I give myself raises by cutting back on frivolous expenses or paying off debt. I cut back to basic cable TV($12/month…down from $50), stopped eating out as much, etc.
However, those measures can only go so far. I am now onto my 3rd employer in 6 years and with each move I was able to acheieve close to 10% bumps in pay. I don’t like the long resume but if I stayed at these companies I could only expect <3% raise each year (no bonus). Inflation just means that with each year in the same place I was making less and less money. Ultimately, the only thing that has truly paid off (literally) over the long run has been steady, slow investment in the financial markets. I don't day trade, but I do automatic investments every month. Because of this last bull run for past few years, I was able to sell some mutual funds and pay off big chunks of debt allowing me to free up more monthly cash flow. In short, cut back on expenses...use the extra cash flow to pay down debt or invest....free up more cash...continue the cycle.
