I’ve been reading a very interesting article from Toronto Life’s”Money” issue (June 2008), where a panel of youngish professionals discuss their financial lives.
As the below graphic shows, out of the seven panelists (read: journalist’s friends) only two of them make more than or around what they think they need to “live comfortably in Toronto”:
Note: the surgical resident said that she’s living way beyond her means because, although she *only* earns $65,000, in a few months she’ll be on $400,000 so the $200,000 pa is more of a divination than a quote.
Even the 38 year old lawyer who makes $200k doesn’t think he makes enough – he wants a 25 per cent raise in order to live comfortably.
The planner, the developer, and the surgical resident all think you need an incredible 50 per cent more than they make to simply be comfortable.
The simple truth is that no matter how much you’re on, you always feel like you want more. Your needs expand just beyond your resources, rather like your work expands to fill or exceed the amount of time you have.
If you want to play the salary game, you’ll always be the guinea pig; always running around the wheel and never getting any where.
If you’re the lawyer, and you do get that pay bump, suddenly your free market price goes up. In giving you that 25 per cent bump, your employer has told you how much you’re worth to them, but in putting that stake in the ground, they’ve also invited other would be employers to gazzump or over bid them.
Now, even though the lawyer is earning what he thought he needed to be comfortable, if he gets a call from the headhunter offering him a job worth $300k (another 20 per cent bump), suddenly he’s not comparing himself to his peers on $250k but the people he knows on $300k. And how much more comfortable they seem than he does.
As I’ve said before, it’s important to look at more than just a number when it comes to your career. Job satisfaction, benefits, average working hours, number of holidays and even how you enjoy your colleagues are all just as important as the final number that you put on your tax return.
However, something I noted for my next review is that the average of the “what do you need to live comfortably in Toronto” column is $160,833.33. 😉