Dangers of a Market Wage

Money can buy a lot more than happiness. Just know the bargain you're making.

Money can buy a lot of things. The one that’s never talked about - sadness. Money buys that too.

Workers are lured to tech for the high salaries and cushy lifestyle. The proverbial gift and curse. The double edge sword.

The market is salary is a compensation package is one that exceedingly difficult to beat. Base salary, cash bonus, equity grants, stock options - you name it. After getting the top of market wage the future is lateral moves unless advancing up the corporate ladder.

Securing a top-of-market job offer is life changing. Software engineering is a skill where you can make north of $100,000 USD within a few years of completing an undergraduate degree.

Once the money is coming in it’s tricky to give up. High paychecks are similar to addictive drugs. Of course you’re not addicted! Of course you can quit when you want! Addiction rears its ugly head. Will the smoker light up one with his friends or prove they really can “quit when they want”.

The day of reckoning comes for all of us. Some sooner, and some later.

Struggle is inevitable. It’s the story where you develop passions besides coding 24/7 or the jump to management to capture that next 20% raise only to discover that you hate being a manager. The skillset required to continue wage growth is different than the software engineering skills you’ve been honing for a decade.

Economics classes taught us The Market is (almost) always right. Something about supply and demand. Sure, but also not really. It’s hard to be a dedicated company employee AND at the top of curve for the skills required to routinely secure top wages. There is demand for high skilled workers. But, the once desirable Rails and Postgres acumen loses value over time while demand for AI engineers captures the lion’s share of the attention.

Changing jobs for market salaries becomes exceedingly difficult over time. Candidates quickly find that their skills - while useful in their current role - are less valuable on the open market after a few years of aging.

For a thought experiment - how would life change if you could live comfortably with a salary 10-20% below a market wage? Would there be less stress knowing there’s access to more jobs? Going for a top market salary eliminates 90% (or more) of job openings because most jobs simply don’t pay that much. Finding a software engineering role that pays $160k base salary is fairly challenging. (For the record, these are guessestimates and should not be explicitly relied upon.)

You’ve heard the advice “avoid lifestyle creep!”. It’s one of those things we generally know to be true, yet few actually demonstrate. There’s talking the talk, and then there’s walking the walk. Car payments, big homes, fancy education, international vacations, expensive gadgets. Life gets comfy with a big bank account refilled every 2 weeks.

There will be a day where you’ll question if it’s worth it. The stress of the job. The problems dealing with the new team. The switch to yet another project management process. Yet another legacy project. Missed deadlines. Demanding bosses.

Appreciate what you have, today.

Save money. Prioritize health. Preserve sanity. Invest in keeping skills sharp.

Build a side hustle. Create additional income streams.

This might not make sense today.

But this I promise you - some day it will.

I want you to get every dollar you can possibly get. That’s why we’re out here busting our behind fighting compiler errors, studying algorithms and bickering on Hacker News :D

Just remember that these dollars come with a tax that’s sometimes tough to pay.