It’s the 21st century way of casting blame. When something goes wrong, we say that it’s a result of the global economic slowdown but we can’t blame everything on that. For most households, their income level has remained unchanged for the past 22 years and the trend is pointing towards earning less for the next decade.
In the past, career minded individuals went to work for a big company and tried to work their way up the ranks with each step resulting in a pay raise. That doesn’t happen anymore and as a result, we have to think of our careers differently. The fact is that incomes aren’t rising but there are ways to see your dreams realized.
Sound a little depressing. A new study by The Economist Magazine based on recent United States Census Bureau data show that the median earning group of Americans, those making around $50,000 annually, are earning the same amount as they did in 1989. In other words, if your household earned $50,000 in 2010, when adjusted for inflation, that’s what you earned in 1989.
If you’re below the median at the 10th percentile it’s even worse. Your household has earned roughly the same amount since 1967. That income is about $12,000. Even the nation’s highest income earners have seen this stagnation of income. They have earned roughly the same amount since 2001. Although it would be difficult to find lower income earners who have sympathy for the higher wage percentage, it is the rich who tend to drive the economy so when we see their income remain unchanged that has potential implications for the entire economy.
What you can do to Change
You may be happy at your current income level and if that’s the case, do the best job you can in your current position. Show yourself as the person who is indispensable and all you have to do is keep yourself marketable in case you are laid off.
If you’re hoping to move up the income ladder, there are ways to do that, most of which you most likely know.
Spend Less – You’ve heard it numerous times before but some people make enough to live an economic “good life” yet they spend so much that the good life evades them. The easiest way to live better is to get out of debt. That’s easier said than done but many are making that commitment. If they can do it, so can the rest of us.
Go back to School – More money follows more education. Those with more skills have more choices and more choices mean many more job opportunities. Going back to school to pursue something you love may increase your overall quality of life but if you’re looking to increase your income level, make sure your new degree will result in a higher paying job.
If you’re making $75,000 annually now but you’ve always wanted to be a teacher, you will spend money on an education and later get a job that earns you less money. From a purely economic perspective, that isn’t a good idea.
Start a business – Have a hobby that you love? Maybe you’re a factory worker during the day but love woodworking when you get home. Start a home based business and make a little extra money on the side.
Invest – Instead of spending, invest your extra money. Dividend paying stocks held for the long term will dramatically increase your income assuming you invest it correctly. If you don’t know anything about investing, get some help from a fee-based financial advisor.
Don’t let the fact that wages are stagnant detour you from bettering yourself financially. We live in an age where we have to be more responsible for our income so look at ways to increase you income through new opportunities instead of waiting for your company to give you a raise.
Tom Drake writes for Financial Highway and MapleMoney. Whenever he’s not working on his online endeavors, he’s either doing his “real job” as a financial analyst or spending time with his two boys.