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2. More income streams. Always be on the lookout for ways to have money rolling into your pocket from a lot of different places. Maybe you’re a good writer and can sell a short story or an online ebook. Maybe you’ve got a little piece of land somewhere that you can lease to a farmer or a developer. Maybe you spend your free time managing a flower bed in the park - why not put a little wooden freewill donation box out there for people to drop a coin in? Maybe you have some extra cash laying around with which you can buy a long-term treasury note that will keep issuing you a check every six months. Having more income streams merely means that losing one of them (like your job) is less devastating in your life and it also means your overall income for now will go up.

3. Start a side business. Instead of burning a few hours in front of the telly each evening, how about investing at least part of that time into starting a side business? You can try starting a blog with a few ads on it, or maybe you’re good with woodworking and can make deck furniture. Maybe you’re good at baking bread and can take loaves to the farmer’s market, or maybe you deeply enjoy gardening and can sell vegetables. There are lots of possibilities out there for starting a business that will supplement your current income and perhaps eventually grow into your main income.

4. Move towards your passions. Whenever the opportunity presents itself, gravitate towards the things that really excite you, because passion is what will make you successful. For me, my passion is writing, so I’ve made an effort to gravitate towards it by working on The Simple Dollar in my spare time. For others, it could be anything - maybe it’s leading a team, or perhaps it’s writing beautiful computer code. Whatever really excites you and makes you want to do more and more and more and better and better and better, that’s what you need to move towards at all times.

5. Don’t burn bridges. You never know when a relationship you’ve forged in your past might come in handy later on, even the ones you completely don’t expect. Thus, even if you feel wronged in a situation or want “revenge” on some people - or even if you just feel an urge to spread negative gossip - resist it. As you get older, you’ll find yourself time and time again bumping into people that you forged relationships with earlier on - if you burned those bridges, you’ll find that eventually you’ll have burnt that very bridge that you need to cross to get ahead. My advice? Never spread a negative word about anyone, because it never helps.

6. Keep in touch! When you do build a bridge with someone, don’t let it get old and worn out - spend the time to keep in touch with that person. Shoot them an email or a phone call every once in a while just to see what they’re up to. When it’s clear they need help and you can easily provide it, always provide it. I found the book Never Eat Alone to be particularly powerful in this regard. I’m rather introverted, and it’s often a challenge for me to initiate and then keep communication going with someone, and this book provided tons of tips on how (and why) to keep contact with people.

3. The ten second rule Every time you go to make any purchase, even when you pay a bill, stop for ten seconds and ask yourself if this is really something you want to spend your money on. Do you really need this item? Do you really need to be paying $14.95 a month for unlimited text messages when you use maybe ten? Could you reduce that electricity bill by putting in a lot of CFLs? This one simple technique will often point you in the direction of spending less money.

5. … but don’t forget the big picture. That, of course, doesn’t mean that you should justify every purchase with a basic “I want it and I have money in my account.” That shouldn’t ever be enough to motivate a purchase. I find that using a visual reminder in my wallet of what I’m financially working towards does a great job of keeping my mind on the big picture and helping me filter out what’s really needed and what’s just a fleeting desire.

2. Build an emergency fund. An emergency fund is an amount of money you keep in a savings account that’s intended to be used in the event of a major crisis, such as a job loss, a medical emergency, major car damage, and so on. I usually suggest to people that they measure their emergency fund in terms of months’ worth of living expenses - you should have a month and a half worth of living expenses for each person you claim as a dependent. So, for me in a house with two children and my wife, I have a six month emergency fund.

5. Pay off all debts. If all of these are covered and you still have cash left over (which you will, given some time), the next step is to pay off all of your debts. Get rid of your car loans, your student loans, and your mortgage. This is actually the step I’m focusing on right now, as I have already taken care of steps one through four.

6. Invest! You might also want to start investing at this point. My recommendation is to buy low-cost broad-based index funds because they don’t have many fees and grow very nicely over long periods of time. I personally invest with Vanguard directly through vanguard.com.