Looking back, it’s amazing the progress Katie and I have made in our lives up until this point. 

I feel like everything that we have in our life now was once something we were wishing for. The jobs we have, the home we live in, our 3 kids that drives us nuts but we couldn’t imagine living without. 

Even our paychecks, which aren’t super big because we’re both teachers, are a luxury we didn’t always have. 

When we first got out of college, it was Katie who got a job and paved the way for us to move down to Houston. I still remember vividly how badly I wanted that first teaching job. 

And I remember how huge that first paycheck seemed to me. 

It’s amazing how huge that paycheck seemed because now it doesn’t seem huge at all. 

The bummer is that your expenses and lifestyle always have the ability to expand to fill your income. 

We all would want a raise. We imagine what we could do with just a few extra thousand a year. Or what if we got that promotion that would be a game changer for our income?

The reality is that you’d be right back to where you are now, spending everything you have and wishing that you had more. 

So how are you supposed to fight this phenomenon? Are you destined to always spend all of the money you make?

Keep your expenses within your income.

For me, it always comes back to the money equation.

income-expenses=margin

Margin is the extra space you create by not spending everything you have and it’s really the key to getting ahead with your finances. 

The issue is that if your expenses are always swelling to meet your income or if you spend over your income, you’ll never get ahead no matter how much you make.

So how do you keep your expenses within your income? 

Your budget. You plan. You spend and save on purpose.

No matter how much you’re earning, you’ll always have to work to keep those expenses within your income. And it’s the place you have to start.

Before you can start to look at earning more, you’ll have to look at your expenses and make sure that it’s within your income. If not, it won’t matter that you can earn more because your expenses will simply swell to meet them.

Earn more to give yourself a significant leg up.

In the money equation income-expenses=margin, while you have to make sure that you focus on your expenses first and are making sure that you always spend within your means, it’s definitely worth pursuing earning more.

Earning more could look like different things to different people. 

It could mean doing something on the side from your real job so that you can earn a little extra cash. 

It could mean purposefully pursuing opportunities at work that allow you to further your career and the income that goes with it. 

There’s no doubt about it, earning more over the course of a career you love is a worthwhile investment. 

It has to be a balanced approach.

The equation requires a balance that neither I nor anyone else can really dictate for you. 

It’s individual, and it’s important that you get it just right.

What you have to create is margin. You have to be able to step away from the financial edge. It’s the only way you have the money to do those things you enjoy, pay down debt, and save for your retirement.

But how you get there is up to you. 

It doesn’t matter how other people get there, it matters what feels right for your lifestyle. 

Some people can spend within their means just fine on a conservative income. Others will want to earn more. 

What’s important is that you spend within your means, and work towards an income that feels right to you. 

Do you feel like you’ve created a large enough margin in your finances? What do you think you’d need to change if you aren’t quite there?

Jared