The personal finance space is a great place to learn about getting your finances right. Unfortunately, 95% of the related discussions, blog posts, articles, and books on the topic concentrate on budgeting, investing, and debt repayment, yet the one thing that will most likely move the needle the most in someone’s financial journey the most is increasing income.
Don’t get me wrong, cutting expenses is great, but it only gets you so far – there is a limit. Someone spending $60,000 a year could maybe cut $20,000 of expenses per year without downgrading their quality of life. Yet, someone making $60,000 a year has the potential to increase their income $20,000, $40,000, $60,000 plus. The upside to cutting expenses is limited, while the upside to increasing income is almost unbound.
Furthermore, the majority of people online offering ways to teach folks how to increase incomes are found in YouTube ads standing next to a Lambo. The “I got rich – buy my course” types.
Below I will walk through a list of strategies which I’ve found to be beneficial to my career, as well as my peers, colleagues, family, and friends.
- This is anecdotal evidence and not all of it will be applicable to everyone.
- This post most likely isn’t for those working in public service, for nonprofits, and other non-corporate America type jobs. It really isn’t for entrepreneurs either. It’s for those that work in good ole corporate America. But I’m hopeful everyone will be able to takeaway something beneficial they can use in their career.
Your grandfather was right – a good work ethic goes a long way in life. Unfortunately, if you’re arriving at 9 and leaving at 5 on-the-dot, then you’re probably not going to get recognized. Increasing your income will take hard work and potentially longer hours than the traditional 9-to-5. Now don’t work late just for the sake of appearances. But if you’re finding yourself bored out of your mind at 2pm, go to your superiors and let them know you’re willing to take on more tasks, projects, etc. Put in the time and effort now, and be rewarded later.
Find a Mentor
This person just has to have a little more experience in your company and industry, they don’t have to be very senior. They have to have been around the block a bit longer than you, and know their way through the bureaucracy that is your employer. A good mentor will share their mistakes, so that you don’t have to make them. They’ll also let you know who to avoid, and who to latch onto. A good mentor is a great coach and teacher.
Finding a great mentor isn’t always easy – you may have to work at it. And you may have to find a new mentor if your first isn’t panning out. Buy them coffee or lunch and pick their brain. Most people don’t turn down free food.
Befriend a Higher-Up
Now this person should probably be 10+ years older than you and have a fancy title. They actually call some of the shots around the office. This person may be harder to find than the mentor. Find someone that shares common interests with you, which will make establishing a relationship easier. Make sure you actually like the person, as this will ensure your relationship is authentic.
Not all of your coworkers will do this, so at yearend when all of the upper-level management is discussing compensation and bonuses, you’ll have someone who has your best interests in those meetings.
Work Where Meritocracy Reigns
If your employer gives cost of living raises every year, and another 3% raise for promotions every 5 to 7 years, get the hell out of there if you want to increase your income. That isn’t a meritocracy. If Sally gets paid the same as Fred, even though she contributes way more value to the organization – then you want to avoid these places.
You want to work somewhere where Sally gets paid 25% more than Fred and advances much faster because she provides that much more value, and value is actually rewarded.
Be In a Revenue Center, Not a Cost Center
People who drive revenue at their companies have an easier time negotiating compensation. Careers that come to mind are sales, professional services, developers, etc. If you actually make the company money, they will be more willing to compensate you accordingly. Why? Because if you leave, there is a potential they will make less money. Back office roles can be great careers, but those in them may find it harder to increase their compensation more quickly than the status quo.
Get Those Accreditations
Some industries reward those willing to study and pass a test. Some accreditations are easier to get than others. Find what accreditations pay in your field, and go out and get it. Also some industries won’t promote until the person has a certain three-letters after their name, so make sure to get those early, and you won’t have to rush to get them later.
Be Willing To Relocate
Not everyone is willing to relocate for a variety of reasons. If you’re not that person, your career will thank you. This is obviously much easier to do before the trappings of a “normal” life get in the way. Take these opportunities during your career and grab them buy the horns. Move to a big, new city. Take that project in Tokyo for 6 months. You’ll be looked at as a team player, and one with experience.
Keep Track of Your Accomplishments
Keep track of your professional accomplishments in a word doc or excel file or whatever iPhone app you love. When it’s time for performance evaluations, you won’t have to worry about forgetting that project you kicked ass on 10 months ago. If you saved the company money by establishing a new process and procedure, track that and the financial impact it had. Nothing beats cold, hard evidence that you’re performing above expectations and your peers when negotiating compensation.
Be a Team Player 95% of the Time
95% of the time you should be a team player. Help your coworkers. Take work off your supervisor’s plate. The other 5% of the time, specifically around raise and bonus season, you need to be your own advocate. No one cares more about your best interests than yourself. Make your accomplishments known to the decision makers. Recency bias exists, so make sure you’re doing this at the appropriate time.
Become an Expert
Find that niche in your company or market that is underserved or that is complicated. Learn about it. Ask to be put on projects for it. Even read about it outside of work. Be that person that when something comes up regarding that topic, that your name is first mentioned. You’ll drive more value this way.
Be Willing To Leave
At the end of the day, if you complete all these strategies, it still may lead to bupkis at your employer. Some employers just suck. They are willing to coast along as they have been for the past 25 years. They don’t want to grow or evolve. But you’re in luck – there are employers out there that are willing to pay you a premium to change jobs. Even if you like your employer, it will help you gauge your market value. In 2019, it’s not expected you stay at an employer for 40 years. Don’t be afraid to interview and change jobs. It is not a black mark on your resume like it may have been in the past. Out of all the strategies mentioned here, this may be the one that has the most impact on your income today. Use it to your advantage, but don’t abuse it.
I hope these strategies are useful for you and your career. They definitely had the most material impact on my career. Which ones did I forget?