KNOXVILLE, Tenn. (WATE) — Financial expert John Vandergriff with Blue Ridge Wealth Planners spoke about ways to approach a conversation with employers about raises amid record inflation and also when it may be time to get a second job.

Below are some of the questions and answers from Vandergriff in an effort to help guide these conversations and decisions.

Q: WHY ARE SO MANY PEOPLE LIVING PAYCHECK TO PAYCHECK?

  • Everyday necessities like food and shelter are becoming more expensive due to inflation, and our wage growth is not keeping pace.
  • Those living paycheck to paycheck struggle to understand where their money is going. To gain a better understanding of your money, ask yourself whose paycheck is this? Does it belong to the credit card company or you? 
  • If you find yourself with more days left at the end of the month than money and continually waiting to get paid, you have an uncontrolled spending problem.
  • When families don’t have money to face an unexpected expense, they may have to borrow money, which can lead to a cycle of debt. 

Q: LIVING PAYCHECK TO PAYCHECK IS MORE THAN STRUGGLING TO MAKE ENDS MEET; HOW DOES THIS AFFECT YOUR FUTURE?

  • Living paycheck to paycheck means spending most, if not all of your money on necessary expenses and having little to no money leftover for discretionary things like going out to eat, buying clothes or taking a vacation.
  • This doesn’t leave you with any extra funds to save for potential emergencies or start putting money away for retirement. 

Q: WHAT ARE SOME STEPS WE CAN TAKE TO BECOME MORE FINANCIALLY SECURE?

Create a Budget

  • A budget is key to financial security. You can reduce a lot of stress by knowing how much money you have coming in and how much is going out. 
  • The best way to do this is by looking at all your expenses – Don’t forget your utility payments, cell phone bills, groceries and entertainment.
  • Then compare those expenses against how much you make. If your expenses outweigh your income, you’re going to have to take a hard look at where you can cut. 
  • It helps to write it all down, and you can start with a budget worksheet like the one on my website, blueridgewealth.com.

Track Your Spending

  • If you’re struggling with your budget, take a step back and track your spending to figure out where your money is going. 
  • Save your receipts, or if you have online checking, you may be able to download your transactions into a software program.  
  • Put your purchases into categories to see where you’re spending the most money. That will tell you where you need to cut down.

Cut Your Expenses 

  • This is the hard part. Now that you see where the money is leaking, you can start plugging the cracks. 
  • This might require some lifestyle changes, like giving up cable TV, gym memberships, or cutting down on coffee runs and eating out. 
  • You may be surprised how these little changes can make a big difference in solving your money problems. 

Set Goals

  • Ask yourself questions like when do you want to retire? How often do you want to travel? What about that dream house or your kids’ college education? 
  • It’s easier to save for things when you can really picture them.
  • The best way to stick to your goals and save more money is to break your goals down into quarterly and yearly numbers that are attainable for your specific situation.

Q: ANOTHER WAY TO BRIDGE THE GAP IS TO ASK FOR A RAISE. HOW DO YOU APPROACH THAT CONVERSATION WITH YOUR EMPLOYER?

  • While touting your own accomplishments may feel awkward, being confident with what you’ve done goes a long way toward securing a higher salary.
  • Remember, timing is everything when asking for a raise. Don’t ask when your boss is busy or after a slip in performance. Pick a time that follows a big win.
  • Do your research and find out what your company and others are paying for new hires in similar roles.
  • Research shows it pays to go first. Use a specific number instead of a pay range and make the first offer. Without a specific number, it’s hard for managers or HR to know how you value yourself and what will close the deal.
  • If you don’t get what you want, ask what needs to change in order to achieve what you’re asking for. 

Q: IS IT WORTH IT TO GET A SIDE HUSTLE?

  • Side hustles are becoming more popular and for a good reason! They can help you make extra money, build your resume and network with people within your industry.
  • They’re great because they can offer you the flexibility to make a little more money without the commitment of a full-time job.
  • The additional income can help pay for expenses, pay down debt or save for a rainy day.
  • It’s important to always be on the lookout for opportunities that will increase your skills and grow your resume.
  • Make sure the side hustle interests you and is worth the time you’ll need to commit in order to make it worthwhile.