Do you ever think of yourself as an underearner? What exactly do we mean by the word underearn? It took me a while to come up with a definition in one sentence that satisfied all the elements and aspects of underearning that I had learned and discovered in my life experience and research. But here it is: To underearn is repeatedly to gain less income than you need or than would be beneficial, and usually for no apparent reason, and despite your desire to do otherwise. Let’s look at that once more for emphasis: To underearn is repeatedly to gain less income than you need or than would be beneficial, and usually for no apparent reason, and despite your desire to do otherwise. That’s it in a nutshell. You can come back to this definition as often as you need to or want to. In this article, we’re going to focus on examining this concept of underearning.

Now we’re defining the word need here in its most basic sense. It’s an amount that’s enough for you to provide yourself with food, shelter, and clothing of a decent quality on a regular basis. That’s the amount of income you need. While owning a co-op on the park or buying a new car every year or having the money to pay for your daughter’s medical education and Stanford might be pleasurable, and even desirable, they’re not needs.

Now beneficial is more open to interpretation. For our purposes, it’s enough to meet those basic needs, with money left over for relaxation, vacations, and money left over beyond that for savings and investments so money starts to work for you rather than only the other way around. As a threshold definition, that’s what we mean by beneficial.

The three types of underearning

Now, there are three types of basic underearning: compulsive, problematic, and minor. Throw out all the psychological jargon you’ve heard about compulsion. Basically a compulsion is just an act that is repeated over and over. It’s motivated by an internal reason or set of reasons, usually subconscious. Some compulsions are harmless, such as arranging pens on a desk or cans on a shelf in a certain order. Generally we think of them as no more than habits or personal preference if we think of them at all.

But some aren’t, like compulsive eating or compulsive underearning. Compulsive underearning is repeatedly to gain less income than you need or than would be beneficial despite the negative, emotional, and practical consequences that follow. And it’s to do that in the face of your conscious efforts or desire to do otherwise. It is, in effect, to be powerless over the repeated act of bringing in less money than you need, or than would be beneficial. That’s not nearly as bad as it might sound at first, and as it certainly did to me when I realized that that might well, and probably did, apply to me.

Now next is problematic, or problem, underearning, and that’s pretty much what it sounds like. The difference between that and compulsive underearning is largely one of scale and intensity. A problem underearner, for example, might underearn only periodically, and generally doesn’t experience financial trouble and emotional pain as severely as the compulsive underearner.

Next is minor underearning. This is underearning that’s almost irrelevant. It’s something like having a little cold. Something you hardly notice that doesn’t bother you much. But the very fact that you’ve purchased this program means your underearning probably isn’t minor. You have noticed the problem, and you are bothered by it. A minor underearner usually brings in enough to meet her needs, at least most of the time. What distinguishes her from someone who simply has a low or a modest income is a combination of two elements. First, the potential to bring in more, and, second, that to do so would be significantly beneficial. It would mean, for example, that she’d be able to buy a house or have an investment portfolio or even just be able to take more appealing vacations.

 

The two aspects to underearning

There are two aspects to underearning. The first is active underearning. Active underearning involves doing something that results in underearning. Any action, from quitting a job to setting low fees or turning down work. The possibilities are vast. For example, seeking work for which you’re not qualified. Making unreasonable demands on an employer or client. Spending time on projects or activities that will make little or no money. Incurring heavy expenses. Botching a job. Telling prospective clients or employers that you don’t know how to do what they want to hire you for. Behaving obnoxiously or offensively in the office or with clients. Accepting work you know will pay you less than you need. Making promises you can’t fulfill. Exhausting yourself during non-working hours. Investing more time on a job than you’re being paid to invest.

Here’s a classic example from my own life of active underearning. I wrote most of my books under pseudonyms. Whenever one of those pseudonyms became famous and built a loyal readership, I killed that name and began writing under a new one. Now I had conscious reasons for this, an elitist Flaubertian attitude about the difference between art and commerce, the fact that readers want a writer to produce the same kind of book over and over again—that is, if he’s a historical novelist, for example, they don’t want to see him writing mysteries—the fact that a publishing house wants an exclusive on a writer and doesn’t want him writing for other houses, and other reasons.

There was some truth in all of these, but the real truth, though I didn’t know it then, was that changing names was almost a perfect function of my compulsion to underearn. It is difficult, even in the best of circumstances, to establish a reputation and make a living as a writer in the United States. I put myself through the additional trial of having to do it three separate times, under three different names.

Carol is another example of underearning. Carol is a dental hygienist in Cleveland. She spent more money on her son than she could afford because she was trying to compensate for a divorce that took the boy’s father out of his life, and she had a difficult time nearly every month trying to meet the rent. She tended to quarrel with the dentist for whom she worked, and she’d worked in six different offices in the previous 10 years. She got fired from each of those, and she spent months without income, during which she went into debt before she could find another job. Now Carol wanted to leave the field and had been trying for two years to get a job as a paralegal, an area in which she had no experience. This is a fine example of active underearning.

Passive underearning involves not doing something, or failing to do something that, if you did, it would allow you to earn more money. Anything from not getting to work on time or failing to meet a deadline or neglecting to ask for help or advice. Passive underearning is more subtle and may be more difficult to discern at first, yet there probably are as many ways to do it as there are to actively underearn.

For example, ignoring or blinding yourself to an opportunity. Failing to request a raise. Not knowing what your expenses are. Not attempting something unless you’re positive it will work. Failing to fulfill responsibilities. Not making sales calls. Not increasing fees. Waiting for something to happen that will make things better. Not capitalizing on skills or abilities. Not wondering if there’s anything you can do to make more money. Feeling that everything is fate, that there is nothing you can do to change it, and failing truly to test that belief.

Here’s an example of passive underearning from my own life. As a consultant, I break writer’s block for people, forever, in one four-hour consultation. For a long time I did this mostly by referral, by word of mouth. If you happened to run into someone who happened to know me, and if that person happened to tell you about me, and if you got my phone number, and if I happened to be home when you called, and I felt I could make myself available, then I would probably do it for you.

When someone suggested to me that this was a valuable service and would probably be widely desired, that it could be a good source of income for me, and that I should advertise, it took me more than a year to bring myself to the point of being able to do that. I couldn’t bear the thought of advertising or putting my name and phone number in print, of having people call me personally, and thinking that I would have to sell myself over the phone.

Finally I did, and the response was extremely positive. But even then, it took me four years to raise my rates from where they were when I began to where they are now, which is nearly seven times the original amount.

Peter is a very bright guy in his early 40s who had a history of debiting and a very checkered working life. He had long periods of low income interspersed with occasional periods of high income. He’d been living pretty leanly for several years, working part-time jobs and as an office temp. He was drawing unemployment and scarcely getting by when I met him. When a friend set him up for a nearly guaranteed job with a bookstore, Peter didn’t even make the call. He told me he probably wouldn’t make any more there than he was getting from unemployment. He said that if he took the job, he wouldn’t be available for something better. He might have been right. It may not have made sense for him to take that job, but the point is, he hadn’t even bothered to make the call to find out. That is passive underearning.

Where underearning comes from   

Where does underearning come from? That’s a question that people often ask me. Where does underearning come from? Well, the stars. Your childhood, metabolism, past lives—who knows? I don’t. Freudians would probably have one argument; psycho-pharmacologists would have another. People steeped in ACA theory—that’s Adult Children of Alcoholics—would be quite certain they knew. So would a lot of astrologists, who would dismiss the ACAs. Rational-emotive therapists would dismiss the Freudians, the ACAs, and the astrologists. Trans-channelers would have a different opinion altogether; so would new age thinkers. And that isn’t even to begin to mention the others, like sociologists, multiculturalists, the pope, or even your mother!

There is probably some truth in everyone’s idea, and more in ideas that we don’t even suspect yet. But the point is, how I got hurt is less important than that I am hurt. If I get up in the middle of the night for a glass of water and don’t turn on the light, slip on an ice cube I dropped earlier, fall over a misplaced chair, and break my leg, my problem is a broken leg, not how I broke it. In fact, knowing precisely how I broke it, the exact sequence that led to the injury, won’t help me a bit. My need, first, is to understand that my leg is broken, and, second, to take what action I need in order to get it repaired.

So where it comes from and even how we became resigned to it, which is nearly always an unconscious process, is less important. I mean, no one ever rubbed his hands together and said, “Oh, boy, I can’t wait to grow up and become an underearner!” That never happens. Knowing that you are an underearner is what is important. Then you can take the steps necessary to remedy underearning.