The Number One Secret to Making Money: Adding Value
Are you interested in learning my secret technique for making more money? Most people spend considerable time wishing they were earning more, but not very much time thinking about why they deserve to earn more. There is one foundational habit that you need to develop if you want to make as much money possible. No matter what you’re doing, you should always ask yourself: Am I just working or am I adding value?
Many people confuse the two concepts and exhibit a tendency to look at their lives in terms of how much work they’ve done. I’ll define work very broadly as “the act of doing something we don’t want to do.” Interestingly this broad definition is pretty much how people expect to derive their compensation. In actuality this metric has virtually nothing to do with how much you will, nor how much you should get paid.
If I go out in the yard, dig a hole and then fill it in, I’ve done some work, but that’s all I’ve done. I might feel like I should be paid for my inconvenience but I doubt my wife is going to agree with me. I haven’t achieved anything and I haven’t added any value. No one is any better off, so why should I be rewarded?
Many people tend to try to walk the line of providing only as much value as will keep them from getting fired from their job and think they’ve done themselves a favor. They don’t want to give a penny more value than they feel they’re being paid for. Aside from the fact that you’re unlikely to get a raise or promotion this way, you’re actually doing a worse job than you think. When your boss is determining your “value” he or she is probably adding in several bonuses of which you’re not aware:
- The time he or she would have to spend finding and training your replacement.
- The morale hit the team might take from your being fired.
- The stress, guilt and discomfort of having to fire you.
You have all those advantages on your side. If you’re still walking the line of just barely providing value even with those bonuses you’re probably doing a really awful job.
The key here is thinking long-term -- not simply reaching for the immediate gratification you can receive by putting in the bare minimum to get your paycheck. Overall, you will probably get paid in proportion to the value you add, even if it’s not in cash. At my first job as a computer geek, they were pretty strict about the hours being from 8 to 5. I didn’t much care for that and because it was a big corporation salaries didn’t move around that much so I knew I wasn't going to get as much of a raise as I wanted. You know what happened when I showed up at 10:30? Nothing. Because everyone knew they were getting more value out of me than they were paying. If they could make it up to me by looking the other way when I showed up late, then they were more than willing to do so.
I wanted to write about this topic early on this blog because I imagine I’ll refer to it in many future posts. People spend way too much of their lives trying to find ways of getting paid without adding value. Looking at your life in terms of how much you’ve worked versus how much value you’ve added is a great way to wind up getting poorly compensated for your time.