bills, and they’re much harder to learn.