People are often comparing their salary to friends, family or colleagues. We always have this temptation to know how much others make and how they can afford everything they have. For some, this is called envy — if you don’t do anything about it but just sit and whine, then it is considered envy. However, if you ask questions and try to find a way to make more money, then it becomes ambition.
Photo by Brooks Elliott via Flickr
I have been looking at people who are making more money than me to try to find ways to improve my financial situation. I noticed that most of them were not only making more money but they were also working longer hours! Making $100,000 a year is nice. But if you have to work 65 hours a week to make it, that’s only $29 per hour.
To compare everyone equally, I decided to redefine the hourly rate concept. Based on the fact that we all have 24 hours a day, it is up to us to convert this time into income. So instead of making $29 per hour, a person making $100,000 a year is making $11.42 per hour — this is our true hourly rate.
This way of looking at your income is depressing at first; especially if you are making less than $50,000. However, it also leads you to the solution of making $100,000 a year. If somebody really wants to make that much, he could simply work a ridiculous amount of hours and will make it. However, if he is smart, he will work in a way that money continues to grow even when he is sleeping. This is where passive income will come into play.
I want to make $100,000 a year and more. However, I am not ready to spend so much time away from my family in order to achieve it. Some people would say that it’s a choice. I say that it’s only an additional parameter in my plan to make such income. By earning alternative income, you can make more money without working much more in the end.
At the beginning, you will definitely work for nothing, and it will be more work than just your job. But if you look at your true hourly rate on a 24 hours / 365 days basis, it won’t matter. Even if your alternative income sources only generates a few hundred dollars a month, your true hourly rate will improve. Working on passive income would not be considered a waste of time anymore!
Other articles by The Financial Blogger:
- The Primerica Paradox: The Conclusion Part 2
- How To Find A Good Financial Advisor, Part 1 (of a 5 parts series)
- The Sad Truth About Investing
Contributor’s articles are written by members of the personal finance community. Each article was reviewed Moolanomy’s editorial team before its publication.