海角大神

Everyone鈥檚 job has some sort of expense associated with it.

For example, my current work pretty much requires me to have an internet connection at home and at least one computer. If I don鈥檛 have these things 鈥� and I pay for them out of my own pocket 鈥� I can鈥檛 create posts and get them on The Simple Dollar. I would have to go elsewhere to post, which would create its own expenses.

I鈥檓 fortunate, though. My current work has no wardrobe requirements (which means no time or money spent shopping for work clothes, getting things dry cleaned, etc.), no commuting requirements (which means no time spent commuting, nor money spent on fuel and auto maintenance and auto replacement), no travel requirements (which means no time spent flying elsewhere, no nights spent away from home, and no incidental costs), no extra child care costs (because I can watch them from home if needed), and no social obligations to eat lunches outside the home or get drinks with coworkers.

My previous work had all of these expenses. Although it wasn鈥檛 an everyday thing, there were certainly days where I had to dress well for work. I had a commute that took me around twenty minutes each way. I had to travel three or four times a year, with those trips varying in length from three days to a week. I had to keep my children in daycare. I ate out with my coworkers a few times a week and went out with coworkers or other professional acquaintances once a week or so.

One way to really dig into this 鈥� a method that I鈥檝e described before on here 鈥� is what I call the 鈥渢rue hourly wage.鈥� All you do is sit down and figure out two key numbers.

贵颈谤蝉迟,听how much time do you invest in actually working聽plus聽time spent in extra activities related to work, like commuting, travel away from your family, shopping for work clothes, going out for lunch, going out for other social events in the evenings, and so on?

Let鈥檚 look at an example. Let鈥檚 say you make $50,000 a year at a reasonably high-stress job. If you assume you work 40 hours a week with two weeks of vacation a year, your hourly rate is nominally $25 per hour. Not bad, right?

You might work forty hours a week with two weeks of vacation a year, but let鈥檚 say you鈥檙e commuting half an hour each way per day (another five hours per week). You also go out to lunch with coworkers as part of a 鈥渓unch break,鈥� which eats three more hours per week. You have to properly wash your work clothes, which eats another hour per week. What about the extra time you spend thinking about work or stressing out about work? Do you have to spend some 鈥渄ecompression鈥� time when you get home? Let鈥檚 give you another two hours per week for this. Twice a year, you go on a trip that takes you away from your family, which adds up to another eighty hours spent away from home per year. Twice a month, you go out with coworkers in the evening, adding up to another sixty hours per year. There鈥檚 also the time spent dealing with extra car maintenance and fueling stops 鈥� let鈥檚 say another ten hours per year. That鈥檚 an extra 700 hours per year that you鈥檙e not getting paid for 鈥� more than athird聽more than you鈥檙e on the clock.

狈辞飞,听how much of your salary is devoured by your job?聽If you drive an extra 15,000 miles per year in a 25 miles per gallon car, that鈥檚 600 gallons of gas聽plus聽five additional oil changes聽plus聽15,000 extra miles on your maintenance schedule聽plus聽15,000 miles closer to a car replacement. The federal government estimates the cost for all of this at being around $0.50 per mile 鈥� I鈥檒l call it half of that and we鈥檙e still looking at $3,750 a year. Do you need work clothes? Let鈥檚 say this person needs about $250 in clothes per year. You eat out with coworkers twice a week for social reasons, which eats up $10 per meal, or $1,000 per year. You go out twice a month with coworkers in the evening and burn through $25 each time, which adds up to another $600 per year. Let鈥檚 say you have the American average of two kids that require some after-school care which costs $50 a week (we won鈥檛 even get into the nightmare of daycare for younger kids) 鈥� that鈥檚 $2,500 a year. That鈥檚 $8,100 in expenses just to keep you going at work.

What about taxes and so forth? You should be looking at your after-tax salary, so let鈥檚 lop 20% off your salary when doing this calculation.

So, your starting salary of $50,000 gets 20% lopped off with taxes and $8,100 in additional expenses chopped off, so you鈥檙e left with a salary of $31,900. You鈥檙e actually working 2,700 hours per year, so your actual hourly wage at work isn鈥檛 the nice $25 you thought it was.聽It鈥檚 actually $11.81.

Feel free to calculate this number for your own purposes.聽Figure up how much time you actually spend doing things that are caused by your job as well as all of the extra expenses associated with it. You might come up with a shocking hourly rate.

This isn鈥檛 to say you should live or die by this number. You shouldn鈥檛.

The important thing to keep in mind is that聽salary doesn鈥檛 represent the real value you get out of a job.聽A job that earns $50,000 a year but has all of the requirements above might actually net you less for your time than a $28,000 a year job that is within walking distance of your house, has extremely casual dress, and allows you to walk out the door each night without a second thought.

Income isn鈥檛 everything. It鈥檚 just as important to have a job that doesn鈥檛 nickel and dime you, doesn鈥檛 fill you up with stress, and doesn鈥檛 quietly eat up more and more of your time. Those 鈥渇eatures鈥� eat up your income like nobody鈥檚 business.