That Decade I Earned $0
Being transparent with your finances online is interesting. I know it helps to see real numbers which is why I share everything, but there are obvious downsides. Like, all of the times people tell me that they wish they had my income.
I can’t help but think that if they knew the full story, they might not be so quick to take the positives weighed down with their accompanying negatives.
Sure, my starting salary at my first full-time job was $65,000 – after I negotiated it up from $58,000! I’m earning 30% higher than the average in my area, which is substantial. That’s in Canadian dollars – make sure you find your currency conversion before you get too excited.
The number on its own can be misleading, so let’s look into the details.
For nearly all of the first ten years of my working life I was also attending university full-time, with several casual and part-time jobs wherever they would fit. Over that decade, I earned roughly $130,000 – an average of $13,000 per year which is well below the poverty line in Canada.
Still wishing for that income?
Friends who started out earning $20,000 in a minimum wage job would have made over $200,000 by that point – assuming they stayed in the same position for a decade and were never given a single raise or promotion.
Even now, after two years of full-time work with my shiny new salary, I’ve just reached the $20,000, on average, that my friends started making 12 years ago. I estimate that I won’t hit a $65,000 average until I’ve been in the working world for at least 20 years.
Adding in my $130,000 of student loan debt to that total, I’m actually at a net of $0 over ten years.
It will take me almost five years to pay off my student loan debt, which requires minimum payments of $1,300/month – 1/3 of my net income. I won’t be finished until I’m 32, a full 14 years after I started university but six years earlier than if I would have followed my original repayment plan.
Not to mention the years of compound interest I missed out on by delaying retirement savings! Ouch.
I feel behind in many ways, and it will be a while before I’ve caught up. That’s not something I focus on, but I think outlining these factors is important to understand the full picture.
I don’t want to sound ungrateful for my opportunities. I’m very privileged to have the education and experiences I did. When I do catch up, I’ll have much more financial stability than most. I just want to put my current earnings in context, and hopefully encourage others to ditch the unhealthy comparison habits that we all seem to fall into. It’s pretty freeing, actually. I know this because I used to envy the salaries of some of my friends too – until I stopped to think that they were often putting in longer hours in higher pressure situations, traveling away from their families for extended periods of time, or working in dangerous conditions.
There’s always more to the story than a number.