August 31, 2010, 5:00 am

How To Get A Raise… After a Raise!

by: The Financial Blogger    Category: Uncategorized

At the beginning of the year, I wrote about my 4 financial goals for 2010. I had selected the following:

#1 Pay off the loan from my parents (done!)

#2 Increase my online income by 50% (work in progress)

#3 Finish in the top 10 financial planners in Montreal (work in progress)

#4 Increase my base salary by 15% (this is where my challenge was).

When I reviewed my financial goals in June, I told you that I just got a huge raise of…drum roll…..1.67%! This was basically just enough to cover inflation (not really in fact since the 1.67% salary raise is taxed!). Therefore, I was pretty far away from my 15% raise this year.

Why Did I Think I Was Able To Get a 15% Raise During A Recession?

I’d say that no matter what the economy looks like, no matter if your employer is hiring or laying off people, there are key employees that will keep the company, the department or the team alive. In my branch, I am the key employee right now as I am enjoying my best years as a financial planner. I don’t mind working hard and I don’t mind spending hours making cold calls and delivering my sales pitch.

At the beginning of the year, I looked at where I wanted to be in 12 months. The objective this year was pretty simple; get a bigger portfolio in order to get a bigger pay check. When I looked at the bigger portfolios in the downtown area, I noticed that they were making about 15% more than me. Therefore, I thought that I could get a 15% raise within the next 12 months.

How to get a salary raise after a raise?

This one is not as simple as knocking on your boss’ door. In fact, if you are not the top producer in your department, I doubt that the following method would work out. It requires a lot of tact and can be quite risky if you abuse it.

#1 Make yourself interesting to other managers

During the past 18 months, I have spent a lot of time talking to other managers so they get to know me and so they remember my name and my face ;-). It was very important to build my network slowly but surely to make sure I can make a quick move if necessary.

#2 Bring in the numbers

Having a good network will get you far, but bringing in the numbers and becoming the key employee in your department will get you exactly where you want to be. So for the past 2 years, I have worked very hard to bring in solid numbers and demonstrate consistency. A good year means nothing in a lot of fields (just think about a hockey player who scores 30 goals in his rookie season… he might never do it again!). So most managers won’t agree to give you a high pay check right after a good year, they want to hire someone with a good work ethic and that is able to do consistent effort. Those are the true keys to bring the numbers.

#3 Apply for a bigger job

During this summer, there was an open position for a financial planner with a bigger book downtown. Due to my great network, I was able to know it before it was posted (I knew the guy that was leaving) and I due to my past results, I was called for an interview.

#4 Make sure you boss knows you applied

Right after I sent my resume for the job (not before because they will think that you’re bluffing), I went into my boss’ office and told him about it. I was straight forward and he wasn’t surprised by my decision.

#5 Open the door for negotiation

This is where the fun starts. When I told him that I applied and that I wanted to work in another branch, I opened the door for him to make a counter offer. I told him that I was super happy where I work (which is true) and that I would prefer to stay here. However, making more money was the real reason why I applied because my wife is at home and I have 2 kids (here again, a bit sentimental but always use the truth!).

#6 Set a time frame

I also told him that if he was able to match my salary, I would not go to my interview which was scheduled in 2 days. Therefore, he had 48 hours to think about it knowing that if I had to go to the interview, chances are that I would switch branches.

You got the raise? Then 2 more things you need to do:

Once I got my raise, there are 2 important things I will do:

#1 shut my mouth (just telling people that you had a nice agreement and that you are happy is sufficient, you don’t want to open Pandora’s box)

#2 shut my mouth (during the upcoming years, I won’t have much room to negotiation for a higher salary. This is why I will have to shut my mouth and know the limit of generosity from my manager 😉 ).

So I’m done with 2 of my 4 objectives for the year! I still have 4 months to complete my goals for this year :-D.

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August 30, 2010, 5:00 am

Avoid These Lifestyle Inflation Culprits

by: The Financial Blogger    Category: Personal Finance

This guest post was written by Go Banking Rates, bringing you informative personal finance content and helpful tools, as well as the best interest rates on financial services nationwide. Follow them on Twitter at @GoBankingRates.

The feeling that accompanies a new job, pay raise or big bonus is hard to beat. Suddenly, you can afford all the things that used to fall beyond your standard of living. The nicer car, smart phone and the bigger apartment–now they can finally be yours since you have been working so long and hard for them.

Have you ever stopped to consider whether these upgrades are really necessary, though? Do you actually need to spend more money or simply assume you’re supposed to because you can? This relationship between an increase in income and subsequent increase in expenses is referred to as lifestyle inflation and it isn’t always a bad thing. However, lifestyle inflation can rob you of true wealth and a secure future if you’re not careful.

It’s normal for the cost of your lifestyle to inflate when you move from one life stage to another, such as graduating college or getting married. That’s fine as long you continue to save more than you earn and are putting away plenty in a saving account.

On the other hand, if you’re living paycheck to paycheck in order to meet the financial demands of your life, sooner or later you’ll be faced with an abrupt and sharp downgrade that will likely involve high levels of debt, too. The following are a few of the most common lifestyle inflation culprits that can lead you down a rocky road.

House That’s Too Big

Many people often fall into the trap of buying the biggest house they can possibly afford. This sets them up to encounter problems if the budget gets tight.

Lenders won’t tell you, but they tend to approve mortgage loans based on what you could theoretically afford, not what you should really be spending. Just because you are approved for a home loan does not mean you can truly afford to buy the home. If there is any dip in income or a flood of unforeseen expenses, making the huge mortgage payment on time when your funds are already stretched thin becomes much more difficult and you run the risk of losing your home.

Ridiculous Car

Cars are some of the worst purchases because they depreciate in value so quickly. You literally start losing money once you drive away from the dealership. Then there’s the gas, the maintenance and the thing people tend to forget most often, the insurance. A vehicle can eat up tons of your money and it’s easily avoidable.

That doesn’t mean you should doom yourself to an 80’s sedan with scuzzy upholstery and dents in the bumpers. Just steer clear of the other extreme. A brand new sports coupe with a V-8 Hemi will definitely make you happy, just not for very long.

Empty Savings Accounts

You know the saying pay yourself first? Cliches become cliches for a reason–because they’re true. If you are not consistently saving money, and a pretty big chunk of it, you’ve got a problem.

Of course, there is no one-size-fits-all solution when it comes to saving. The amount you should be putting away depends on you age, income, etc. However, the general consensus seems to be that a rough 20 percent is a healthy number. Keep in mind you should have both an emergency fund and a retirement plan, too, and it seems retirement requires more than the 10 percent we’ve been told would be sufficient.

Lifestyle inflation is usually the result of wants taking precedence over needs. There’s nothing wrong with making a lot of money and spending on expensive things you like, but you have to balance income and expenses so there is always a healthy buffer of savings in between. Remember, an increase in income is an opportunity to save more and work towards true financial freedom.

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August 26, 2010, 6:00 am

Why Are College Students Stressing About Economy?

by: MD    Category: Career

The recession has affected many people across the globe. Wealthy individuals lost fortunes. Individuals with lucrative potions lost their high salaries. Highly profitable industries have gone extinct. Just one thing has me really curious though. Why is everybody stressing about the economic climate. Alright seriously, why are college students stressing about the economy?

I really don’t understand why so many college students are so stressed out about the economy. However, many college students that I still communicate with are nervous about the state of the economy. This is why I wanted to share some tips for current college students that are stressing about the current economic climate:

Stay in school longer.

If your ability to earn a decent living after your graduate from college has you concerned, then you should consider staying in school longer. An economic downturn is the perfect time to pursue higher education and to go for a Graduate Degree in the field of your choice. A friend of mine recently realized that it would be difficult to find work in the field that he earned a degree in. Therefore, he took this as an opportunity to follow his passions and to pursue an education in journalism. No matter where you stand right now the chances are that you could benefit from taking a few additional courses. This will also give you some more time to decide what path you’ll want to follow once you do get out of the college system.

Excel in your studies.

Another solution for those concerned about finding work after college is to channel this energy to attempt to earn exceptional marks in college. These exceptional marks could either ease your entry into further education or they could help you stand out from the intense competition in the workplace. Regardless of the reasoning, focusing your energy on your studies will always benefit you much more than stressing about the economy or life after college.

Work for free.

If you work for free you won’t have to stress about your salary at all because you won’t have one. Instead of going through dozens of job applications, you could find a firm that will allow you to hone your skills and make yourself more valuable as you search for that dream job. Plus it’s much easier to find and work a volunteer position after college then it would be later on.

Start making money on your own.

Adversity often does equal opportunity. I figured that I would use the rough economic shape to start working on helping others with their finances and money management skills. I figured that strong money management skills would always be a plus, no matter what state the economy is in. The question then is, what problem can you solve for others at this current time? If you find a problem to solve, you could potentiality use the economic state to your advantage. The world always needs more entrepreneurs. Instead of worrying about the recession you could spend your time on trying to start your own business.

What advice would you share with current college students that are worried about the current economic situation? Do you think that college students should be stressed by the state of the economy?

Img src: Ed Yourdon

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August 24, 2010, 5:00 am

This is What I Call Passive Income

by: The Financial Blogger    Category: Alternative Income,Make Money Online

I am writing this post on my deck, admiring a beautiful afternoon outside while my kids are sleeping. I just finished building a nice fireplace in my yard and I have decided to pull out my laptop for the very first time since I am on vacation (it’s my second week already!). I haven’t have to work much over the past 2 weeks and still, my online income is coming in… this is what I call passive income!

When I go on vacation, my wife has imposed a rule; no blackberry during the day and no laptop either. I can’t say that I find her too rough with me since vacation should be used to disconnect from everything and enjoy your time. Since today she is taking a nap with the kids, I have decided to enjoy my afternoon with a nice bowl of ice cream while writing this post.

Wait, this ain’t passive income since you are writing during your vacation !?!

Right, technically, I am working right now and if I work while on vacation, I am not earning passive income. However, what really is really happening right now is that before taking out my laptop and writing something, I had evaluated my options:

#1 Take a nap (too boring and I don’t like wasting my time with sleep even though my body requires a rest once in a while.)

#2 Read a book (I am currently (finally!) reading The 4 Hour Workweek and enjoying every single page. But right now, I just didn’t feel like thinking too much 😉 ).

#3 Play MarioKart (All right, I want to play right now but I would rather write a few articles before I turn on the TV 😉 )

#4 Write

This is obviously the option I have chosen. The fact is that each time I write an article, I’m having fun. I don’t consider this as work for my online company. When I coach my VA, deal with advertisers, search for keywords or interesting affiliate programs, this is called work. But when I write, I am just having fun. The fact is when I don’t write for 2 or 3 days, I have plenty of ideas that fill my head and I just need to write them down.

The nice thing about the online company is that all the other tasks that are really considered work can either be:

#1 postponed

#2 delegated to my VA

#3 ignored

Obviously, I cannot ignore most of my tasks for a long time but I can just put all my projects on the shelf and let my blogs run. Everytime I go on vacation, I am not completely available and my blogs get the same amount of traffic (or almost). Sometimes it feels like I could just take their income and do nothing and it would still work for a few months… maybe a year.

When I wake up in the morning and I secretly look at my blackberry to see how much I made yesterday, I realize how cool it is to have a sideline making money. I not only receive my day job pay check as usual, I am also getting my sideline pay check too!

While reading The 4 Hour Workweek, I have plenty of ideas to automate more of my routine and try to earn more money with less work. I hope it will happen in the upcoming year!

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August 24, 2010, 5:00 am

A Letter from My Wallet

by: The Financial Blogger    Category: Miscellaneous,Personal Finance

Dear Mike,

I’m writing this letter to you because we rarely have the occasion to talk. The fact that I am always stuck in your back pocket doesn’t help either. That is without mentioning the long day I spent alone on the kitchen table when you forget about me the other morning! Since I’m in a position to watch your back, I’d like to give you a few pointers:

#1 Clean me up!

As you may have noticed, I’m starting to fall apart. Since I feel that I am too young to retire, I would appreciate if you could open me during a rainy afternoon and look inside. Take a look and see why I’m having so much difficulty holding everything together, why my leather is starting to gather holes:

–         This old Starbucks card has been empty for the past 6 months. I know you told me that you would fill it up again but you keep using old spare change or your credit card to get points when you get a coffee. Getting rid of the Starbucks card doesn’t mean that you have to get rid of your coffee habit!

–         Speaking of which, you still have too many credit cards in your wallet. Why have more than 2? Your reward card is a great idea, having a second no fee card for emergency use is smart too. But carrying your (full) transfer balance credit card with you? What is the point? You even have an old Amex that has been cancelled by the creditor since you haven’t used it for years!

–         Association cards… do you really need to feel young again? Listen to me; you are not at school anymore. This time is over, you have a child seat in your RX-8… grow up and toss your old university card into the nearest trash can.

–         Finally, the last card in me is a gift card you bought to go to a local restaurant. I remember the day where you picked me up in a hurry because the kid at your door was desperately smiling at you so you would buy one of his cards. Let me be your best friend and listen to this advice: each time someone knocks at your door doesn’t mean that you have to buy what they have to sell!

#2 Update me!

You know, Mike, I can still be your friend for many good years. I can hold all our important stuff and still carry a few dollars even though they have become very old fashioned these days. But you also need to update what I have to carry:

–         Gift cards (that are valid!) should be part of me. Each time you go to a store you forget to bring them because you leave all your gift cards in a drawer, what sort of idea is this?

–         A car assistance card would definitely not be taking space in my arms for nothing (as compared to your old Starbuck card!). I know you like your car and you are really proud of it, but it is still a 2004 and has nearly 100,000 km on it. Maybe you should think about the day you will be stuck on the highway…

–         You know I love our family. I hold a picture of them daily and I’m proud of them. But it would be nice if I had an updated picture of Amy before she enters high school…

So Mike, I think that if you can spend only 10 minutes this weekend with me, we would become even better friends than we already are.

And oh, by the way, it’s okay to forget me on the counter the days you plan to have hot dogs with chilli sauce… it’s not very funny to be in your back pocket on those days…

Take care,

Your old, but still yours,


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