Let me share with you an actual email I received from a former employee a few years ago:
I know I haven’t exactly lived up to expectations since I started, but in my contract there’s a clause that says I’m entitled to ask for a payrise each year. So I was hoping we could talk about it?
Let me point out a couple of things about this approach:
First, never use an emoticon when writing to your boss (even if he or she is 20 years younger than you).
Second, hope is not a strategy.
And given that we’re getting close to the end of the financial year — and, with it, annual performance review time — today I’m going to show you the easiest way to make more than a million bucks, with a simple five-step strategy that I call ‘Career Compounding’.
I’m serious when I say more than a million dollars. Let’s look at two 25-year-old graduates, each starting on $35,000 a year. One gets a 3 per cent annual increase, while the other gets a 5 per cent increase. The difference over their working life is $1.6 million.
Now, here’s the important point: the biggest source of wealth is your salary. Yet the truth is that most people are as unlikely to compound their salary as they are to earn compound interest. Instead, they look back after a lifetime of working and all they have is excuses.
Your Excuses For Not Earning More
Question: do you know what the biggest mistake most people make when it comes to getting a payrise?
Answer: They don’t actually ask for it.
Instead they come up with excuses like:
“Maybe my boss will notice if I put my head down and keep working around the clock”
Maybe, but it’s unlikely. Though it will definitely lead to you picking up the slack for your lazy co-workers, who sit on Facebook all day or waste company time arranging their honeymoon.
“I’ve done my job, as per my position description, so I’m entitled to a pay rise”
Actually, no you’re not. All you did was what you were employed to do. It means you held up your end of the bargain. That means you’re entitled to be paid what you signed on for. You don’t get promotions and above-average pay rises when you do your job — you get them when you go above and beyond to become a linchpin for your boss.
“I don’t know how to negotiate … I feel awkward”
Seriously, 90 per cent of the negotiation is done before you sit down with your boss. In fact, it’s done over the preceding 12 months. And if you follow my five-step Career Compounding strategy, the only awkward thing will be how much your boss gushes in the performance review.
Introducing: Career Compounding
Did you know that, on average, you’ll spend 90,000 hours of your life working.
That’s a huge chunk of your precious time on earth — add in sleeping, your daily commute, and sitting on the can, and there’s not much time left over. You’ll actually spend more time at work than you do with your family and friends.
And here’s the killer: odds are you are totally unfulfilled with what you’re doing at work.
According to a Gallup poll in 2011, almost two-thirds of Aussie workers consider themselves to be ‘emotionally detached’ from their employer. That results in them turning up, punching the clock, and doing the bare minimum to keep their job.
The solution is to stop being passive. If you’re going to devote 90,000 hours of your life, you want to make it pay — you want to Compound Your Career.
Step 1 — Commit to being the best employee in your company
The simplest way to become a multimillionaire is to commit to being the best at what you do. Very few people you work with have ever made that commitment. Those who do, get paid a disproportionate amount of money. Do you think a CEO works 200 times harder than a regular worker? Of course they don’t. And trust me, they’re sure as hell not 200 times smarter either. They’re just committed.
Step 2 — Make a list
Take out your position description, but this time look at it from your boss’s point of view. How does your job make her life easier? How does it contribute to your company? Most jobs can be boiled down to three fundamental tasks. Write them down. Then set yourself an ambitious goal for each task that you’ll have to stretch to achieve over the next 12 months. Write them down too.
Step 3 — Arrange a meeting with your boss (no emoticons)
Present to your boss your list of prioritised tasks, and your goals — and genuinely ask her for feedback.
You’re not doing this to be a brown-noser. You’re going to devote the next 12 months of your working life to this, so you want to be crystal clear that you and your boss are on the same page.
Once you’re both in agreement, ask her if you can have a follow-up meeting every eight weeks or so to track your progress.
Take notes on whatever she says, and for godsakes, smile.
Step 4 — Put your goals into your calendar for a daily reminder
You now have your ambitious 12 month goals. The key to progress is doing a little bit on them every day, and tracking your progress. You’ll be surprised how much you can get done by hitting your goals for an hour a day, rather than bitching about the boss.
Step 5 — Follow up with your boss
Never talk about money, or promotions, in these meetings.
Always talk about what extra you could do to help your boss. What can you do to make her life easier?
The bottom line is this: you want to frame it in your boss’s mind that you’re hungry, but humble. Be grateful for the opportunity to take on more responsibility. Then show her the daily progress you’re making towards your goals.
So that’s your 12-month Career Compounding Plan.
Now my original suggestion was that this could earn you a 5 per cent raise. But if you actually do these five steps, I think you’d probably get a 10 per cent raise.
Stop for a minute and think about what a difference that could make to your life.
Then shut down Facebook.
And do it.
Tread Your Own Path!