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The Latte Factor

When people talk about frugality, something that gets kicked around quite often is the Latte Factor. That is people who go to Starbucks every morning and drop $5 on a specialty Latte when they could just make a cup of drip coffee at home and save themselves $4.80 each day, which adds up to over $100/month and more than $1000/year. And I get that. Frugality is all about the small choices you make each day that save you a bit of money. These small choices add up in the end and soon you can find yourself with a lot of money in the bank and you’re retiring early on some fabulous tropical island!

Except, I think that there’s actually a bigger factor than the latte one that is not really mentioned as often. That is, simply making more money. When you’re making $20 000/year, a latte at Starbucks every morning is actually a significant amount of money, but it’s not when you’re making $60 000 or $100 000. Life is going to be quite difficult when you make a very little amount of money; not that money can buy happiness, but you need a certain amount of it to be comfortable and not get stressed about simple things like going to the dentist or breaking a leg, or having a car repair.

So, how to make more money? Here are a few ideas that I have:

1. Work hard at the day-job. Get promoted. Get a reputation as the go-to person at your place of work.

2. Do some OT. Sure, nobody likes working on holidays or the weekend, but it can often be quite financially lucrative.

3. Self-improvement. Learn a new skill, preferably one that can make you more money. Get a certificate or something that will improve your job prospects. Get a degree at night or online.

4. Don’t let fear stop you but also don’t be stupid. Change jobs if something better comes along. Loyalty was a 20th century thing. But, also don’t be dumb and quit your job before you have another offer.

5. Start a business in your free time. Nights and weekends. Quit your day-job when it starts to bring in a good amount of money.

6. Invest. Let compound interest and dividends work their magic.

7. Blogging/podcasting/online books/affiliate marketing. Get good at it.

8. Network. The best jobs are usually not advertised.

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