How to Know if You're Earning Enough Money?

Answer 1

Let’s face it -- none of us think we make enough money.

But really, is your empty wallet your boss’ fault, or are you broke because you don’t know how to budget your money?

Of course, checking your bank accounts in the weeks after Christmas might be misleading if you’ve overspent for the holidays. But if you find yourself constantly paying your bills late, or if at the end of the month, you’re having peanut butter Sandwiches for every meal, you may want to examine if your cash flow problem is your fault, or if you’re being underpaid.

After you’ve determined that you’ve sensibly budgeted your income, it’s time to find out if you’re being paid enough. The key, says the Bureau of Labor Statistics, is in comparing the salary you make to the averages, to see if you’re earning anywhere near what you should be.

1. Compare your salary to the national average. According to the Social Security Administration, the average wage for 2011 (2012 figures will likely be released shortly) was $42,979.61. Of course, not everyone makes that. It all depends on the job you hold and where you live. But the national average does give you a ballpark figure of what’s being earned nationally.

2. Check the BLS statistics about your occupation. The agency tracks occupational wages in 22 categories, including health, education and more. You can use these figures to compare what you make with what other people in your occupation earn.

3. What’s your area average? The BLS data will show what the average salaries are for people in your area, and you can also look at other areas, to see if it would make sense financially for you to move.

4. Look back and see when you last got a raise. Sometimes, time tends to fly, not only when we’re having fun, but when we’re working as well. And some companies, unfortunately don’t offer yearly cost-of-living payrate adjustments, let alone raising employees’ pay based on their hard work. If you’ve been working a year or more without getting a raise, that’s too long. As we all know, everything is getting more expensive, and the salary that fit your needs a year ago may not be enough now, given inflation.

5. Be brutally honest about your spending habits. Visit a site like Feed The Pig (http://www.feedthepig.org) to set up a budget and learn some budgeting techniques that will help you save money without feeling deprived.

Make the best of this New Year -- and do what you can to make sure you have enough money left over to enjoy your life as well as pay your bills.