Do you wand to get a raise? Getting a raise may sound simple, but there is a whole chain of events that eventually leads to rise of salary. The income we earn is the compensation for the work we do. Since the work is creating a certain value, basically the salary is the method of exchange of one value for another. The employer is giving the salary to the employee in exchange for the value of work that is given by employee. In this process, both sides do what is best for them. Employer wants the work to be done for as less money as possible. On the other side, employee would like to sell the labour at the highest possible price. The real price of work depends of the supply and demand of both employers and employees.
OK, if you are stuck at the place where you are now with your income, what is that you can do to give yourself a raise? Most of the people want a higher income, unless if somebody does not care about material world needs. There are several strategies can be chosen in order to obtain a higher income.
Ask For a Raise
The first solution for getting a raise is the most obvious. In case that you are employed, you are already receiving a certain salary. Technically, you “just” need to increase it. This is not simple at all, but we must be aware that it is possible. In order to do it you must understand what is necessary to get a raise. It will not come up just like that. It will not come simply because you want it. Especially it will not come because the employee is very happy or crazy and want to give away money for nothing. It is very important to understand that there is never something for nothing in the life. There should be a reason for everything.
Therefore, if you want a raise, you must provide a reason. The good argument for earning a raise is the additional value that you can provide during the work. This means that you should not only do your work, but also you have to provide additional value through extra work, innovation, improvement of processes, cutting expenses, proposing changes and any type of initiative that will build the organizational efficiency of the company. The extra value provided can give you a raise on the current position, or promotion to higher position that will give you a raise.
But the story does not finished only with the providing the additional value. In order to get what you deserve, you need to do self promotion of the work you do. Sometimes the employer will recognize your effort and reward you. More often, either it will not recognize you or it will recognize, but ignore the possibility of raise. The employer will not easily give the raise, unless understands that it is necessary. Basically, the facts that you are the contributor of value and there is the risk of leaving of the company, is the best combination. The art of earning a raise is the combination of creation of additional value and self promotion.
Change a Job
In case that all options with the current employer are explored, looking for another job can be a solution. If you managed to give extra value, but the raise doesn’t come, probably you should look for another job. Changing a job is always related to the risks. But at same time it gives you several opportunities.
First opportunity is a chance of finding another job with higher salary. This especially reflects to the fact that it is easier to negotiate the salary level during the interview, than asking for a raise later. If you are representing the profile of candidate that employer is looking for, you have good chances of negotiating desired salary.
Second opportunity lies with your employer that you plan to leave. We said that the raise comes from the value you give and the risk that you will leave. This means that entering the process of resignation can trigger the current employer to reconsider salary adjustment in your favour, just to keep you.
Build Multiple Income Streams
You can give yourself a raise not only but increasing the level your income stream, but also through building additional streams. Multiple Income Streams can provide you with additional income, on top of the main income source. There are countless possibilities to obtain additional streams. For example, you can expand your professional activity to the after hours. If you are expert in some area, you can provide your service after work. Of course, unless it collides with your current employer. On the other hand you can provide additional earning through activity that is absolutely not related to your main profession. Building of multiple income streams can have positive and negative impact.
First obvious positive impact is the overall increase of the income. More streams of income should bring more income than single source. Second strong benefit of multiple streams is the security of income. If one source reduce or disappear, you have an alternative source of income. Multiple sources bring less risk than single source.
Negative impact of this system is additional time and money. Additional streams will not come just like that. You need to invest time and effort. In most of the cases you need to invest money as well. Justification of additional spending of effort, time and money should be based on your personal strategies and goals. If you are in early stage of building of your personal materialistic foundation, than effort is probably justified. But if you have already built a certain level of wealth that provides you safety, more private time can be the priority.
After all, multiple income streams do not necessary mean that you have to spend a lot of time and effort. For example, if you accumulated a certain amount of money you can invest it into Passive Income Streams. Passive income streams like interest, dividend and rent, requires a lot of money, but relatively little time.
The most optimal combination of multiple income streams is individual, since everybody is having own ideas and priorities. Probably the good solution is having a main income stream related to profession, and several smaller active and passive incomes. Give your self a raise through additional streams of income.
Cut Down Expenses
No matter how much you earn you can always be broke. It is always easier to spend than to earn. Therefore, efforts related to improvement of personal wealth should not only be related to maximizing the incomes, but also to optimizing the costs. If you waste more than you earn, than no raise can help you. Expenses are something that is inevitable, but is controllable as well. If you try to summarise your costs of the single month, you will see that there are some costs that are not that justifiable. Why not cutting those costs?
It is dreadful when you look how much you earn in a long period, say 10 years, and then compare it with the value that you held. Most of the earned value disappears. Cutting costs can increase the residual value.
Think about your habits that are drying your Wallet. It may look impossible to quit smoking, eating out every day, or buying the bunch of magazines. But if you calculate these “small” costs on the long run, you will find a significant amount of money that you can take as a raise that you are giving to your self. Reduced costs equal to rise of income. If you cut unnecessary spending you will suddenly get a raise.
Home Budget Planning
Finally, all elements of personal financial management need a certain method of management. Home budget planning does not have to be very sophisticated, with the use of expensive software. Even a plain Excel spreadsheet can help you in tracking of your incomes, period expenditures, ad hoc major spending, saving and investment.
It is said that the culture of the individual is the way of behaviour when nobody is looking. So, if you can not control your spending urge easily, try establishing the monitoring of your personal budget. If you start monitoring your financial incomes and outcomes, automatically you will start to be careful more about the way how you spend the money. Even if you start to think about spending of our money, you will start to think smarter about your budget. There is no need that somebody observes you in order to change you. Observe yourself and become more financially wise.
As it is obvious from these examples, there are many methods of “getting a raise”. It is not that impossible as you may think. It is not true that it is beyond your control. You can influence your personal finance in many ways. There are so many opportunities to earn a raise.
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