‘Disposable income’ refers to the amount of money we have that isn’t tied to other non-negotiable spending like debt repayments or rental/mortgage payments. It’s money that you’re free to spend as you wish. How to increase it is one of the most pressing issues young people face, especially in the midst of a cost-of-living-crisis in Australia.

There are two basic ways of increasing your disposable income. The first is to increase inflow: to have more total money coming in. The second is to reduce outflow, which means spending less, and being more efficient with how you use your money.

There are plenty of other ways to boost your disposable income as a young professional, which includes finding other revenue streams, investing wisely and saving money here or there.  In this article, we’ll break up the two approaches, and go through some of these examples.

Reducing Outflow

Get the Best Credit Card You Can
As a young professional, you’ll almost certainly be using a credit card to pay for a good number of your expenses. It’s important to remember that not all credit cards are created equal, and you’ll spend your money much more efficiently once you realise that some are better than others for your lifestyle.

An oft-ignored way of tackling outflow is using a premium or black credit card. They’re high-end, exclusive cards, which usually offer much better benefits than a regular card. In fact, black credit cards can help reduce outflow and indirectly increase inflow, as they often come with better rewards, a higher spending limit and more favourable payment terms.

You’ll usually need to build up a strong credit history to apply for this sort of card, so you’ll want to start now if you can’t get one yet.

Avoid Eating Out
As a young professional, you’ll know firsthand the hard work that goes into earning every dollar. Saving where you can leaves room for spending elsewhere, and one of the most effective ways of doing this is to cut down on eating out.

Because eating at restaurants doesn’t usually involve large, one-time expenses, you can often be tricked into feeling like you’re not spending much. However, dining out regularly can be a massive drain on your bank account.

Instead of eating out, try more often to cook at home. Meal prepping is one way of making your own food while saving time and money. Even when you’re busy, there are lots of easy meals you can cook up on a budget. You’ll hone your chef skills, have an excuse to invite your friends round for dinner parties, and be prepped for the week ahead. When you are eating out, try to keep in mind the number of hours you’d have to work to pay back what you’re spending on a meal, which may help you make more financially conscious choices when staring at a tempting menu.

Increasing Inflow

Find Additional Work
There are plenty of creative ways to boost your income. Whatever skills you’ve developed from your full-time job, your education or your hobbies, you’re almost certain to find someone who will pay you for them.

Some part-time jobs include freelancing in various fields like writing, web design and starting a small business on the side. A lot of these opportunities require little to no prior work experience: it shouldn’t be hard for you to get off the ground if you’re willing to put in a bit of time and effort.

There are as many side hustle jobs as there are ways to find them. Online freelancing communities, and platforms like Upwork and Fiverr are good places to start. Once you’ve found your first few clients and built a reputation, it should get easier to find more. You can also find extra work by reaching out to people you know in real life and asking them if they know anyone who needs your particular skills. And why not even advertise your services with a local publication (like ours!)?


Invest Wisely
What you do with the money you earn is just as important as how much you make. Letting your money work for you is the surest path to financial freedom, and the earlier you start doing this, the better.

If you’re not sure where to start, there are plenty of helpful books and online resources out there. Look into putting your money in ETFs (exchange traded funds) if you don’t have enough experience to invest in individual stocks. Consider mutual funds and, if you have enough, look into investing in real estate.

Since you’re young, you can afford to take a few more risks when investing. However, it’s still important to only put your money into investment vehicles you understand, as they’re a big commitment.

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Beginning your career is one of the most exciting times in your life, since it probably also coincides with your twenties. You’ll want to put your head down and work hard, but it’s also important to have fun while you’re young – which you can only do if you have enough financial freedom.

In this article, we went over some key tips to boosting your disposable income by finding extra work, cutting down on expenses like restaurant meals, getting a better credit card and investing your money effectively. If you haven’t put much thought into earning more and saving money, now is as good a time as any to start. This article can act as your launchpad into true financial freedom, and to having enough money to do the things you love.

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