You have no doubt heard about the simplicity of being wealthy or growing wealth. Simple in text by difficult to achieve. Here it is, you have to save. You must also live below your means. You already know this, to gain wealth, you cannot spend all that you earn. With what you save, you can invest consistently and take advantage of opportunities when they arise. But this is only one side of the equation. The other side of the equation is your earnings. The more you earn, the more you can save and invest. So while money is not everything, earning more is an important component of building wealth and achieving financial independence.
The Equation
We know the equation. Becoming wealthy is a matter of money in versus money out. Wealth is a matter of earning versus spending. We typically spend a lot of time on the spending side of the equation. And yes, the spending side of the equation is very valuable. You have heard it before, live below your means and stick to a budget.
We rarely focus on the other side of the equation. We tend not to focus on the side of the equation relating to bringing money in. There may be a reason for this. While it may be virtuous to save and live below your means, trying to earn more may not be looked at in the same light. Typically, if someone is pushing to earn more they are labeled as a gunner, which has certain bad connotation. Further, many of us do not want to be known as someone that is chasing money. We want to chase our passions and if money comes with it, great. But you now what, there is nothing wrong with chasing money. There is absolutely nothing wrong with getting paid what you are worth. The fact is, you deserve to be paid in line with your skills and ability. If you are not being paid to a level commensurate with your skills, you should consider moving on to another opportunity.
Simple Facts
If you are going from zero to wealthy, you must earn. It is that simple. Now, this does not mean that you need to be making a million dollars each year. As you well know by now, you can become a millionaire on just about any salary if you save and invest smartly. However, if you are able to maintain your living standard and earn more, you will get there faster.
Earning More
We are no longer in a system where you can expect to work for the same company for your entire career. Whether it is a matter of being laid off, conflicts with your manager or simply getting a better opportunity elsewhere, it is likely that you will be switching jobs at least three times in your working life.
But if you are not ready to leave your company, just know that by staying at your current job you are guarantee to be making less than you would elsewhere. It may be counter intuitive but companies typically pay new hires more than their current employees. In some ways, while they may appreciate you as an employee, they are constantly looking to attract the best talent. This is not to say that you should leave your current position, especially if the benefits and the work load fits your lifestyle. However, if you are not happy where you are, know that leaving could be a financial benefit.
Live Below Your Means
But even if you are earning more, you must not allow lifestyle creep to take over. If it does, then yes you will have a better standard of living but you will be no closer to achieving your financial goals. The point is, while you are focused on saving and living below your means, also work on the other side of the equation. Focus also on trying to earn more. Whether this is by getting a new job or starting a side hustle. Increase your income to achieve your financial goals faster.
Conclusion
Do not only focus on saving and investing. Also focus your attention on increasing the money in. Focus on earning more. The more you earn, the more you can save and invest. While money is not everything, earning more is an important component of building wealth and achieving financial independence.
