4 Ways Taking a First Job With a Low Salary Can Set You Up for Financial Freedom

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When most people head into the workforce, they think they want to make as much money as possible. While this might be a good long-term goal, sometimes earning more from the start isn’t always ideal. 

Instead, you might find that starting with a job that pays a lower salary could put you on a path to even greater financial freedom later on in life. Here’s why.

You’ll Learn to Stretch Every Dollar

By starting with a low-paying entry-level job, getting creative with spending is a must. You won’t be able to afford to eat out all the time or go shopping every week. It will be crucial to understand how to budget money to afford bills and still be able to put money away toward savings. 

Then as you start to progress in your career and begin making more money, you’ll already have the foundation for budgeting down. As long as you keep lifestyle inflation in check, you’ll be in a better position to make smart financial choices that can help lead to financial stability. 

You’ll Be in a Position to Impress

Someone starting their career with a job that pays a higher-than-average salary is going to have higher expectations. They’re going to feel like they need to deliver results right away, which can be overwhelming for someone just getting started.

However, if you’re starting with a lower-paying job, you’ll still need to deliver results, but the expectations aren’t going to be quite as high. Instead, you can work hard and be in a better position to impress your managers. Hard work will allow you to develop a positive reputation, putting yourself in a better position for career growth.

It’s Easier to Find What You Like and Don’t Like

When you’re first starting out there are a lot of unknowns. The biggest is whether or not the career path you’re starting on will be enjoyable. By starting with a higher salary, being happy at work could become a lower priority. It quickly becomes a paycheck and not much else. That’s probably not how you’ll want to spend the next 40 or 50 years of your life. 

Unfortunately, starting at a higher salary would make it difficult to switch career paths and make less money. This could potentially mean fewer options when searching for your ideal career.

You Could Get Passed Over For Jobs

Imagine starting a job out of college that paid you $50,000 per year. Then, a couple of years later, there is a job posting at the company of your dreams. Because of pay transparency laws, you know the position is going to pay anywhere from $50,000 to $70,000.

However, because you started your career making $50,000, you apply with salary expectations of $65,000. Unfortunately, someone else is applying for the same job but only needs $50,000 because they started their career making $40,000. 

You both have the same experience and qualifications, but they’re more likely to get the role because of the lower financial commitment. 

While you never know what things would have been like working for that company, decisions along the way can have big impacts on your career paths. Maybe that would have been a stepping stone job, or maybe it was the path to where your true happiness lies.

The Bottom Line

While most people want to start their careers earning as much money as possible, there are advantages to earning a lower salary at the start. Not only will you be forced to learn better money management skills, but your career trajectory could benefit as well.

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