Your Paystub Lies

Look your paystub in the eyes and ask it how much you make.

It won’t be able to meet your gaze when it responds, because it’s not telling the truth.   You earned quite a bit less than it says.

This is due to the hidden costs of employment.

Lawyers spend money on suits and drycleaning.  Parents drop kids off at daycare.  Then there’s driving — miles put on your vehicle, increased maintenance due to high usage, and ultimately the cost of a replacement.  Maybe you have to give gifts to co-workers or periodically go out to restaurants  or dinner with folks and pay your own tab.  Everyone’s got their list.

In addition to all of these expenses, if you’re a salaried worker, there’s a strong chance you’re putting in a lot of uncompensated time.  Every day, you’ll be getting ready for work, shaving or applying makeup, putting on your outfit, driving to work, maybe taking an unpaid break, then driving home.

Once home you may be checking email or still thinking about work.  It takes most people an hour or so to put the day behind them, and this is frequently with the aid of chemicals which cost money.  Maybe your day was so lousy that you ‘deserve’ a night out.  Now your monthly food costs are rising too.

If your job requires travel, there’s a good chance that you’ve flown a couple of red-eyes or Sunday afternoons without getting any extra pay, all for the sake of appearing to be a good little employee.

Back to that paystub.  It’s lying to you because it hasn’t factored in all of the unpaid work or uncompensated spending that you engage in every single week.  You’ve worked more hours and earned less than it says.

When you become interested in taking control of your financial future, one of the first things to do is perform a full financial reckoning.  Part of this exercise will be to determine your Real Wage.  This number will tell you how to value your time.   Check out the real hourly wage calculator on MustacheCalc to help determine yours.

Some fair warning.  Taking an honest look at what you’re actually earning is bad for the health of the relationship between you and your job.   In 2002, when I first ran the numbers for myself, I saw my hourly pay drop by a third.  That was the beginning of the end of us together.




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One Response to Your Paystub Lies

  1. So very true. It costs quite a bit to work a traditional job. And the number of times that the dollars you actually *make* is taxed is, well, downright frightful.

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