TSM Tips: Best Practices for Updating Income Changes in The Shred Method

Life changes — and so does your income. Whether it’s a bonus, raise, seasonal work, or a one-time payout, The Shred Method™ gives you flexible ways to stay aligned and optimized as your financial situation evolves. Here's how to update income changes effectively in the software:

✅ Option 1: Update or Add Income in the “Edit Financial” Tab

The most accurate way to reflect ongoing or upcoming income changes is through the Edit Financial (or Financial Information) tab.

• Add a new Income line or modify an existing one.
  
  

• Enter the average amount you expect to receive.
  
  

• Set the Interval (weekly, biweekly, monthly, etc.) based on how frequently you'll receive it.
  
  

• If this income is seasonal or temporary, add an End Date to make sure the software doesn’t assume it’s permanent.
  
  

💡 Important: After adding or updating income, make sure to recalculate your plan to keep your projections accurate.

✅ Option 2: Adjust the Actual Income Transaction

If you just received an income that’s a bit different than expected (a raise or slight fluctuation), you can simply:

• Go to the income transaction listed in your plan.
  
  

• Modify the "Actual Amount" field to reflect what you received.
  
  

• Reconcile your plan so the software adapts based on the new income figure.
  
  

This is a quick and effective way to handle small, one-time variations.

✅ Option 3: Use a One-Time Transaction

For bonuses, gifts, or side income, we recommend cycling it through your HELOC or Shred Account first. Here’s how:

1. Go to Edit Financial → Add One-Time Transaction.
   
   

2. Select “Deposit Funds into Shred Account”.
   
   

3. Enter the amount, date, and any notes (e.g., "Q2 bonus").
   
   

4. If you don’t plan to use the full amount toward debt paydown, add a second One-Time Transaction:
   
   

• Choose “Non-Recurring Expense” to pull the unused funds back out.
  
  

• Set the future date for when you'll move it to savings or use it for something else.
  
  

By letting that cash sit in your LOC for a couple of weeks, you reduce your average daily balance and lower interest charges — even if you plan to spend it later!

💡 Pro Tip: You can also review our previous newsletter on how to tell the software that an expense is coming up in the future — a great way to plan ahead while maximizing the benefits of your extra cash.

Keeping your income inputs up to date ensures your Shred plan reflects your real financial picture and maximizes efficiency.

If you have any questions about how to input your income or navigate changes, don’t hesitate to reach out to us at hello@theshredmethod.com — we’re here to help!

We also want to ask you a favor, we're currently trying to build a database of HELOC providers to help new members find a lender wherever they may be based. We would greatly appreciate it if you could fill out this form based on your HELOC provider.