When you’re deep in credit card debt, you may have already searched for ways to earn extra money or cut back on your spending to pay down your debt more quickly. But if you take a closer look at your paycheck, you may find extra cash without doing much more than you already do.
You can increase your take-home pay — what ends up in your pocket each pay period — by adjusting deductions and finding ways to earn more on the job.
Increase your exemptions
If you’re getting a tax refund every year, it means that your tax withholdings are too high. If you’re unsure if this is the case, you can use the IRS withholding calculator to verify. You can decrease your withholding by filling out a new W-4 form with your human resources department and increasing your exemptions.
Depending on how many exemptions you add, you could use the extra cash to pay off your debt instead of giving the government an interest-free loan.
Cut back on your deductions
Unlike income tax and other taxes, which are usually mandatory, many of your payroll deductions are voluntary and variable.
For example, if you’re incredibly healthy and have the most expensive health plan available, you may want to consider getting an inexpensive, less comprehensive plan. If you save 5% of your income in your 401(k) and your company matches up to 3% of your contributions, it may be wise to scale back your savings to 3% until your credit card debt is gone. This way, you still get the full employer match, and you’ll save more by paying off high-interest credit cards than you would earn from additional contributions.
Charitable contributions, health savings or flex spending accounts and discounted perks offered by your company are other deductions you can consider decreasing to have some extra cash to throw at your debt.
Ask for a raise
If your employer is financially healthy and you feel like you’re due for a raise, don’t be afraid to ask for one. Before doing so, though, know where you stand with your manager. Gather facts about your past and current performance that can bolster your case. Research how your salary compares to others in your profession.
If you’re not yet in a position to ask for a raise, find ways to improve your productivity and your relationship with your manager to increase your chances at earning a promotion or a raise at your next performance review.
» MORE: How to pay off debt
If you still feel like you need more cash to put toward your credit card debt, consider volunteering to work overtime. A couple hours here or there may not seem to beef up your bottom line much, but it can add up in the long run and can help you chip away at your debt a little at a time. Plus, working overtime is another way to show your manager that you’re a team player and could play into future raise 0r promotion consideration.
Keep more of what you have
Once you have your take-home pay in the bank, it’s time to focus on setting enough aside to take a serious swing at your debt. Create a monthly budget by listing goals for each spending category. Track your expenses and evaluate your progress at the end of every month. Set a specific goal of how much you want to use every month to pay off your debt and hold yourself accountable.
As you take the time to analyze how you earn your money and how you spend it, there may be opportunities to pay off your debt much more quickly than you originally planned.