To think there’s no point earning more money

[Dimblebimble]

For context, I’m a 29 year old University lecturer with 4 years experience post-PhD. I work at a well regarded research intensive University (but not Oxford or Cambridge). Married but with no kids, hoping to start a family soon.

I earn £43,000. To earn more I will need to be promoted to Senior Lecturer, then Reader, then Professor, which will take me at least a decade (probably much longer as I’m planning on having children) and a huge amount of work (think evenings and weekends for the foreseeable future, progression is based on conducting and publishing high quality research). Speaking to a colleague who was recently promoted to professor, I found out that their starting salary for this role is £60,000. I can’t help but feel that this isn’t worth the tremendous effort it takes - once tax, NI, pension and student loan are deducted their monthly take home salary won’t be much different from mine. Not enough to make a huge difference to quality of life, surely?

AIBU to think screw it, it’s not worth it? I’ve always been very career oriented, hoping that this will provide a better life for me and my (future) family, but is it just me or is it completely not worth it? AIBU to just coast rather than pursue career progression? It seems a waste of all my hard work and study, but there’s very little incentive to progress.

(Before anyone says anything, I know none of these salaries are bad salaries, and that I’m very lucky, I’m more confused by how little difference there is between the salaries despite the huge difference in experience required)

The point, if any, at which it stops being worth making more effort for the returns you'll get is a personal call. Once basic needs are met, which yours must be on that wage, people vary wildly in how much value they assign to more money as against more free time. You're not BU to decide that where you are is optimum, and you also wouldn't BU to go for it because you want the extra cash and/or prestige.

Disclaimer- I'm not in academia. My answer is on the basis of the general money v time question, not any experience in your field.

Well I guess it depends. The difference in net pay between £43k and £60k (only accounting for tax and NI at 42%) is £9,860 per annum or £820 a month. Not sure how much your pension contributions are but you’ll tax relief on them, so won’t cost you as much as what you’ll see going into your pension. Plus, means you get a bigger pension pot when you retire. Student loan- well, it’s been a while and I’m not sure how they’re calculated now but I had similar pay rises and yes my loan repayments went up but I always let it was worth it as I always got more net pay. I doubt you’d be left with less than £450 extra net pay a month.

But that’s just monetary. If you feel the extra isn’t worth it- then don’t! If you can afford what you need and afford some luxuries that make life worth it then don’t worry about it. Do consider impact and expense of children though, I’m personally glad I waited until I was on £70k+ (DH slightly more) as I appreciate being able to afford some things for me as well as pay for childcare and all that jazz too. But it’s all individual.

It isn't just about the money though is it. Would you enjoy the higher role more?

If you do have dc you'd also want to factor in the effect of means testing of child benefit on the real differential between the two salary levels . Though that depends on your dspouse's future salary as well, so may or may not be relevant! Though after dc have grown up that will no longer be an issue.

Plus if your dc go to university student loans are to some extent means tested, which again affects the real differential for the dparents, though obviously the situation may have changed by that time so perhaps not easy to base financial calcs on that!

Off topic, congrats because you must have done amazingly well to get this far! Isn't it quite rare for lecturers to earn so much in their 20s?

I would say go for it now before you have children. Then when they come along, you may want to work part time so the extra income will be useful. Also, think about your pension. As someone who is a year off retirement, my pension is constantly on my mind!
Finally, think about if you want to buy a bigger house when you've got a family. Having a bigger salary invpcreases the size of the mortgage you will be able to obtain.

Oh yes- and I suppose it depends on if you’ll ever want to be more senior/do you think you’ll get frustrated? I felt like that - I’d look at people more senior and think “I’m doing the same as them why shouldn’t I get paid for it”. I’m more or less coasting now (1 DD and 1 on the way) but I got to the level I wanted to pre children. Dunno how I would manage if I still wanted to climb the ranks with children.

Oh yes, good points about mortgage. (Pension as well, though personally I wouldn't sacrifice too much in your 20s and 30s for the sake of pension - an unpopular view on mn and rl, I know!)

Would promotion also put you in a stronger position if you wanted to move abroad eg to US universities - or is that not something you're likely to be interested in?

Well if you want career progression resulting in a mega-buck salary then academia isn't a good choice. Unless you go into the management side and become a Vice Chancellor. You can get £200,000+ doing sod all at a low-ranking university.

Seriously, I understand weighing up job effort/financial reward but if you are really motivated by money then you'll have to look elsewhere for a big salary. But if you love academia then of course it's ok to stay at a financially 'satisfactory' level rather than flog yourself to climb upwards.

Your pension contribution may increase but this will increase your pension pot so you win there albeit later in life
You will pay your student loan off quicker
You will still have more net pay
If you don't do it before children you definitely won't do it after

From a purely monetary point of view: nope it’s not worth it.

DH has recently had pay rises between the exact amounts you are talking about. He earnt over £1000 more last month and we saw less than £500. So we lost over half of his extra money to increased tax and national insurance. We can’t really complain about the increased pension contribution but that wasn’t that big, it’s the increased tax and national insurance that’s depressing.

Gross salary increases will always result in higher net pay (if you class increased pension contributions as part of net pay)

Whether the trade off with loss of non working time is worth it is a judgement call.

I am a finance director in a family owned (not my family) business. I could earn more if I travelled to a bigger city, and gave up my free time to email etc, but have chosen not to. Much the same type of choice.

Remember - no one gives out medals in life :)

NB PAYE behaves a bit wierdly over 100k, where tax can be more than the increase - but at that level you would expect salary negotiations to take account of that.

Exactly what Plexie said.
I don't think people who are in academia are in it for the money, generally.

Oh and we lost our child benefit too. Hardly a pay rise really in the end...

If your salary is enough for you to lead a comfortable life, why bother taking on all the extra work. Life is for living! No?

I have to say I'm a little confused as to what sort of world people are living in who see an extra (roughly) 500 quid in their account each month and declare it's 'nothing' or 'not worth it'.

I'm in a similar position. I'm a Teacher on £42k. I could push myself on to a Headship for which I might get 55-65k depending on the school.

The extra 15k would be mostly in 40% tax bracket so I'd see maybe £400pcm more. That is not much of an incentive to take on the epic increase in work, responsibility and stress.

Trialsmum - not at all saying this is your attitude, but it did strike me someone at the lower end of the earnings scale making a statement analogous to yours about losing child benefit (e.g. started working over 16 hours and lost tax credits/whatever other benefit and therefore no better off) would be lectured about expecting the taxpayer to keep them. The pay rise takes you into a bracket where you're deemed not to need child benefit any more. Isn't that actually a good thing?

@AnElderlyLadyofMediumHeight

It depends really if you are fortunate not to spend all you have.

If you are already saving a few hundred each month, then how would your life change with the extra 500.

ie you would be doing all the extra work in return for saving more.

Yes, that is great, but is it worth the grief.

That is the type of choice the OP is thinking about.

I'd have expected someone looking at those kinds of roles to get much more from their work than cash. If you won't then it's not for you.

It would be a gain of 800quid or so a month - seems reasonably significant ?
But no one goes into academia for money.
You have to actually enjoy the subject and process of doing research so it does feel so painful to read about it outside 9-5.

What field are you in? Maybe something in industry would mean earning more.

Its a personal decision.

I've been promoted in the past, and then resigned from the promotion because quality of family life went down overall.

Yes, extra money, ( not much) but not worth the lost time, nor the extra stress in life.

so on balance, I decided long ago that further promotion was not for me.

I've turned down two promotions this year, and am happy with my decisions, and with my pay packet, and with my job, and with my family life

As a PP said, children are wildly expensive. Not just food and clothes, but childcare costs, needing a bigger house, having double the holiday expenses, having to fund uni or help with house deposits. You would find every penny of that extra £500 a month would be a godsend!
Mind you, if your partner has a well paying job, you might be able to manage between you without you needing the extra. You’d need to sit down and thrash out the joint finances, versus costs of future kids.

I know how you feel i recently got a pay rise and so did my DH which meant we lost our Child Benefit which completely wiped out my payrise its disheartening at times.

It is so much more than the money.

Career achievements. Ambition. Power. Status. Enjoyment of the role and progression. Development as a professional.

Money is a side factor.