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Thinking Ahead: Increase Salary

May 23rd, 2014 at 07:11 pm

We expect my husband will be promoted sometime in the next four weeks, likely three. Smile It had been awhile since I had figured our net paycheck for the new pay rate. As it turns out we will net an additional $1043 per month. And I don't really know what we are going to do with it. And I realize this is a good problem to have. Smile

I do know that we will have our oldest daughter in college in the fall 2015. We do have money saved, but it will not be enough for the entire degree program.

I feel like I want to just squirrel it away for some known goal, to avoid the money getting spent without any thought. I talked to my husband about it this morning and his first thought was just to save it,too. Nice to be on the same page!

Although a new fridge would be nice...not a need at all, but an upgrade to the stainless steel is appealing. I sure wouldn't mind some new family room furniture. See I can definitely find things to buy, but I don't want to just buy to buy. My husband said something about replacing our two vehicles, but since they are Honda's with 80k and 60k miles on them and run great, I'm pretty sure that is not a good use of our hard earned cash.

Just to recap, we have a $20K emergency fund, we save nearly 17%+ for retirement, save $4000 towards college per year (currently have $37K+ saved), we have a mortgage of over $200K which we are paying down by $14K this year. We also have my husband's Post 911 GI Bill that can be used to cover up to 36 months of college education. This can be split between all four of us in any way if we choose. We expect to be moving AGAIN next summer.

There are some things we will want to buy in the next year. An Apple Mac, with Photoshop, for our daughter to take to college. An intermediate flute for our youngest daughter. We are also going to be paying for lessons for our youngest daughter, which is a new $80 expense for us. Maybe a car IF our oldest daughter decides to start driving. There are a few other possible expense, but all of them would be within our current salary capabilities.

It seems strange to be at a place where we will have excess money that we have no particular plans or needs for. What would you do with an extra $1K per month? Any better ideas for us, on what we should do with the money?

Posted in Saving, Income | 14 Comments »

14 Responses to “Thinking Ahead: Increase Salary”

  1. scottish girl Says:
    May 23rd, 2014 at 07:57 pm 1400871424
    1400871424

    If it were us I'd put it all towards debt, but obviously you're not in the same position as we are. I have no other suggestions other than maybe book a holiday (vacation) however that is just spending it but you should be able to treat yourself occasionally.

  2. Carol Says:
    May 23rd, 2014 at 08:06 pm 1400871988
    1400871988

    Suggestion: use some of it for building good family memories while your girls are both home (vacations, some special restaurants, whatever applies to your family.) Whoops, I just remembered another expense from those years -- possible weddings to come? In which case, saving is a good plan. ( especially with college in the offing.)

  3. MonkeyMama Says:
    May 23rd, 2014 at 08:20 pm 1400872858
    1400872858

    Awesome!!



  4. snafu Says:
    May 23rd, 2014 at 08:55 pm 1400874911
    1400874911

    What a lovely conundrum. With a move in the near future, I wouldn't buy furniture because it may not be the choice you'd make in the next home. While they're selling a lot of stainless appliances I find I'm polishing the fridge in particular at the end of every day whereas in the past one decent wipe down a week was sufficient. I find it more difficult to keep the bottom freezer tidy, thing seem to get out of order quickly.

  5. creditcardfree Says:
    May 23rd, 2014 at 08:55 pm 1400874920
    1400874920

    @scottishgirl, I did think of vacation after I wrote the post. Our family is having such a hard time making a decision/agreeing on one this year. Tears have even been shed by a few of us. But I really do want to go somewhere!!

  6. creditcardfree Says:
    May 23rd, 2014 at 08:56 pm 1400875017
    1400875017

    @Carol, oh my...I hadn't even thought of weddings!! My oldest is not social at all, thus no boys have been in the picture yet. The youngest who knows how she will be in high school. At any rate that does make me think some of the raise should be invested for 8 to 10 years down the road.

  7. creditcardfree Says:
    May 23rd, 2014 at 08:59 pm 1400875158
    1400875158

    @snafu, I think you are right on that furniture plan. Each place is different. So far, our fridge still works, and blends in okay. I appreciate the information on the lower freezer...that is what I would lean toward. And we know I like tidy!!

  8. Beawealthywarrior Says:
    May 23rd, 2014 at 09:58 pm 1400878705
    1400878705

    When I was in the military and got promoted, I always allowed myself to spend that first paycheck on whatever I wanted. In a way I was rewarding myself. After that, I would set-up an allotment to pay off debts(when I had it) or straight into a savings account. That way I wouldn't get used to seeing the extra money and it forced me to live on what I had got accustomed to. You guys are good financial stewards so at least enjoy it for one full month Smile

  9. creditcardfree Says:
    May 23rd, 2014 at 10:11 pm 1400879508
    1400879508

    That is a nice idea, BAWW. One month, or one paycheck of spending the increase on anything. I will probably give DH a chance to buy something he wants...although he did just get a new tablet.

  10. CB in the City Says:
    May 23rd, 2014 at 11:30 pm 1400884222
    1400884222

    I would simply save it and trust that the right path will make an appearance!

  11. My English Castle Says:
    May 23rd, 2014 at 11:44 pm 1400885080
    1400885080

    I'm all for a family vaca. What's your plan with the girls' college? Are you funding most/all? I'm just asking because I see both sides of it from my side of the podium. Some kids work too much and struggle. Some kids don't value the money and goof off. But if your girls are half as diligent as you, they'll get it just right.

  12. Thrifty Ray Says:
    May 24th, 2014 at 05:18 am 1400905130
    1400905130

    How nice! Right now, an extra $1k per month would go toward home repairs for us. But if there wasn't a real need, I would probably make a list and then allocate a % towards each item...ie vacation, retirement, savings, etc. Whatever you do, enjoy the options!

  13. FrugalTexan75 Says:
    May 26th, 2014 at 05:37 am 1401079070
    1401079070

    What about thinking of 5 or so top priorities that you might want to save for for the future, and divide the extra income into those categories? If I were to have an extra $1k a month, I'd put some towards a house downpayment category, some towards car replacement, some towards an Emergency Travel fund (for funerals, etc.),and some towards a vacation fund.

  14. aukxsona Says:
    May 26th, 2014 at 08:40 pm 1401133200
    1401133200

    You have a problem I wish I had. Congrats!

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