TIB 15: Is the juice worth the squeeze?

TL;DR: Define how much your hourly rate is and aim to bill your time out at that hourly rate. Knowing how much you are worth and asking for it is one of the keys to a happy and fulfilling work experience. Settling for less can turn even the best situation into a miserable one.

Defining how much an hour of your time is worth can make a miserable situation a much happier one. Don’t believe me? Well let me tell you a story about one of my best friends who used to loathe his job. After he defined his worth, asked for it (and got it), he couldn’t be happier.

I asked him recently what changed for him, and he said that he realized that he didn’t loathe the job itself. He actually enjoyed many aspects of it.

He was good at what he did, he had the support of his colleagues, and had made genuine friendships along the way.

What he resented was the feeling of being underappreciated.

He knew the value that he brought to the table, he had an idea of what other people were being compensated, and relative to the value that he believed he brought to the table, he felt that his company wasn’t valuing him in the same way that he valued himself.

Things came to a head a year ago when he finally told his boss that he was leaving unless his compensation was brought to a level that he was comfortable with.

He had a number in his head, but he didn’t put the number on the table first. He let the company come up with a package and come to him. When they presented the package to him it matched the number he had in his head.

He says that ever since that moment, everything clarified.

This amount of money was worth any and all aggravation that came with the job. Suddenly he didn’t feel underappreciated.

He felt appreciated, and most importantly, his incentives were aligned with those of his employer.

They win; he wins. They lose; he loses.

Finally the juice was worth the squeeze. He just needed to ask for more juice.

The importance of defining your internal hourly rate

Let’s examine what we can learn from this story. I remember when I first learned how much my law firm was billing my time out to the client I was floored. The idea that an hour of my time was worth $500+ dollars an hour made my head spin.

Now, let’s be very clear. I didn’t get paid $500 an hour. The firm made that amount of money for every hour that I worked (no matter how little I knew only a few months out of law school).

This introduced me to the very important idea that we all have an “internal hourly rate” that we should bill our time out at. We all have value that we bring to the table, and whether we are working for ourselves or working for someone else, we should be getting paid our internal hourly rate.

Defining your internal hourly rate can make you happier

The first reason that it is important to define our internal hourly rate is that it can have a huge impact on our happiness. Getting anything less than our internal hourly rate will cause resentment and misery, no matter how objectively good a situation is.

Just look at my friend.

The minute he got paid his internal hourly rate, he was able to make peace with all of the things that had previously bothered him about his job. Quantifying what his time was worth was the difference between being miserable and being happy at the same job.

 Defining your internal hourly rate gives us power

The second reason its important to define our internal hourly rate is that it forces us to quantify our own worth, and it takes power away from anyone else (an employer) to define our worth for us.

Let’s get something out of the way now.

NOBODY is going to value you more than you value yourself.

How can you expect to paid something if you don’t even think you are worth that much? This is not to say that all of us need to be paid millions of dollars a year (though that would be nice), but it gives us all something to work towards.

Set an aspirational hourly rate, and you will suddenly start to carry yourself in a different way.

You will start to work a little harder.

You will learn a little more.

We are all our greatest critics, so chances are you will create a virtuous feedback loop where believing you are worth your aspirational hourly rate will actually lead to you being worth your aspirational hourly rate.

One day you just might hit your aspirational hourly rate, and it will be because at some point you started believing that you were worth that much.

 Defining your internal hourly rate keeps you from settling

The third reason its important to define your internal hourly rate is that it keeps you from settling for a job, career or business opportunity that provides you with anything less than your internal hourly rate.

As we have said before, time is our most valuable commodity. The best way to not waste time is to define what our time is worth. 

Final Thoughts

I said it before, and I will say it again. NOBODY is going to value you more than you value yourself. Knowing your self-worth and asking for it isn’t arrogance; it is confidence. It is the bare minimum confidence we all need to succeed in anything that we do.

To settle for anything less than you are worth is disrespectful to yourself and all the work that you put into being the best version of yourself each day. I’m not saying you have to march into your boss’s office tomorrow and demand a raise.

Don’t quit right away because you aren’t getting paid your aspirational hourly rate.

Set an aspirational hourly rate and work towards it. Keep that number in the back of your head when you negotiate for a raise, or when you consider career alternatives.

Make sure the juice is worth the squeeze. If it isn’t? Ask for more juice!

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