When You Make Extra Money, Don’t Save It All
This month I took a two week break – two weeks in a row .
This was the first time I had been on vacation for two weeks in a row since I started freelancing seven years ago. To be honest, I probably haven’t taken two full weeks of vacation since I graduated from college fifteen years ago.
The day off cost me roughly $ 4,000 in potential freelance earnings, assuming I could complete the same number of assignments I would normally write in a typical week.
I also took this hiatus at a time when I was making more money than ever in my entire freelance career. In other words, my ability to earn an hour was higher than ever, and yet I decided to spend 80 potential work hours without working .
Why give up the opportunity to continue earning, especially if I know that the situation can change at any time? (Customers come and go quite regularly and often without notice.)
Because, as the Financial Samurai put it:
The financial samurai notes that we are currently in a bull market (which is a good option), and while this does not necessarily mean that your personal financial situation is optimistic, it is worth asking yourself if you can spend both this year achieving your financial goals. and spend a little more .
During a bull market, you make money far in excess of your normal expected income (day job, side hustle income, passive income). In other words, bull market money seems like “free money” or “fun money.”
Your goal is to calculate how much fun money you make each year in a bull market, and start spending some of it on yourself, your family and your loved ones. You don’t have to spend 100% of the profits of a bull market every year. However, you should try to set aside and spend at least 10% of the fun money on their lives.
I spent $ 3249.81 on the two weeks of travel. That’s 3 to 4 percent of what I expect to make this year, but note that the Financial Samurai suggests spending 10 percent of our atypical bull market profits, not our total profits.
I will probably make $ 30k more this year than last year (before taxes, excluding investment income). $ 3,249.81 is roughly 10 percent of that amount.
The rest of my extra money goes straight to saving and investing because bull markets don’t last forever.
If this was a better year for you than usual, how did you allocate your money in the bull market?
Also: When was the last time you took a rest for two weeks in a row?