5 ways to get a raise that could be harmful to your money

our end! You finally got the raise you’ve been working on. The extra money in your bank account will help secure your finances and bring you closer to your goals…right?

not always. Sometimes, the excitement of putting more cash in your pocket on a regular basis can have a greater impact on your heart, not your mind. And that can lead to lifestyle creep – when making more money leads to spending more money on finer things. Like a nicer car, a bigger wardrobe and fancier vacations.

And while treating yourself occasionally is okay – you deserve it! Spending more on things you don’t need and skipping important financial choices can delay your financial success and possibly even your retirement plans.

So even though your direct deposits are bigger these days, don’t get distracted by all the shiny new stuff you can afford right now. By making these mistakes, an increase can actually do more harm to your financial goals.

Mistake #1: Not increasing your 401(k) contributions

When you get a premium, one of the smartest things you can do is increase your retirement savings contributions. If you don’t need extra cash to pay your bills, you won’t miss it — but you’ll be happy to stash it away when you see your 401(k) grow.

And if your employer matches every contribution, that could mean hundreds of thousands of extra dollars in your account when you retire. It’s free money!

But if you can’t take advantage of this employer benefit because you need all of your paycheck each month, a company called Lendtable will give you the money.

We know it sounds too good to be true. But if your employer has a 401(k) matching program, that’s the money they’ve already allocated to you. With Lendtable, you will be able to unlock that free cash.

Let’s say you earn $50,000 annually and your employer matches your 401(k) contribution up to 4%. If you put $0 into your retirement account this year, you’ll get $0 from your boss. If Lendtable lends you 4% of your salary that your employer wants to match, you’ll get $2,000 from your boss, minus the Lendtable fee. (This comes from the extra money you earned, so don’t sacrifice yourself.)

It takes three minutes to answer a few questions about your eligibility and sign up for an account.

Once you get the full matching amount from your employer, LendTable will take the money they loaned you, plus a small share of your earnings. If there is a penalty from your retirement account provider for withdrawing funds, Lendtable will cover that as well.

The risk for you is basically non-existent, so not taking advantage of an employer match with a Lendtable offer will make Future Millionaire bow your head in shame. Start here.

Mistake #2: Not putting more money into your investments

As you start making more money, you might think the smart thing to do is add it to your savings account.

Unfortunately, saving alone may not be enough to be able to build your wealth. You are on the right track, but the money you are hiding is not growing as it should. To retire comfortably, it helps that grow Owner. That’s why we love an app called Stash.1

You also don’t need a lot of money – you can start with as little as $5. You can invest in parts of well-known companies like Amazon, Google or Apple without having to pay money to get expensive whole shares of stock. The best part? Some companies may send you a check every quarter for your share of the profits, called a dividend. If these companies win, you can too.

It takes two minutes to register and your investment will be protected. With Stash, investments are held by its trustee, Apex Clearing Corporation, a member of the Securities Investor Protection Corporation (SIPC) — that’s industry talk of, “Your money comes with protection.” 2

Currently, Stash will give you $5 bonus once you deposit $5 into your account.3 The sooner you start investing, the more time your money can grow.

Mistake 3: Not adding more money to your emergency fund

Your emergency fund is an important safety net to have – and when you get a raise, you can reach your goal number faster.

You should not only use a safe place to hide it – but also an account that can earn you more money on your savings.

Under your mattress or in a safe you will get nothing. A typical savings account won’t do you much good. (Ahem, 0.06% is nothing these days).

But a debit card called Aspiration allows you to earn up to 16 times the average interest on the money in your account.

Not too shabby!

Enter your email address here for a free Aspiration Spend and Save account. After confirming your email, link your bank account securely so they can start helping you get extra money. Your money is FDIC insured and they use military grade encryption which is the nerd talk of “it’s totally safe”.

Mistake 4: Not protecting your family

Have you thought about how to run your family without your income after you are gone? How will they pay the bills? Sending children through school? Now that you’ve earned a premium, it’s time to start planning for the future by looking at a life insurance policy.

You’re probably thinking: I don’t have the time or money for that, even with a salary increase. But your application can take minutes — and you can leave your family running up to a million dollars with a company called Bestow.

Prices start at just $16 a month. Peace of mind knowing your family is being taken care of is invaluable.

If you are under 54 and want to get a quick quote on life insurance without a medical exam or even getting up from the couch, get a free quote from Bestow.

Mistake #5: Overspending because you can “afford” it now

Just because you earn more money doesn’t mean you have to spend more.

Wouldn’t it be nice if you got an alert when you’re shopping online at Target and about to overpay?

That’s exactly what this free service does.

Simply add it to your browser for free, and before you check out, it’ll check other websites, including Walmart, eBay, and others to see if your item is available at a cheaper rate. Plus, you can get coupon codes, set up price drop alerts, and even see an item’s price history.

Let’s say you’re shopping for a new TV, and assume you’ve found the best price. Here you will get a popup letting you know if this exact TV is available elsewhere at a cheaper rate. If there are any coupon codes available, they will also be automatically applied to your order.

Last year, this saved people $160 million.

You can get started with a few clicks to see if you are overpaying online.

Capital One Shopping compensates us when you get the extension using the links provided.

Carrie Faber is a writer for The Penny Hoarder

1 For retirement, Stash provides access to traditional Roth IRAs.

2It should be noted that SIPC coverage does not insure against potential loss of market value. Apex Clearing Corporation is a registered third party broker-dealer with the Securities and Exchange Commission and a member of FINRA/SIPC.

There is no guarantee that any stock will pay a dividend within a quarter or a year. Dividends may be subject to additional taxes and are considered taxable income. Please refer to the IRS for additional information.

3Offer is subject to terms and conditions. In order to be eligible to participate in this Promotion and receive the Bonus, you must complete the following steps: (i) successfully complete the specified registration process to open an individual taxable brokerage account (“Personal Wallet”), (ii) link an account funding (such as an offshore bank account) ) to your personal wallet, and (iii) start and complete a minimum deposit of five dollars ($5.00) in your personal wallet. In the event that the designated registration process is completed only to receive the financial advisory service (as defined in Consulting Agreement) or do not otherwise complete the account opening process for an individual taxable brokerage account (“Personal Portfolio”), you will not be eligible to receive the bonus.

The Penny Hoarder is a paid attorney for Stash.

This information is for educational purposes only. This material is not intended as investment advice nor is it intended to imply that any securities are suitable investments for any particular investor. Investment advice is provided to Stash clients only. All investments are subject to risk and may lose value. All product and company names are ™ or ® registered trademarks of their respective owners. Their use does not imply any affiliation or endorsement by them.

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