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Automatic wealth The 6 steps to financial independence - Masreson M.

Masreson M. Automatic wealth The 6 steps to financial independence - Wiley & sons , 2005. - 291 p.
ISBN 0-471-71027
Download (direct link): automaticwealththesixstepsto2005.pdf
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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 modest 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.
Step 4: Radically Increase Your Personal Income 105
In fact, the trend has been downward since the survey began. In the beginning, average raises were about 6 percent. Then, during the 1980s, they dropped to just over 5 percent per year. In the first half of the 1990s, they dropped to about 4 percent to 4.25 percent and stayed there through 2001. They 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 several 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 easily be 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 most 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.
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.
How to Become a Noticeably Better Employee
My early career as an employee was spotty. There were times when I came in early, worked hard, and never took a moment’s break. Then there were times like these:
• At 14, working at a car wash, my buddy Brian suggested we go on a sort of work slowdown. Instead of jumping in and out of the cars to clean the interior windows, the only thing we did was dry the radio antennas. (At 5 P.M., we were handed our first little pink slips.)
• At 16, as a stock boy at a grocery warehouse, I was caught playing cards with “Fast Eddie” in a hideaway high up in the racks. (I got off with a warning that time.)
• At 18, hired to sell appliances door to door, I’d trash the sales brochures and spend my hours reading by the river. When challenged, I had no explanation for the fact that I hadn’t sold a single thing. (Job duration: two weeks.)
It wasn’t until I had a family to support that I made the transformation from a functionally bipolar employee to a dependable (and noticeably better) one.
The change happened the day after our first child was born. I realized that even with my wife’s salary ($12,000) and mine ($13,000) combined, we weren’t going to be able to raise children in any sort of comfort.
I was working at a small publishing company at the time. My yearly review was coming up, and I knew that to get an above-average increase (I was hoping for $2,000) I would have to do two things. First, I would have to get my immediate supervisor, Jeremy, to support me.
Step 4: Radically Increase Your Personal Income 107
Next, I would have to get the company president, Jeremy’s boss, Max, to notice me.
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