14–Lever #1: Your Income (Part Two—Show Me the Money)
The salary and wages stuff
Most people don’t work for fun; they do it in return for a wage or salary—an income to live on. That doesn’t mean work is never fun or satisfying, but it’s why one author titled his book It’s Called Work for a Reason.
Did you know the Bible says employees should be paid a fair wage? Check this out (and take a look at Luke 10:7 also): “For the Scripture says, ‘You shall not muzzle an ox when it treads out the grain,’ and, ‘The laborer deserves his wages’” (1 Timothy 5:18, ESV).
Since this article is about work and income, here’s our Financial Life Equation (FLE) again, and as before, see where income fits. And by way of reminder, it’s the sum of your earnings over many years (∑It+i ):
Or if you prefer: Future wealth = Starting wealth + Sum of all income (∑It+i ) – Sum of all taxes – Sum of all giving – Sum of all living expenses + Sum of interest earned – Sum of interest paid
Note that in the formula, income is the amount that gets added to current wealth each year before anything else is added or subtracted. When it comes to building wealth, it starts with Wt , but unless your starting wealth is high (generating a lot of passive dividends or interest income), the only way your wealth will grow is with regular income and will also depend on how you pull the other levers in the equation.
If income is high and grows steadily, wealth will increase, especially if the other variables that can reduce residual wealth (consumption, taxes, and interest expense) stay relatively constant. In other words, if your annual income rises 20% but your spending only goes up by 5%, you can pocket the difference (15%).
The opposite is also true, at least mathematically speaking. If your income starts relatively low and doesn’t increase dramatically, you will still be okay if you pay attention to the other variables (a.k.a., “levers”), especially consumption, taxes, and interest paid.
If you want to be a generous giver, one way is to consume less than you earn, save some, and still have more to give.
So I have to state the obvious: some careers typically pay more, sometimes much more, than others. There seems to be a close correlation between the rigor, complexity, and difficulty of training for a particular career and your income once you’re in it.
Engineering, medicine, actuarial science, and computer science are challenging fields. If you want to study set design in the theatrical arts department, that’s fine. I like plays, and I like them even more with nice sets. But it doesn’t require the years of complex math and science courses that other majors do.
In reality, relatively few students are willing to endure the hardships of STEM curriculums to master those subjects. So it shouldn’t be a big surprise that those who do tend to be more highly compensated after they graduate; it's simple supply and demand economics.
That doesn’t mean a theater set designer (I think that’s a thing) can’t earn a living; they probably can if they get the right job. But they will not earn as much over their lifetime as a skilled electrical engineer. It’s also possible that their financial life will be more challenging than the average college graduate’s.
Will they enjoy their work? Probably, but they may not enjoy the daily financial struggles that come with it.
The hourly wages for the skilled trades (plumbers, electricians, welders, HVAC techs, etc.) can be very high. These jobs' monetary incentives may compel some to bypass college (with the time and expense) and go that route. If you are a business grad, you could run an electrical company. If you get the right personnel around you, it might work (lots of great tradespeople are not good at the business part of things).
If we think of all this in the context of our FLE, it means that some of the other levers must be pulled extra hard to progress in building your net worth.
As I often do, I want to offer a word of caution. I know many people want to chase the highest-paying job they can find in their field. But I think we have a problem in our current economy. Many high-paying jobs rely primarily on smart people's ability to work with a computer, manipulate numbers in a spreadsheet, do a cool PowerPoint presentation, send nice emails, and navigate six layers of management.
I have had jobs like that myself and did them reasonably well. Still, at times, I thought, “I’ve worked hard, but it’s difficult to see what I’ve actually accomplished.”
The problem is that many white-collar jobs do not have a direct cause-and-effect relationship between the work inputs and the resulting outputs. Double, double, toil and trouble, and nothing to show for it except approbation and perhaps a nice bonus. Sure, the income, bonuses, and stock options are great (since money isn’t inherently bad). But should there be more to work than that?
I don’t want to get too far off track here and be seen as suggesting that there is good work and bad work, depending on the inputs and outputs. I have already established that all (ethical, moral) work is good and a gift from God.
In addition to the income considerations, try to find a job that offers rewarding work rather than just a day of distractions or adult day care. The paradox of modern work is that the most prestigious jobs often involve the least actual work. If you can grind on tedious tasks longer than anyone else, you can get paid much money. You gain material riches but may not find it intrinsically satisfying.
So what’s the solution? For some, it might be a career change. However, for most, it will involve being more thoughtful when finding work in the first place. If we put as much effort into looking for a high-paying job as we did in finding work that will make a real difference, we will be in a better place overall.
But we all need a biblical perspective on work. We must recognize that there is no “perfect” company or job and that our responsibility is to “work as unto the Lord” as we seek to serve others in the workplace. It just may be that serving provides the most satisfaction.
For reflection: Consider your job; did you take it mainly for the money? Is your job fulfilling? Is it satisfying? What is it missing? What can you do to change the situation, or does your heart attitude need to change?
Verse: “And whatever you do, in word or deed, do everything in the name of the Lord Jesus, giving thanks to God the Father through him” (Colossians 3:17, ESV).
Resources:
“Redeeming Productivity” by Reagen Rose
Redeeming Productivity (website)