One neat trick to get a $2,392 per year raise without asking your boss

If you're like me, the thought of asking your boss for a raise causes you to tense up, pop out a few extra gray whiskers, and run silently into the bathroom to throw up. I hate confrontation, and when you walk into the boss's office to ask for a raise, you're straight up telling them that they're undervaluing you and you know better than they do about how much you should be compensated. That's confrontation. So when financial bloggers tell me to get out there and negotiate for more pay as one strategy to bring in more money, I quickly start looking over the other strategies.

With that said, I'm going to let you in on some good news: just this past week I managed to get a $2,392 per year raise. That's an extra 3% boost to my bottom line that didn't exist last month. More importantly, that's after taxes, which means I will get a reliable $199.33 extra in my monthly win column for a very, very long time. The best part of the whole deal is that I never once spoke to, emailed, or even thought about my boss. I'm not even in the same country as him right now. But when I check my bank balance, there it is: $199.33 more than last month. The one neat trick I used to get that raise is pretty much guaranteed to work for you, too. In fact, you might be able to score a significantly larger raise than I did, and you'll never have to ask anyone for anything.

How to instantly get a fat raise without negotiation

This week, I paid off every single credit card I own. I am now completely credit card debt free, and it's saving me $199.33 per month.

SCREECH! Yeah, you knew there was some catch to the "one neat trick." When does a headline like that ever really lead to what you were expecting? But bear with me, because this little lesson is waymore important than any sort of salary negotiation kung-fu you could ever learn. It's more important than learning the side hustle. It's more important than understanding the stock market, or 401(k)s, or how to make your own toothpaste with home-grown beansprouts, or whatever else the hell those extreme frugality folks are talking about. If you're in your 20s, this will be the most important lesson about money you need, because it will set you up to retire in your 30s. For reals, cross my heart, and swear on The Beard.

If you have debt, it is sucking more money out of your wallet than you could ever imagine, and no amount of scrimping on toilet paper and peanut butter will make up for the hole it leaves every month. No amount of pleading with your employer will get you whole.

First, let's get one thing out of the way: snapshot of that beautiful number $0.00. Looks real good next to the words "Credit Cards."

That little drop down box has information for three different credit cards, and they all are sitting at ZERO. That feels good, but it will feel a hell of a lot better next month, because now there will be significantly more money that can be put to productive work towards or million dollar goal.

Back in December, we had an over $13,000 total balance across all three cards. That debt load was costing us $199.33 in interest payments each month, and the only reason it wasn't way higher is because half of the balance was on a relatively low interest rate card (~9%). Now this post is not about how we managed to pay off that credit card debt. It's about how ridiculous it was of us to let that interest monster keep taking its bite every damn month.

I spent a lot of time this year working my ass off at work, doing stuff nobody else wanted to do because I fully expected to get a fat raise out of the deal. Many of you have been in the same boat, and many of you have had the same result. Nothing. Two things happened that have changed my view of work, my compensation, and what should be my focus.

You don't need a big income to get rich

In the past few months, I've sat down and poured over my families finances. I pulled all of our financial accounts together in and started looking at our spending, our saving, our net worth, and silly little things like how much interest is costing us per year. Some things really surprised me. I didn't know our net worth was actually that high. Cool. I also had no clue we spent several thousand dollars more than we earned in December alone!

Once our financial picture was clear, I did the math. Click that link for the details. The short version is that we can retire in 10 friggin' years with a net worth sailing past $1 million on only my salary without ever worrying about a raise. Holy beard oil! That can't be right. But it is. I literally have degrees in math. It's correct. We can do this without any deprivation, basically living the same fancy-asslife we live right now.

I spent insane energy fighting for more nickels when the nickels I earn right now could have me set for life by 45 years old. If I had only got hit in the head like this in my 20s.

You really don't need a giant income to get rich, you don't need a giant income to live rich, and you don't need a giant income to feel rich. That realization is the first thing that happened to get me hyped for this year.

Your circle of control

The second thing was realizing that I really do control a whole lot about my future, so long as I actually focus on those things I can control. Mr. Money Mustache talks about Steve Covey's book "The Seven Habits of Highly Successful People," and specifically the concept of your personal circle of control. MMM talks about this more eloquently than I can, so click over to read it from him. In this context, though, there are things more directly under your control than your salary.

Yes, you have some minor amount of control over your salary based on your experience, work ethic, productivity, blah, blah, blah. However, what fundamentally controls your salary is the market rate for the work you do. You can complain about it, but it would be just as useful to complain about a 5% dip in the stock market, or the increasing cost of health insurance. Instead of focusing your energy on something not really in your control, spend that energy on the stuff you can control.

For example, you're big giant, asinine debt that you stupidly ran up without much thought because you're a big, dumb idiot. (I'm looking in a metaphorical mirror right now.)

Your spending is also directly in your control, which means your savings rate is also completely within your control. The beauty of that is that your savings rate is the one and only variable that determines how long it will take for you to retire.

Let that sink in for a moment. When you retire is completely within your control. You have the power to make that 30 years from now, or 5 years from now, and your current income isn't even a controlling variable in the equation. That, my friend, is a powerful realization. Don't believe me? Check the math.

Paying off debt is giving yourself a raise

That one neat trick I talk about above is the easiest way to give yourself a raise and increase your savings rate. Let me lay out for you the Beard Family debt before paying off those credit cards. In the table, I also provide the monthly interest payment on all of that debt.

Yikes! We were spending $11,507.04 on interest that provides us absolutely not a damn thing. You don't get to eat interest. You can't put your feet up on interest after a long day at work. You can't even brag about it to your friends. "Hey John, this month I gave $958.92 to a bunch of banks. Suck it!"

Imagine having a $11,507.04 raise. For me, that's 17% of my base salary. Blow that away and I've gotten the biggest single raise ever in my life. I'd be able to increase my savings rate to 67%, which would cut the time it would take us to retire by HALF. We could be financially independent IN FIVE YEARS!

We didn't really mean to get this much debt. When you're young, you don't think about savings rates because you're not even thinking about retiring. That's something old people do. But if you did pay attention to these things, then you would learn that you can be financially independent by your early muther-f@#king 30s.

If you are right now in your 20s reading this, then pay very close attention to what I'm about to tell you:

Stop spending all of your money!

And really, really, really stop spending money you don't have, which is the cause of debt. It piles up. You don't even see it happening. But then you're suddenly in your mid thirties blowing $11.5k on some banker's Porsche.

Every penny you spend is under your control, and every debt you incur is debt you asked for. So just don't do it.

This is a silly little site about beards and money. It's entertainment. I rant about beard oil and make weird posts about mathematical models of awesomeness. But this topic ain't silly. If enough people could learn these lessons, we could change the world. So I sucked you in with the hope of learning how to effortlessly get a raise. Hopefully you stuck around for the real lesson. You get rich by loving what you have, spending less than you earn, and making bankers poor by buying what you can afford.

Oh, and beards are awesome. The end.