Have you ever taken a job without negotiating a higher salary or failed to ask for a raise when you knew you deserved one? Have you ever failed to raise your rates because you were worried what your clients would think, or underbid a job because you wanted your client to like you? If you answered yes to any of these questions, you may be an underearner. “Underearning” is the pattern of earning below your potential, of consistently not making enough money. It creates stress and resentment and it affects the quality of your life. And over your lifetime, it can cost you hundreds of thousands of dollars.
Many women identify with the struggle of not earning enough money, let alone achieving their earning potential. And while it is true that gender discrimination is alive and well, sometimes women themselves are the culprits, struggling to ask for what they hope they are worth.
When I first started my practice as a financial recovery counselor and money coach, I expected to encounter behaviors such as compulsive spending, debt overload, and financial conflicts in relationships. And while these are definitely big issues, I also saw that many women were undermining their financial security by consistently not earning enough money. These were not women being victimized by outside forces. Instead, they were victims of internal forces. I kept encountering situations where the beliefs of some women were getting in the way of their making more money.
Not making enough money dramatically affects women and the lives they can lead. It affects what they can and can’t do, now and in the future. It is imperative that women understand why they undersell themselves and gain the practical tools to earn more money. The good news is that I firmly believe it is possible to make more money—it is possible to earn at one’s potential!
The most common ways that women underearn is that they fail to ask for a raise or negotiate their initial salary. Self-employed women struggle to set their initial fees at a competitive rate and commonly don’t raise their rates often enough or high enough. Part of the dilemma is that many women are waiting to be “perfect” before they ask for more money. Patricia Smith, in her book Each of Us, How Every Woman Can Earn More Money In Corporate America (1998), discusses a fascinating study that documents how men and women react differently to a job posting and the decision to go for an interview. Women feel they need to have mastered one hundred percent of the skills and knowledge required before they will attempt a job interview. But what about men? Men will attempt an interview even if they only possess forty percent of the skills and knowledge listed in the job posting!
Even if women override their internal need for perfection and attempt the interview anyway, they will actually spend time in the interview telling their potential boss things like, “I know you wanted five years experience, but to be honest, I only have three.” Or “Just to be clear, I know you wanted advanced Excel skills, and my skills are really intermediate.” Men would never think this necessary, or even appropriate. So you might ask yourself: Are you waiting until you have more experience, the next credential, more clients, a new service to offer, a certain skill you need to master? In essence, are you waiting to be perfect? Because if you are waiting to be perfect before you ask for a higher salary or raise your rates, you will be waiting a long time indeed. Practice telling yourself this: “I’m good enough right now to make more money.” Stop the waiting.
The Good Girl Syndrome
Women are very relational. This is a wonderful thing. But we must ask ourselves, is our desire for relationships interfering with our ability to take care of ourselves financially? When you fall prey to the “Good Girl Syndrome,” you want everyone to like you and you don’t want to make anyone mad. Sound familiar? Many of us struggle with this, both inside and outside the workplace. But if you are overly concerned with your boss’s feelings or the ramifications of asking for a raise, you will hold yourself back. The fear of “rocking the boat” keeps many women from asking for their true worth. Here is another great question to ask yourself: “Am I willing to inconvenience the people around me?” Asking for a raise or raising your fees might not be convenient for everyone in your business life. Are you willing to inconvenience someone to make more money? Are you willing to put yourself first? Trying to be a “good girl” has kept many women from making the kind of money they deserve to make.
Some women believe, often subconsciously, that good people don’t make a lot of money. And if they did ask for more money, they fear they would be thought of as greedy. These beliefs stem from the notion that it’s better to be “good and poor” than “rich and evil.” While it sounds extreme, many women have a conflicted relationship with money and spend a lot of energy declaring that money is not the most important thing in their lives. While this is true, it’s time some of us elevated the status of money in our beliefs. How many of us have conflicted feelings about the wealthy? Many people believe that the wealthy are greedy, insensitive, and feel superior to other people. There are several problems with this belief; one being that it makes it highly unlikely you will ever have a lot of money yourself. Why would you allow yourself to be seen as greedy, insensitive, or superior?
Our subconscious beliefs have a tremendous impact on our ability to consistently stay focused on our earning power. A wonderful exercise for people who struggle with noble poverty is to begin looking for positive examples of wealth. What do you value? If you value early childhood education, for example, search out the wealthy who donate in this arena. Identifying positive role models around wealth can do wonders for changing how we feel about the possibility of wealth in our own lives.
Read Part II of Make More Money—Why Women Undersell Themselves and What to Do About It