TIP 26
EARN WHAT YOU DESERVE
Money isn’t everything as long as you have enough.
Now that you’ve cut your expenses, it is time to get to work on the second half of the money equation: increasing your income. If you work for someone else or for a company, you can ask for a raise. If you own your own business, you may be able to raise your rate or fees or perhaps add another product or service. If you are already making more than the market rate, then perhaps you could start a sideline business to increase your income.
Let’s begin with how to ask for a raise. Start by doing a little investigating to find out what people at similar companies in the same position as yours are earning. Many business magazines publish national salary averages or simply do an online search for “salary comparisons.” Ask your friends who work for other companies. You may be surprised to learn that you aren’t even earning a competitive market rate. If you discover you earn more than average, don’t let that stop you from asking for a raise. An excellent employee is well worth retaining.
Second, list your accomplishments over the past six months to a year and type it up in a memo. You need to build a strong case for why you deserve a raise. Use as many concrete, numeric figures as possible and demonstrate how your performance helped to improve the bottom line. Cite projects and committees you worked on and their results. More often than not, your boss will not remember everything you do, so send a quarterly memo of your accomplishments and keep a copy. This way, when your boss writes up your evaluation, she will have all your memos on hand to refer to. Never list any failures in these memos. Your manager may have forgotten that you were the one responsible for a certain mistake, so it is best not to remind her. Stick to the positive facts.
Many companies ask employees to write a self-evaluation. Be very careful when it comes to the areas for improvement. Don’t provide your manager with negatives she may not even be aware of. On the other hand, you don’t want to look like you aren’t trying to improve. A safe bet would be to mention an area where you would like to develop your skills. For example, if you work in operations and want to learn more about sales, write that down as the area for improvement and request the opportunity to develop your sales skills by taking a sales training class. The result? You appear to be a very proactive employee. Large companies do salary planning well in advance, which means that your boss may estimates your salary increase six to nine months before you get it—all the more reason not to wait until the last minute to keep your boss informed of your results.
Third, after you’ve written the memo for your boss, request a meeting to discuss your performance in person. If your company already has quarterly performance reviews, great, but don’t let a quarter go by without some feedback from your boss. You want to make sure you are on track and meeting the company’s expectations. How are you going to know this if you don’t ask? If you aren’t meeting expectation, it is far better to know as soon as possible so that you can course-correct.
If this is the case, document your improvements in any problem areas as soon as possible, and set up another meeting with your boss to discuss this and demonstrate to her that you are doing a great job.
Fourth, ask for what you want. If you are a great employee, you should be making more than the industry average. You may not get what you want, but you should at least ask. Since most people are afraid to ask for a raise, this will put you in a special category. When the boss is looking at the amount of money, she has to distribute among her team, who do you think has a better chance of getting a bigger percentage of the pie? The person who asks and makes a solid case or the person who may be working just as hard but never states his case?
What if you own your own business? If you are self-employed, there may be any number of ways to make more money. The first and easiest is often to simply cut your expenses, but since you’ve already done that, it may be appropriate to raise your fees or rates. I encourage my clients to charge whatever the market will bear and to raise their rates every year or six months depending on their business. In order to do this, you need to be continually adding value to your services so that the increase is worth it for your current clients. Or you may simply maintain existing clients at a grandfathered rate and charge new clients your new rates. Again, this depends upon the type of business, the market rate, and the level of service.
What about moonlighting with a part-time job in the evening? This can be a great way to make extra money while at the same time experimenting with a different field. Many clients are not fulfilled in their current work but are not sure what they would really enjoy doing. Setting up a sideline business can be a safe way to try a business idea. Or volunteer or to work part time in the field you are interested in. Just make sure you don’t overdo it, or it may negatively affect your day job. Contact human resources for your company’s policies concerning part-time work and get the appropriate permissions in order to prevent a conflict of interest, which could jeopardize your current job. If you are wondering where you will find the time to moonlight, try turning off the TV (Tip 32). The average American watches more than 20 hours a week—enough for a part-time job.
What are other creative ways you could increase your income? Perhaps a hobby could net a little extra income if you got creative. Perhaps you are a great dancer and love going out dancing in the evenings? You might be able to get paid for it if you start giving classes or teaching private lessons. What about leveraging one of your natural strengths? If you are super-organized and love straightening out a mess, you could work as a professional organizer. If you are a naturally gifted salesperson who enjoys making cold calls and has a huge network, you could do well in a multilevel marketing business.
If you are a creative or crafty person, you could sell your handiwork online. If you enjoy writing, you could start that novel or write freelance articles for magazines or start your own blog and make money advertising once you’ve built up a following. If you are handy, you could fix up and renovate a house and then sell it. Take a few minutes now to jot down 10 possible ways you could increase your income doing something you’d enjoy.