Radically Increase Your Personal Income

Why Ordinary Pay Raises Will Make You Poorer Instead Of Richer

Most people go through their lives working for businesses they care nothing about, dealing with problems they'd rather not face, and getting paid wages they'd very much like to change.

They dream of a better life and may envy those who make more money, but they are stumped when it comes to figuring out what to do about it. If career work is a path, theirs has a very modes tilt upward. Yes, they will get raises - but how many and how much?

In a survey of 1,276 companies nationwide, Hewitt Associates, a global human resources  outsourcing and consulting firm, found that average salary increases for 2003 were 3.4 percent - the lowest number ever recorded in Hewitt's 27 years of gathering and analyzing this kind of data. With the current state of our economy, you can bet that number is even lower for the past couple of years.

In fact, the trend has been downward since the survey began. In the beginning, average raises were about 6 percent. Then, during the 1980's, they dropped to about 4 percent to 4.25 percent and stayed there through 2001. The dropped to 3.7 percent in 2002 - before hitting record lows in 2003.

It's highly unlikely that you'll get rich on that kind of wage increase. That's especially true if you consider the effects of inflation. While wages have risen over the past decades, so has the cost of living. Some studies show that net income (after adjusting for inflation) has not increased since the early 1980s.

And the trend is going the wrong way. Between 2000 and 2002, for example, pretax median household income rose 0.6 percent to $42,409. But when adjusted for inflation, that gain became a 3.3 percent decline.

The dismal truth is that working people in America have been getting poorer, not richer, despite higher nominative wages.

To beat this dismal trend, you need to earn above-average pay increases. That, I'm happy to tell you, can be easily accomplished. Remember, these depressing statistics are measurements of the average. They include data on some workers who get no raises, many whose raises track inflation, and only a few employees who do better than that.

You want to get yourself into the third category. In fact, your goal should be to radically increase your income. How do you do that?

Although it may seem hard to believe, most businesses are more than willing to give you above-average increases. But they will do so willingly only if you give them above-average work.

I'm not suggesting that employers are benevolent. Some are and some are not. But healthy businesses are profit-oriented. And when they find employees who can help them increase profits, they are usually willing to reward them by returning to them a small portion of what they helped generate.

This has always been the case - especially with small and growing businesses. Today it's becoming more commonplace among larger companies, as they move toward performance-based pay (determining bonuses or other compensation on how well employees, teams, and the company do), to boost profits.

The Secret To Getting Above-Average Raises

To earn more - and enjoy better-than-average pay increases - there are two things you must do.

First, you must become a better employee. And second, you must make sure that everyone who matters knows you are better.

To earn radically more than you do now, you must make yourself a radically better worker. I'll explain how you can do that a little later. For the moment, though, let's set our sights on more modest goals.

Make Sure The Right People Know How Good You Are

Becoming a more valuable employee is the first and most important way to boost your income, but it's not enough. Corporate culture being what it is (in most places), you must also advertise your value.

The secret to successful self-promotion in a business environment is threefold:

1. Promote only what is true.
2. Give some credit to others, even if it hasn't been earned.
3. Be persistently self-effacing. Or so it should seem

If you don't promote yourself, you are leaving the fate of your salary in the hands of chance and circumstance. But while you want to make sure that the people in power hear of your accomplishments, you also don't want to think of you as an ambitious blowhard.

Put It In Writing

A good course of action is to get into the habit of writing regular reports on all the important projects you are involved in. Focus the report on the business, not you. Make it brief - one page is enough. Praise everyone involved. Play down your own role. But make sure the subtext is clear: Here is yet another good thing you have bought to the table.

There is a good business purpose for writing such memos. Your boss (and maybe even your boss's boss) is interested in these projects. He or she doesn't want to know the details. And he or she especially doesn't want to know about all the hassles. But your boss does want to be kept informed with very brief updates on where each project is, what has been done, and what is left to do.

When you or your team is faced with an important problem or challenge, you can write a report on that, too.
Again, make sure it is short and sweet. Again, give credit where it's due. Most important, never present a problem without also presenting at least three possible solutions. If you do, you'll get a reputation for being a good thinker.

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