Get Overpaid For What You Do

I mentioned my Asset Rich Income Poor strategy in passing in a Friday roundup a few weeks ago. I’ve been formulating it for some time now. I gave an outline to reader Harry in the comments. Now it’s time to put it in the open.

Step one in the strategy is: get overpaid for what you do.

What do I mean by overpaid? Everybody thinks they are underpaid. There are a ton of articles on the Internet about negotiating salary or a raise. You can also pay to attend training programs that promise to help you get a better offer or raise.

The fact of the matter is, many of us are overpaid. If you are reading this blog, chances are you are overpaid. Don’t tell my manager; I am overpaid, so is he, his boss, his boss’s boss, all the way up to the CEO.

I did some work that involved the cafeteria at my employer last week. For some odd reason I had to be there one morning at 6:00 a.m.

I’m not a morning person. I went to bed super-early the night before. I set two alarms to make sure I would wake up on time. I grumbled on the way there. I said to myself I must let my manager know I’m such a dedicated employee taking one for the team doing this work.

To my surprise I arrived at a busy scene. People were already busy working there. All wore their uniform. Men groomed and shaved. Women had their makeup and hair done. Everybody was busy at something: cleaning, preparing food, carting out items, counting cash in the drawer, preparing for opening for breakfast.

I realized it was just a normal day for everybody who works at the cafeteria. They start this early, actually much before 6:00 a.m., every day. A new employee was starting that day. I overheard she told the manager she lived one hour away, OK, maybe 45 minutes with no traffic at 4:30 in the morning.

I’m pretty sure I’m paid several multiples more than those employees are. I was embarrassed that I complained about my early start for one day when those other hardworking employees do it every day for much much less.

Look at what I do for work exactly. I talk to people, on the phone and face-to-face. I read. I type stuff into a computer. That’s about it. Many other people do the same. They also talk to people, read, and type stuff into a computer. Yet the pay can be vastly different. Some get paid much more for talking, reading, and typing.

Of course what you talk, read, and type makes all the difference. There goes the theme of my strategy: get overpaid for what you do, you know, talking, reading, and typing. If you are going to talk, read, and type, you might as well get paid more.

Let’s face it, working for pay is basically just trading time and energy for money. In my five full-time jobs so far in my career, I did not contribute to the advancement of mankind. I didn’t stop world hunger or save anybody’s life. I was just paid to make money for someone else — the owners in privately held companies, shareholders in publicly traded ones. If you are just there to transfer your surplus value to your employer, you might as well get paid more.

I read on the Bogleheads forum that someone is paid $80k a month for working 12 hours a week. Talking about getting overpaid!

How do you get overpaid? Find out which employers are paying big bucks, what they are paying for, and prepare yourself to get there. Whether it’s $200k or $122k a year, I have to say the government pays pretty well through its contractor to a 29-year-old with a GED. If they are going to waste money anyway, you want them to waste it on you.

Getting overpaid is the important first step in the Asset Rich Income Poor strategy. I gained a lot of respect for the hardworking employees at the cafeteria, but if I’m still diligently working there preparing nachos, it will be very difficult to advance to the next step — asset rich.

Thoughts? Are you overpaid for what you actually do? How did you get there? Chime in.

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Comments

  1. Harry @ PF Pro says

    Wow, first of all, I’m famous, thanks. I couldn’t agree more, I feel I’m totally overpaid haha. Everyone is always complaining how little they make but I make plenty of money! I don’t even know what to do with it all. In fact, I work as a vb coach on the side and do blogging/writing and make even more money and for that I feel I’m overpaid too.

    At my day job, I play basketball during lunch, show up whenever I want, work ~8 hours, leave early when I want, take long lunches, etc. I get my work done but all I do is sit at a computer playing with excel and some analysis software all day…

  2. KD says

    Overpaid relative to what? A person making $200K+ to $400K+ on the west and east coast could say – may be it is a good deal – kinda sort of overpaid. But in the middle of the country, the same person definitely is getting overworked and underpaid because they are not getting paid anywhere close to that. It is all relative. I negotiated a 27% raise in 3 stages in last 12 months, but I still feel underpaid compared to the coasts or for that matter compared to other less technical but more in-demand professions. But I am making more than before so I can’t complain. I keep working to improve myself and to do better.

  3. Harry says

    Relative to education attained. Relative to activities performed. If someone from Mars filmed everybody from 5 ft away, with no sound, and ranked everybody by compensation, what percentile do you stand among people who performed similar physical activities. Overpaid is good. It means you brought out more value from all those talking, reading, and typing. In the example I gave, the 29-year-old with a GED started his career as a security guard. I’m pretty sure he’s in the top percentile among others with a GED who started as a security guard at a similar age.

    With regard to higher pay on the coasts, I thought the conventional wisdom is that the higher pay does not fully compensate for the higher cost of living. If it does, people would be wise to move from underpaid middle of the country to the coasts. I think the opposite is happening. People establish a position on the coast and then move to the middle of the country, or even to a different country, for a lower cost of living and a better quality of life.

  4. TJ says

    KD—200k to 400k?! and here I thought 60k, on the coasts, would be considered ‘overpaid’ – at least for the talking, typing etc jobs. :)

  5. KD says

    “Relative to education attained.” Harry, don’t get me started. I know graduates from midwest who went to NYC to try their luck and took up nanny jobs for the Upper West Side folks. Imagine, if you are in need of a nanny in Upper West Side, your candidate choice begins with a minimum of a college degree who can probably speak 3 languages etc. Where else on earth would you have that kind of selection pool?

    I certainly agree with the statement, “People establish a position on the coast and then move to the middle of the country, or even to a different country, for a lower cost of living and a better quality of life.” Implicit in the statement is a driving force of demographics and not cost alone.

    The cost of living is most times a flawed comparison because most likely your lifestyle and demographics are very different. Living on the coasts, you would not settle for a car and a McMansion when you want to live in aloft and be in the city and also be living with roommates. Apples to apples yes, midwest might offer more. But then it also does not offer a few things at all.

  6. Simon says

    Currently I don’t think am overpaid for what I do so I guess its something I should probably be aiming for :) And yes, I agree that payment/income is rather relative to your location, what you do and even how you spend that money!

  7. Eric says

    I saw your other post about the person who complained about “crap like this” and I have to say I really disagree. My wife and I have been having kind of a rough time with our jobs, and your article really helped put it in perspective. Not that I don’t appreciate what low-wage people do, and I do realize that they work harder than I do. I see them coming in to clean the office building where I work; I’m leaving and they’re just starting a shift for what is often a second job.

    You often bring a fresh approach to different topics, which I appreciate. So, when people in the top quintile (the majority of your readers?) feel they are underpaid, or pay too much in taxes, etc., – good for you to look at it from the opposite side for a change!

  8. Jimbo says

    Well, I’m coming to the party a little late, but I thought that I’d put in my two cents worth, anyway. One of my clients makes all of the software contractors park in an area behind the building. It’s our punishment for making more than the salaried employees that work in IT. Adjacent to the parking lot, is a strawberry field. On 100 degree days, I dread getting into my car and having to sweat for a few minutes until the A/C kicks-in. The people that work in the fields have been in the heat for most of the day. Gee, have I got it rough! Am I overpaid? Sure! But, it hasn’t happened without taking some risks. I’ve been a software consultant for over 30 years now. Every decade there’s a major economic downturn in this country. And, when that happens consultants are the first ones out the door! Ah, but the other 9 years are the gravy train, man. During the good years, I sock away as much money as humanly possible in ultraconservative investments that will break even with inflation. So, if you truly want to be overpaid do the following: 1) Develop a skill that can be done not only as a salaried employee but also as a contract employee. 2) Get a few years of experience in a salaried job. 3) Save-up a year’s worth of expenses. 4) Get work as a consultant thru a broker on a W2 basis. 5) If you really want to be overpaid, market yourself as a consultant. This approach worked for me over the past 30 years as a software consultant. However, with the outsourcing of so many software contracts overseas, this may not be the best skill going forward. Each person has to figure that one out for themselves!

    • Greg says

      I love this line of thinking…..there i was, stressing about the end of a job with an I.T. outsourcing company. All my co-workers at other locations got picked up by the new outsourcing company, but not me. Granted, this was hard for me because I was at the biggest facility and it made no sense whatsoever. Eventually before my “end date” I posted my resume on Monster and within a week a recruiter called me offering me a job, MY JOB! lol! He told me about the job and what was require while I was dying inside, then asked, so what are you making now, I said 43 (meaning 43k per year) and he said, well this job pays 50 dollars per hour w2! I was blown away, got hired, started the job (never left and just kept doing what I was doing) for double the money! Gotta love it, am I overpaid, hell yeah, do I feel bad? Ahhh, maybe a little :-)

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