Why You Should Focus On Earning More, Not Spending Less

"Spend less than you earn" is the most basic personal finance rule, because the only way to build wealth is to have a surplus of money. The Get Rich Slowly blog, however, says it's time to turn that old law upside down: "Earn more than you spend."

Picture: Rich Brooks

It's actually the same thing: earning more than you spend creates that surplus. However, this new twist puts more emphasis on increasing your earnings rather than cutting back:

"Earn more than you spend" places the emphasis on the earning end of the formula. We want to get rich slowly, not live poor comfortably. And for this we need to make enough money so that our surpluses can actually get us rich.

PF articles of recent years have tended to treat income as a fixed quantity, touting savings as the great challenge ahead. I'd like to make a different call to arms.

When we put earnings first, we task our intelligence and imagination with finding ways to make more money, instead of asking them to figure out 101 ways to squeeze blood from a stone.

Cutting spending and using frugal solutions may be easier to do than increasing your income, but the different perspective could encourage you to find ways to bring in more money and maintain your current lifestyle.

Throwing away an old rule [Get Rich Slowly]


Comments

    Oh ok, I'll just go increase my salary then.

      Good.
      When was the last time you asked for a performance and pay review. There are also other ways to improve your income if you want to spend the time and effort to do so

        Such as?

          How about getting a second/third job or start a business?

          Really? You actually have no ideas as to how you could improve your income? As another commenter said, how about working an extra job? Or finding another job in your field that pays better? Or going back to uni/TAFE and upskilling yourself so you can get those higher paying jobs? Or getting into property or the stockmarket and making some investments? Seriously, some people just expect to be hand held their entire life.

    Good perspective. You can't simply save your way to wealth. You need to increase your earnings either through career progression (or a new career), or through smart investing.

    Last edited 13/02/13 2:12 pm

    Why don't poor people just inherit more coal?

      Why don't wealthy people donate more to charity?

    soo the answer is to earn more, consume more? & that will make us happier? i guess buddha had it all wrong ;)

      Buddha was a prince... And huge :). Easy to say consume less when you've got a belly full

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