What do you actually make?
How much spendable money do you have? We want to make powerful money solutions in this world.
Remember, we want to use common sense as we learn about finances, instead of what the loan sharks want us to think.
This little series is met to try and help you stay out of financial trouble. I have done counseling for years and there are two things that can cause the main problems in a marriage and a big one is their finances.
Some things I see happening are these:
- People don’t understand exactly how much money they make.
- How much money do you actually use?
- What you make is the amount you can count on, period.
- Powerful money pitfalls we need to avoid.
Some pitfalls are loan sharks. These types of loans want you to fall into things you will never get out of.
I am also an ASE certified automotive technician. As I was searching for employment, I found an ad that said, you could make at that time $22.00 an hour. Sounded very good to me, right?
But! Yes, there is a but, it also stated that you were to be guaranteed only $10 an hour. What? Yes, and the rest was what they call flat rate hours. Which for you that don’t know is like a commission. An example would be: If you are making the $10 an hour times 40 hours equals $400 for the week. But let’s say you hit the $22 an hour flat rate, then you would make $880 for the week. The problem is you never get to the falt rate due to they hire way too many technicians for the place. Yes, you are always stuck at the $10 an hour. The story is, you could never count on the $22 an hour for your income. That is a pitfall as to why you can’t count on that type of income.
Commissions are not guaranteed income either. Commissions are great if you sell and make a big one, one month, but what about the next month? This is not a guaranteed income.
The same thing counts for tips. If you work a job to where you can earn tips, that’s great but not a guaranteed income. Tips on some days may rock your day! On other days, not so much.
Yes, we all have to pay for those! So this is a pitfall when it comes to your actual money. The money you earn is what you use, not counting the money Uncle Sam gets for the government. This is unusable for you. You cannot count this money. You have to count only your net income, not you’re gross. As with your gross, Uncle Sam has his hand out for his part.
This is very important due to what they call the debt to income ratio. They use this to determine what you can afford. So the loan sharks do use this pitfall to benefit them. It’s called the inflate your income pitfall. They use your gross income, this is not your spendable income. This is before taxes. Remember Uncle Sam? Yes, not that we want too, but we have to not count this as spendable income.
This causes people like me and you to overspend and get yourself into financial problems. It is a trap we have all fallen into at one time in our adult lives.
I will go into more of these traps that are used to cause us to overspend and think nothing of it at the time.
If we start using our common sense and think these things through, we can avoid some if not all of these financial problems. Make Powerful Money solutions to avoid pitfalls.
Check back next week for more on Financial Traps and how to avoid them!
check out this article if you missed it. Finances~Common sense.
Here is a GREAT book for helping you get your life organized!
Also, a great workbook to help you figure it all out!