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If you feel that you have earned a raise but haven't received one you'll need to ask for it. Unfortunately, your boss can always say no. But if this is the case you can use other things the same way. For example, at this time of the year you might be in for a healthy tax refund. If so, you need to make a plan for the money before you actually get it. Then you need to change your withholding so that you have more money in your paycheck over the next year, which would be just like getting a raise. If you're saving for retirement you could then use that money to boost your 401(k) contribution.
Set up automatic transfers to a Traditional or Roth IRA
If you change your withholding so that you have more money in your paycheck and your company does not offer a 401(k) you should definitely set up automatic transfers to a Traditional or Roth IRA. The biggest difference is that with a Traditional IRA you pay no taxes up front because your contributions are tax-deductible. However, you will pay taxes on the money when you retire and begin taking distributions from your account. A Roth IRA is just about the exact opposite. You pay income taxes on the money you invest, so that you’re investing with after-tax income, and the investment and its earnings grow tax-free. Then when you retire your distributions are not taxed.
Which would be best for you?
So which should you invest in – a Traditional or Roth IRA? While there is no simple answer to this question most experts feel that for young people the best choice would be a Roth IRA. However, if you're an older worker nearing retirement than a traditional IRA often makes the most sense. Of course, for most people the ultimate answer is to diversify by having both a Roth and traditional account.
Other ways to give yourself a raise
You could also treat some of your monthly expenses the same way. When you pay off a debt such as a student loan or an auto loan, put the money you've been using to pay on it each month towards your savings goals instead of absorbing it into your discretionary spending. For example, suppose you pay off an auto loan where your payment was $180 a month. Instead of buying a new car, take that $180 and stick it into your retirement account. If you can hang onto that older car for a year, you’ve given yourself a bonus of $2160 and after two years you’d have accumulated $4320, which all by itself could be a nice little emergency fund.
Saving without cutting spending
All of these suggestions have one thing in common – they are ways to save money without cutting spending. But there's this thing about saving money. After a while, as you see your balance growing, adding to it can actually be a little addicting. You may find that you want to save even more money. If you reach this point then cutting back here and there on some of your spending may no longer feel like such a hardship.
The net/net of becoming a millionaire
The net/net of this is that yes, you can become a millionaire without even trying that hard. As you have read the secret is pretty simple. It's just a matter of putting off some of today's "wants" in favor of your future "needs". And as you have also read it really doesn't require that many sacrifices. It just means living within your salary and using part of your raises and all your bonuses to have a good retirement.