• HEX: #9a999f
  • RGB: rgb(154, 153, 159)
  • HEX: #2d2622
  • RGB: rgb(45, 38, 34)
  • HEX: #585047
  • RGB: rgb(88, 80, 71)
  • HEX: #4e433c
  • RGB: rgb(78, 67, 60)
  • HEX: #f7f5f2
  • RGB: rgb(247, 245, 242)

Figure Out Your “Inflation Adjusted” Salary

When I was in elementary school we had one of those “career days” where parents come in and share what they do for a living, what their jobs are like, how much they make, and a bunch of other stuff. During this career day one of the parents, who seemed relative well off (doesn’t matter what he did), shared that he made $60,000 per year.

Ever since that day, for one reason or another, $60,000 was always the number that I benchmarked salaries against. The problem with this logic is that money devalues over time based on inflation.

For those of you interested here is a link to the inflation rate, by month, for the past 100 or so years.

This past week I decided, for the hell of it, to see what my inflation adjusted salary would be if I was the guy that presented to my class in 1995. Using this inflation calculator, or perhaps the Bureau of Labor Statistics calculator, you can figure out what your salary would be both looking forward and looking back.

$60,000 in 1995 = $93,477  in 2015

I look the salary I make right now, and even though I’m far more qualified, intelligent, and motivated than the parent that presented to my class in 1995, I’m still making less than he was in 1995.

The fact is, salaries are not growing with inflation.

Take a look at the average physician salary in 1995 and then cross reference it with the national average salary for primary care physicians presented on Glassdoor. Plug in the numbers and the conclusion is that the average primary care physician is making $45,000 less than they should today, and about $30,000 less than they were in 1995.

To add insult to injury, education, grocery, and medical costs have grown at astronomical rates, pensions, 401k matches, and other work related perks have ceased to exist, and Americans are working harder, longer, and more ruthlessly than ever to keep their job, or compete for a new one.

In my mind all of this is not ok, and it has happened over such a long period of time that we can’t perceive the changes that have transpired. Boiled frog.

Here is a fun (read depressing) video that highlights the first half of this post, but fails to highlight the cost of living increases, increased productivity, and other aspects of the economy that I mention in the second half:

Subscribe for More!

I send out a monthly newsletter on various topics.

Take a moment to enter your details, and you can select the news you would like to have delivered to your inbox!