When was the last time you got a pay rise? When was the last time you deserved one? If these two dates are vastly different you could be missing out on making a big difference to your financial future. Little do people realise how much of a difference the first few years of their career can make to their long-term financial situation. Just like the magic of compound interest in your bank account – it applies to your career too!
What is the real impact of an early career pay rise?
Let’s look at two different scenarios. Mary and Mike both graduate and land an entry level job earning $30,000 per year. Each year Mary gets a 2% salary increase and Mike gets 4%. While it might not look like much of a difference at first, over a 40 year career Mike takes home more than a million dollars more than Mary!
And if you want to retire early and aren’t planning on working for the next 40 years, getting larger increases early on in your career is even more important.
If you want to get serious about your career and your future, you need to start taking action. Here is a list of the things you should start doing now to get above average salary increases year on year. It is what I did and I have increased my income by 75% in the past 5 years!
What can you do to get above average salary increases year on year?
Enjoy your job
Let’s be real. You aren’t going to love every minute of your job no matter what you do. Nonetheless, if you hate it or loathe turning up you are never going to be able to perform at the level required to make large gains.
I used to hate getting up in the mornings and knowing I had to go into the office. It really wasn’t working for me and I wasn’t performing at my best. I was making a whole range of excuses as to why I couldn’t get another job;
- I didn’t have time
- They needed me – other people had recently left
- I didn’t have enough experience
Until one day I couldn’t take it anymore – I took a leap of faith and quit. I found another similar role in a different industry and the change was amazing and almost instant.
Find work you are passionate about, or can at least appreciate the results of your work. It will go a long way to being able to action the rest of the ideas below.
Find a company that needs your skill set
As mentioned above, I took a similar role in a different organisation and completely new industry. My area of expertise was relatively new to this industry and so far only really big companies could justify the headcount (read cost) to hire staff directly. The company took a risk on hiring me, hoping I would bring value to the business than occasional consultant fees.
Since I have started here the business has grown over 250% and there have been many more consultants hired to do the work I used to do. I paved a way for the business to see the value in having an internal team. Being on the inside when there has been a large growth means I was able to put my hand up for new roles as they became available and I was already a known – and respected constituent.
Keep a look out on job boards or through word of mouth at industries that are growing and may need your skills. You may need to start at the bottom and prove your worth like I did, but once you have a foot in the door the growth opportunities are far greater than trying to jump in after the business growth has happened.
Do the tasks nobody else wants to do
When you first start in a new role sometimes people see you as the person to take on all of the tasks nobody else wanted to do. I say take on these tasks with a smile.
If it is a low level or even boring task, never come across as if it is beneath you instead see it as being a quick win for you. Of course, if it is beyond your skillset you may need to learn how to complete the tasks or be honest with your boss that it isn’t something you currently know how to do, though you would be willing to learn if the business was open to training you.
When I started at my new company 3 years ago there was a distinct dislike for presenting at committees. The feeling was that these committees were a waste of time and nothing could be achieved from participating in them. Funnily enough, the rest of the business then viewed our department as not being a ‘team player.’
I immediately saw this as an opportunity to network throughout the business and have weekly access to the most senior managers (including the CEO). There is no better and faster way to build a good reputation than to be presenting to the executive team on a regular basis.
Of course, they were right and the business quickly outgrew the committees in favour of more efficient ways to make decisions, however at the time hose 15 -30 minutes each week were what got me (a junior) known at the highest levels.
Be known for something and get extremely good at it
Being new to a company and bringing in a different skillset is really a blank slate for you to shine. However, even if you stay at your current company you can start to build a base for yourself to get known as the subject matter expert – the one people come to when they have questions about X. Then spend all of your spare time getting really, really good at X.
It could be a part of your everyday job that nobody else wants to do so completes to an average standard, or it could be something a little left field that highlights your willingness to go above and beyond your job role to deliver the best for the business.
By doing this you will get your name out there and people talking about you – the only type of office gossip that has any benefit. Next time a project comes up with your skillset or needs someone who is willing to work hard and take on new challenges, your name might just be the first that comes to mind.
This is exactly how I was brought onto a large merger project. I was known to have a core skill set, and also the ability to think outside the box. I made sure I knew as much as I could about the company systems and how they worked, as well as what possible improvements that could be made. I was considered to be the ‘natural fit’ as soon as the new role was identified. The company saw it as the easier (and possibly cheaper, even with giving me a pay rise) option to promote me and have my role backfilled than to hire a consultant or train someone new to catch up to my level.
Say ‘Hi’ in the hallway and the lift
For an introvert, this may seem like the scariest step of all, though could possibly be the easiest. You don’t have to have a lengthy conversation, however, the way you acknowledge (or don’t) your colleagues when you bump into each other can be a way to set your reputation. First impressions really do matter and being known to be approachable and friendly is much better than being known as the person who is negative, grumpy or simply doesn’t engage at all.
No matter what I’m working on, or how close my deadlines are, I always take the time to smile and say hello in the hallways. I know this works because a very senior project manager has commented that I always appear so ‘calm and on top of things’ and this is why he asks for me to work on his projects – win!
With just 5 simple actions you could be well on your way to earning more than other people in a similar role. I know I am paid comparatively more than many people with my years of experience and the above actions are what have brought me the best results. By enjoying what you do, being a subject matter expert and making sure people know who you are you can make leaps and bounds in the beginning of your career that will make a huge difference to your lifetime earnings.
Back to those questions at the beginning of this post…When was the last time you got a pay rise? When was the last time you deserved one?
** This post was originally pubished on Family Faith Finance which has since closed down.**