Image courtesy of Stuart Miles at FreeDigitalPhotos.net
I’ve been very purposeful with my efforts over the last few years in my primary career as a software engineer. I’ve volunteered for roles, and taken advantage of opportunities that I felt would help further my career. Specifically, I’ve been aiming to be promoted to the next level. My efforts have finally come to fruition, as last Wednesday my manager informed me that I have been promoted.
As you can imagine, I was extremely excited to hear the news that I have been promoted to Senior Software Engineer.
My title promotion comes with a significant salary increase. Whenever our family’s income changes, whether it’s an increase or a decrease, it’s time for a review of every aspect of our finances.
Side Hustle Changes
My income from blogging currently totals just over $1000 a month. Fulfilling all my side hustle commitments takes a large portion of my evening and weekend bandwidth. I’ve been feeling like I’m starting to burnout at the level of effort I need to commit to blogging. For that reason, Vonnie and I have decided that I will cut back a little on my blogging efforts. This will give me more downtime for my own mental health, more time to spend with my family, or more bandwidth to give to my primary career when needed.
Planning For The Future
A significant salary increase is a great time to raise my pre-tax payroll contributions to our 401K. I want the increase in contributions to kick in immediately, so I don’t ever see a paycheck with my full salary increase. It’ll be just like my salary increase is actually whatever shows up with the first affected paycheck, with the added bonus that our retirement savings gets a boost.
Savings
Our home will be in need of some updating in the next couple of years. The first project will be the replacement of the flooring. We had an estimate done during the fall, and it’s going to be quite expensive. With this salary increase we have the ability to save faster, and get to this project sooner than expected.
Splurge for Christmas
There might just be an extra present under the tree for the kids and my wife on Christmas morning. I’m not planning on doing anything crazy. In fact, nobody in my family even asked for anything really expensive (with the exception of my son’s request for a $400 gaming chair, which he’s not getting). Just a few extra little things in celebration of my accomplishment, without going overboard.
Discretionary Spending
Our weekly discretionary spending budget will also be raised. I’m not afraid to admit it. There’s absolutely nothing wrong with enjoying life now, as long as the bills get paid, and our nest egg is being properly funded. I don’t want to wait until the age of retirement to experience life. Life is happening. Right. Now.
Because taxes are a little bit of an unknown, I don’t have exact numbers yet. But I think that we’ve come up with a balanced plan with what to do with the salary increase. We made retirement and savings the priority, but still gave our everyday budget a bit of an increase as well.
Have you received a significant pay increase recently? How would you decide what to do with a significant increase in your budget?
Congrats Travis! I know you really love your job, so it’s nice to see your hard work pay off. Nicely done, what a nice little extra Christmas present. With extra income I’d just continue to build wealth. Saving, college funds, etc. I think short term and long term saving, oh and maybe a little extra fun money too. 🙂
Thanks Brian! Sounds like we would handle a salary increase about the same – the timing was GREAT – Best Christmas present ever!
Hey Travis, congrats on the promotion and thanks for being so transparent on what you’re planning on doing with the increase. While the increase in savings, etc. is to be expected, I’m glad you took the time to mention that you would be increasing some of your discretionary spending. Life is indeed happening right now and while making sure we are set for the future is valuable, in my opinion you still need to make sure you take time to enjoy life in the meantime!
Life is meant to enjoy……every single day of it! Thanks for reading, Nate!
I’m so happy for you, Travis. You have shared your journey with us for so long, you deserve the extra time (and $$) with your family! Congratulations!
Thanks, Sassy Mamaw – looking forward to less stress for sure. 🙂
Congrats Travis!! That is so awesome! I nearly doubled my salary with this full time job, but I’m trying to pretend it doesn’t even exist since A) I have a lot of catching up to do with retirement and B) I would like to work for myself again someday so I want to build up a huge cushion.
Wow, doubled your salary? That’s awesome, friend! I’m super happy and excited for you – and wish you all the success you deserve!
Congrats- this is great! I have no doubts you will find something awesome to do with your extra cash! =)
Thanks, Holly – life is GREAT!
I get a couple dollars’ raise each year, which is always appreciated. In the past, they’ve gone to either savings or increasing the mortgage payment. But next year we’re losing my husband’s disability checks (in a sense, anyway, it’s a long story) so the raise won’t even cover that gap.
I’m glad you’re raising your discretionary spending a bit. It’s definitely one of the best choices I made. Now Tim can’t stress me out by wanting to buy something fun because it’s not coming from general funds.
Thanks, Abigail, after paying the bills, we all deserve to enjoy life, right?