The second lever#
Levels 1 to 5 were about keeping and investing money. That’s defence. You need it, and it has a limit.
You can cancel subscriptions, cook at home and move to a cheaper flat. At some point there’s nothing left to cut, and life gets small. Nobody ever got free by splitting a teabag.
Income works the other way. No rule says your next euro must be harder to earn than your last one. And if somebody tells you that wanting to earn more is greedy, check whether he has plans for your money. He usually does.
Guess first
That’s €540 more, from two moves of 10%. The raise brings €300 of it, the cut €240.
The catch hides in two words: “spending unchanged”. A raise that turns into a bigger car is not a lever, it’s a bigger car. Decide where the money goes before it arrives. Half to the savings plan, half to life. That’s the rule from level 4.
Lever 1: salary negotiation#
If you’re employed, this is the best hourly rate you’ll ever earn. A few hours of preparation can change your income for years.
Put a number on it: what a raise is worth over the years, and what cutting brings next to it.
How I’d prepare:
- Collect evidence. Write down results from the last twelve months: revenue won, costs saved, projects delivered, problems solved. Numbers, not adjectives.
- Know the market. Look at public salary data and job adverts for your role, region and experience.
- Name a number. A concrete figure with reasons beats “I would like more”.
- Pick the moment. After a visible success, and before budgets are fixed.
- Have an alternative. You don’t have to threaten anyone. Knowing that you could leave changes how you talk.
If the answer is no, ask what exactly has to happen for a yes, and by when. Get it in writing. “We’ll see next year” is not an answer, it’s a lullaby.
Changing employer is the other route. Whether it pays more than staying depends on your field, so check the market instead of assuming.
Lever 2: skills#
Your income follows the size of the problems you can solve. Bigger problems, bigger pay.
Skills that pay in almost any job:
- Selling and negotiating: including selling your own ideas internally.
- Writing clearly: the person who can explain the thing often ends up leading it.
- Working with data and automation: including AI tools. I build with AI every day, and I think letting software do the repetitive part of your job is turning into a basic skill. Better you automate that part than somebody else does.
- Leading people and projects.
Pick one skill per year. Spend money on it if you have to. A course that raises your income is an investment with a better expected return than most funds.
Lever 3: a side business#
A side business lets you test entrepreneurship while your salary plays safety net.
The simplest version: sell a skill you already have. Consulting, development, design, teaching, repairs. It needs little capital, and the first paying customer tells you more than any business plan.
Rules I’d follow:
- Check your employment contract and tell your employer if required.
- Register properly and keep business money in a separate account from day one. What “properly” means is national: which office, which form, from which turnover VAT applies, what happens to your social insurance. Four questions, one afternoon on your tax authority’s website.
- Set aside a share of every invoice for tax before you spend anything. The tax office has a long memory and no sense of humour.
- Start with one offer and one type of customer.
The principles travel, the forms don’t. I wrote up the German version of the checklist in your first side business. Use it as a template for the questions, not for the answers.
Lever 4: your own company#
A company is the lever with the widest range of outcomes. You can build something that earns more than any salary. You can also lose time and money. Both happen.
Planned economies abolished the entrepreneur and then spent decades wondering why the shelves were empty. I’d rather be the person who fills them.
I founded VEONIO in 2017, so I’m biased. I still wouldn’t tell anyone to quit a job on a whim. A side business with paying customers is a much better launch pad than a resignation letter and a logo.
If you want to compare the levers, read why income is the bigger lever and the build hub.
When income grows, structure matters#
On a normal salary, somebody else decides most of your tax for you. Once you invoice clients, hold a company or think about moving countries, that changes.
Legal form, salary versus dividends, where the company sits, where you’re tax resident: these decisions can be worth more than any investment choice. They’re also easy to get wrong, and some mistakes are expensive to undo.
The EU is one market with a different tax system in every member state. You’re allowed to compare them.
This is where the course hands over. Deep dives on founder tax and structures live at Nerdy.Money.
Get qualified advice before you set up or move a company. This lesson is education, not investment, tax or legal advice.
Next level: the final one – your number, your withdrawal plan, and everything on one page.
Mission
Quiz · 3 questions
level 6
Done reading?Tick the mission, answer the quiz, then claim your XP. Or just claim it, I’m not your teacher.
Education, not advice. I don’t know your situation, and past returns promise nothing. Check my numbers, then make your own call. You’re a grown-up.