Reality is really in the middle of that, and it depends on multiple factors outside of that salary number. I'll give you a couple for examples:
In high school, I wanted to be a professional equestrian, Olympics, all that. I was on the Young Riders team and training under Olympians - so I had the talent, but that includes also training other people and their horses. And you don't just start out at the top. Most of the time, you work yourself to the bone for years with sub par horses until you get your break. It's extremely dangerous, and an injury can destroy your career. Staring down that road, I took the advice I was given and stayed an amateur so I could enjoy it as a hobby. That meant finding a job that would provide the salary I would need to be able to enjoy horses as a hobby.
Then recently I had a recruiter from another company reach out about a role that would be about 8% higher than what I have currently. I turned it down because I really, really like who I work for, my peers, Verizon's culture, and the flexibility I have. When I looked at the overall profitability and stability of Verizon versus this other company, it really was a clear choice. I'll stay right where I am.
Conversely when I made the switch from my previous company to Verizon, I sacrificed a lot of work/life balance for the salary - and it was tough at first. I went from an 11-mile commute to a 65 mile commute. I went from a normal 8-5pm shift to a 3-11pm shift, which put me opposite my husband. I had less vacation, and less seniority. But I tripled my salary overnight. My husband was about to retire from the Army at the time, and this salary meant that we wouldn't have to make lifestyle changes while he made his career change.
So tl;dr - weigh out all the pros and cons of the salary, the company, the people you work with, the flexibility and what that salary allows you to provide for your family. It's not a cut and dry answer, but you also can make changes if you decide you're unhappy.
1. Company's Base Pay – Base pay is taxed lower than a bonus and therefore I think obtaining higher base pay than bonus is better
2. Firm that supports work life balance – Especially since many employees are working from home it is sometimes hard to know when to close your computer to enjoy life with friends and family
3. Supportive Teams – Especially since a lot of employees are working virtually it is good to have supportive team who is understanding and willing to assist and support each other when needed
4. Company's Vacation Policy – Having enough time to take off from a job to refresh and spent time with family and friends is very important
5. Company's Pathway to Promotion – Always try to understand what the pathway to promotion to different level of your careers is
6. Company's Benefits Package – This includes Additional Financial incentives (401k etc.), medical benefits, family benefits (maternity and paternity leave etc.), educational benefits (company pays for certifications etc.)
7. Ensure this is a career you are interested in because it is sometimes hard to change to different careers after years in a particular career
I hope this helps and if you have any questions please reach out.
Andrew Vitone, CPA
Accounting and Finance salaries can vary significantly based on the position you are going into. I would say generally there is a trade off between hours worked and the level of pay, but another factor to consider is the difficulty of the job. Certain jobs starting out tend to be relatively simple entry level positions but the compensation matches the lower skill level required.
When deciding on positions or what field to go into I would generally recommend looking at these three categories to evaluate what it is you want.
1. Compensation (High salary, signing bonus, or equity compensation) - Generally when comparing positions my rule of thumb is if it is a greater than 10% difference in salary you should consider switching if more compensation is what you are looking for. One other thing I will call out is if your goal is to build wealth versus having a higher income you should look at the value of any equity (stocks) provided as part of the compensation. Sometimes it is better to take stock and have a slightly lower salary versus getting all of it in the form of a paycheck.
2. Work life Balance - If your goal is to make as much as possible and not have time for anything than your priority is likely #1. Generally though I think most people enjoy being able to spend their money on things or activities and so you need to evaluate with any job how many hours in a week will you be working. Ask people in the position or company if you will have the boundary of shutting down your laptop at the end of the day or if you will be on call 24/7. Sometimes making a bunch of money is not worth it if you can't enjoy it.
3. Difficultly / Culture - The last thing I consider is how independent is the work, will you be getting a lot of guidance or is it an independent learning environment. Some of this comes with experience on learning what you like, but generally the less hand holding there is in a job the higher the compensation will be. That often leads to more stress and responsibility which you should consider if you can handle or want that for each inflection point in your career. In addition to difficulty you should assess if the people you meet from the company are individuals who you could spend long hours with or go on trips for work. Depending on the job you could spend a lot of time collaborating and you want to at least have an idea of if you will enjoy the social aspect that comes with so many work environments.
1. Does the job suit your interests and increases your interest as days pass by at work?
2. Does the job increase your satisfaction level or not?
3. Is the workplace congenial to work?
4. Are the colleagues/management supportive and guiding?
5. Does your job offers space to learning?
If you get a positive response to many or all of these questions, definitely you can choose the job and continue to work even if the salary package is little less than your expectation.