The average Australian will agree that living costs are continuing to rise. The Australian Bureau of Statistics (ABS) found that in 2018, the cost of living rose by over 2%, which is the highest recorded growth for almost four years.
With workers feeling the pinch of increased housing prices, sky-high utility bills, childcare costs, and more, there has never been a more important time to increase your salary and stay ahead of these rising prices.
How much do you really need?
The ABS reports that approximately 50% of employees earn between $2,860 and $6,552 per month (before tax). The average living expenses are approximately $3,000 – 4,000 per month, depending on location.
Once taxes, superannuation, housing expenses, utility bills, and groceries are paid, only small amounts are left for the average Australian to save, invest, or even spend on discretionary items. To get ahead and have financial security, workers need to be saving and investing regularly.
Figures show that 47% of baby boomers in the second-lowest income quartile will run out of superannuation in their lifetime, making it imperative to have extra funds to invest or contribute to superannuation for your future.
The problem that many Australians are finding is that there is simply not enough money left once essential living expenses are covered.
Practical ways to increase your income
Everyone would like extra income in their pockets, but nowadays, it’s not only a want – but a need as well. Increasing your take-home pay is essential to reach savings goals quickly and allow for a financially comfortable life.
There are several ways to increase your income. You could earn a pay rise, accept a promotion, change companies, switch industries, or even start a side business.
1. Getting a Promotion
One of the best ways to increase your salary is to get a promotion within the business that you’re employed by now.
Four ways to get a promotion:
- Ask for it! Performance reviews are a great time to discuss your role and a potential move upward, or you can schedule a meeting with your manager. Take note of any achievements you’ve made in your current role and where you’ve been taking on more responsibility. Use this information to have an open discussion about your future in the company.
- Be an engaged employee in the workplace: Put your best foot forward. Contribute to discussions, volunteer to work on other projects, or help team members with their work if needed.
- Build a strong educational foundation: Even if you didn’t start with a formal qualification, it’s never too late to get one. You can add to your training and knowledge via professional development opportunities or diploma qualifications. An American study found that 70% of employers believe it is vital for workers to continue learning, to stay up to date with changes in their role or industry. Showing a commitment to ongoing learning demonstrates to your manager that you’re serious about your role.
- Demonstrate leadership: Even if you’re not currently in a leadership role, show your managers that you are capable of leading by demonstrating those qualities in the workplace. Ways to do this could be putting your hand up if asked to lead a team, helping out newer team members, or starting an office initiative like a charity event or recycling program.
2. Secure a Pay Rise
While receiving a promotion is a great way to achieve your salary goals, it’s not the be-all and end-all. If you’ve been working hard in your role and demonstrating value to the company, it may be time to ask for a pay rise.
Make sure to research current market trends of salaries in your industry and consider the achievements you’ve made during your time in the role. This could be taking on new projects, helping to procure new business, contributing positively to team morale, or taking on extra responsibility.
Just by asking, you’re already one step closer and demonstrates that you are committed to your performance and the company. Studies found that over 70% of those who discuss a pay rise with their manager, end up with one, so it can’t hurt to try.
3. Switch Jobs or Industries
If you’re not satisfied with your salary or struggle to see opportunities for growth in your current career or company, it may be worth doing extra research. Look into the average salaries within your industry (including management and executive roles) to see whether the financial pay off of working your way up is viable.
You may find that switching careers and taking on formal training in a different industry could help you reach your goals. The investment in your education is often worth it for a higher earning potential.
You could also analyse how to apply your current skill set to a different, higher-paying industry. Many courses allow for Recognition of Prior Learning so you can top up your knowledge with a diploma, and quickly open doors in a different world of work.
4. Start your own business
Being your own boss is a goal for a lot of people. Having full autonomy over your business and role is an attractive prospect. Plus, your earning potential isn’t capped. You get out of the business, what you’re willing to put into it – and this includes your income.
Consider if your experience may lend itself to starting a business. Or, perhaps you could pursue a hobby or interest by upskilling with formal education and training. You will then be able to transfer that hobby into a side hustle that will not only provide new opportunities but also put a few more dollars in the bank.
Increasing your salary is the single easiest way to increase financial security and provide long term solutions to your money goals. Whether you ask for a raise, a promotion, or you decide that going it alone with your own business is the right path; there are plenty of options available. First, look at your current place of work. You may be surprised at what opportunities already exist or what a little extra education could help you achieve. If you’re looking to upskill to reach these goals, there are plenty of flexible online courses in a range of industries to help you achieve the salary or dream role.