Maximizing Input

• Maximizing input is, quite simply, the act of making more money. Most people want to do it, but few people succeed. In a career environment, the best method of doing this is to maintain superior performance in your job and keep your eyes open for career advancement possibilities. If you own your own business, it's up to you to maximize your income through effective promotion, savvy buying decisions and efficient management to maximize profit. People in low-paying jobs with little opportunity for advancement may find that their only option for increasing their income is to take on another job.
  
  

Minimizing Output

• Minimizing output is the neglected twin in the two methods of financial stability, because many people want to make more while few want to spend less. A change in attitude can make spending less a challenge and a game rather than a chore. Doing simple renovations to your house to reduce energy costs, buying food in bulk, and buying some clothing and household goods at second-hand stores can be interesting recreational activities as well as ways to reduce your spending. You may find that replacing a regular $100 meal at a fancy restaurant with a nearly free potluck at your home with friends yields just as much enjoyment without spending the money.
  
  

Spending More to Save

• In some paradoxical situations, you can save money by spending more of it. These are the situations where you need something and are given a choice between a cheap and poorly made item and an expensive and superior item. It is almost always to your long-term financial advantage to buy the more expensive object. A cheap pressboard bookshelf will begin to break down within a few years because it isn't made to last, while an expensive hardwood bookshelf will be handed down to your children if it is maintained properly. The trick is to avoid taking this idea to extremes. A new Toyota Camry may be a better buy than a cheap, 15-year-old car, but that doesn't mean you need to buy a Porsche Boxster.
  
  

The Trap of Carrying Costs

• Interest that you pay out on some loans, such as mortgages, may be inevitable, but it is still a drain on your finances. High interest on credit cards should be avoided if at all possible. Eliminate your credit card debt and use your savings to make pre-payments on your mortgage. A prepayment of $10,000 on a 30-year mortgage within the first few years can save you many thousands more and knock years off of your amortization date.