Are You Underpaid?
There are plenty of websites available to research how much someone in your particular field or career is making. I firmly believe every individual should be compensated for their hard work. I didn’t even know how much I was underpaid at my last job until I researched what was out there on the market. Sometimes we get comfortable at our current jobs and are more susceptible to stay even though we’re underpaid. We tell ourselves stuff like, “what about my 401k plan?”, “I’m already used to this company”, “What if I don’t like my new position”, “I love my current commute”. These are all important factors in a job, but being highly underpaid is not worth it in my eyes.
Knowing your worth is very important when it comes to building wealth and accomplishing financial goals. Do not be afraid to negotiate your salary or ask for a pay raise. If your peers are being paid a certain rate, you should too for the same work. Think about it, you come in 40 hours a week and put in overtime for the company why not at least try to get what you deserve?
Being underpaid at an early age is not so bad because you have time to grow and get another position. But if you stay at a company while being underpaid, you can really miss out on a substantial amount of money over a lifetime. For example, Denzell and Leroy graduated from Ball So Hard University with a Bachelor’s degree in Computer Science. Let’s say Denzell started at company X with a $35k per year salary at age 23 meanwhile, Leroy started at company Y with a $50k per year salary at the same age. Here’s a chart with 6% annual pay raises over 5 years.
Leroy earned $56,370 more than Denzell over the span of 5 years, even though they’re the same age and have the same degree. One negotiated for a salary at the market and one started 10k underpaid. It took Denzell 5 years just to earn the salary Leroy started at. Now imagine the differences in earnings between Leroy and Denzell over 20 years or even the span of a lifetime. That could be millions if you add income to invest and compound over time. That extra income could be used to pay off debts faster or to save up for a down payment on a home. It could be the difference between living paycheck to paycheck and having room to breathe. Your pay rate is extremely important for your future, so take some time negotiating that salary. Don’t sell yourself short!!!
Here are some links to check the average salary and location for your career field