As employees, you are not just contributing hours into months of hard work, time and energy. Those are unquantifiable measures.
But delve deeper and you will see that you can actually measure the cardinal amount you are expending financially too.
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Yes you earn a regular income but you spend too. It is in fact these very expenses that are irregular and sometimes difficult to control.
Travel, phone calls and bills, purchasing meals, no matter how seldom you eat out, are all directly or indirectly costs branching out of duty calls.
In the ongoing lockdown, your expenses would have taken a dip. This can help you figure out what your job costs you.
Yes, what gets you your very bread is also what makes you spend to hold it. This can give you the much-needed motivation to ask for a pay raise.
Or when you switch to a higher-paying job, you can identify the hidden costs that could derail your future money goals. Look at these parameters to analyse.
What you spend on metro, bus or cab rides is easy to calculate. Matters are more complext if you own a car. Calculate the total cost of ownership.
Did you have to buy a costlier vehicle to match your or maybe even the company’s status? If you pay an EMI, add fuel costs, car wash, insurance, taxes, maintenance, repairs and the driver’s salary, if any, to monthly EMIs. This, is the real cost of commute.
Consider opportunities closer to home, assess if moving closer to work will help, explore work from home partially in a month, if you can, commute in lean traffic hours, look at metro/bus, carpool options.
If you work in a city or country away from home, it’s almost like you are running two households, at least in terms of expenses. Paying rent and every other household bill, acquiring furniture and appliances may eat into 30-50% of your pre-tax salary.
Not just that, you will still be commuting to work so travel expenses will get added. Then there is the inter-city/country travel, right from your place to the airport to your home.
If this is your situation, don’t be surprised when you’re strapped for cash at the end of the month. Reconsider the costs and benefits of working and staying in the same location.
Lifestyle changes form a big chunk of the hidden costs of working. Food is the largest expense as your choices change in professional and personal settings.
At work, you may often end-up ordering food and tea/coffee or head out for a meal with or without colleagues. Also consider the number of times you have ordered food at home or purchased a frozen or pre-cooked meal or snacks because you were too tired to cook.
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Take home-cooked meals to work, shop and pre-cook on weekends to reduce costs. A dire dependency on outside food is not healthy anyway and especially in this lockdown, knowing how to cook will save your money and health.
Work deadlines and duties are some of the biggest stressors. This means that you will spend more on de-stressing or entertainment and recreation like outings, social gatherings, shopping, travel etc.
Moreover, now you have the means to and are financially independent so it’s only natural that you’d want to indulge a little.
Coming to the fitness aspect, your health is impacted when you commute in a polluted city, work long hours and are managing all your professional and personal duties, that too on your own.
All this affects your lifespan, wellbeing and mental peace. Do not under-estimate healthy eating, regular exercise and meditation.
Family duties can shrink your budget. If you and your spouse are working parents, childcare is a major expense via play-school, domestic help, tuitions or post-school programs to keep the kid/s safe and busy.
Throughout school and college life, new forms of unforeseen expenses keep cropping up. If you are supporting aged parents, they may eventually require caregivers/nurses or a driver and car.
Similarly, pets may require care or meals in your absence. Thus, a lesser paying job that has remote working or flexitiming may offer surprising cost benefits.
Fashion is the last of the direct costs of a job. Looking presentable and being well-groomed is a work demand and an ethic, work clothes require separate space in your wardrobe.
Add the cost of formal shoes, accessories and all your latest and expensive gadgets. There is also drycleaning, stitching/re-fitting and costs of personal care, including salon visits.
For big professional events, you will sometimes have to go shopping and buy specific items, which are additional expenses.
How can we forget taxes? You must be paying taxes like a good citizen but are you optimizing them for yourself?
Rejig your salary structure with your employer to minimise tax outgo, keep track of changing tax slabs and surcharges and plan out your annual investments and expenses in advance.
Secondly, consider working in a contract role where you can reimburse some costs. Finally, consider job opportunities in low or zero-tax countries where the potential to save is substantial.
Your education and degree get you your first job but your subsequent jobs are linked to your experience and skills.
You need to keep re-inventing and upgrading yourself if you want to survive in an ever-changing job market. You may want to take up studying and acquiring skills that will help you climb the career ladder.
Thus, upskilling is a cost you bear. To defray it, negotiate training and upskilling with your current employer or when you are switching jobs.
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