high salary, six figures, seven figures, job, danger, financial independence, early retirement

The Dangers of a High Paying Job


There Are Dangers to a High Paying Job?

The basic tenets of personal finance go like this: spend less than you earn, save and invest as much as possible, pay off your debt, and make as much as possible.

Today I’m focusing on the last part. While many people maximize their earnings through the use of side hustles, some earn a lot of income from their primary job.

While there are distinct advantages to a high salary, earning a lot of cheese is not the cure-all that you might believe it is. Read on to see four dangers of a high paying job.


Every reason that high salaries can be dangerous to your financial future is related in some way to a lack of discipline. The reasons are also interrelated, so it’s common to have more than one affecting your attitude to money.

It’s essential to maintain discipline even when you don’t think you need it anymore. Anytime I become lax in any area of my life, I’m typically prompted by a swift kick in the ass to get back on the right path. The clouds part and something descends, deus ex machina, to keep me humble.

Remember this: getting lax produces the harshest tax. 

Danger #1: Lifestyle Inflation

Everyone has heard of lifestyle inflation; this isn’t exactly a surprise, is it?

You get a nice raise, and suddenly your old Honda Civic isn’t looking so hot anymore. “I need something dependable,” you tell yourself. “I’ve earned this!” might be another thought in your head.

You haven’t earned a damned thing! Get your head out of your fourth point of contact and stay on task. Automatically save and invest any increase in your check and forget it happened.

Danger #2: Lifestyle Aspiration

One thing I’ve noticed about lifestyle inflation is that it tends to outrun whatever increase in pay you snagged.

It starts off with the typical “but I earned it” creampuffery but usually it advances to “I’ve got to look the part” and “you’ve got to spend money to make money” maxims familiar to those on the precipice of ruin.

I fell HARD into this trap in my mid-to-late 20s. I’m talking about

  • $500+ Ferragamo, Church’s, and John Lobb shoes
  • A BMW M5 that cost at least $3k every time it had something go wrong with it (often) and had $300 oil changes
  • $3,000 bespoke suits (yes, plural)
  • Club Suites in the Ritz-Carlton Tokyo, which I don’t even remember because I got plastered with a Japanese friend of mine at an izakaya
  • A $400 Mont Blanc fountain pen

I was a fucking idiot! I once started to calculate how much this spending cost me by using the Money Multiple, but my mind wasn’t prepared for that level of horror.

While I was an extreme example of Lifestyle Aspiration, Sam at the Financial Samurai wrote a great post showing how a family can breeze through a $500k income without being extravagant.

Danger #3: All-Nighter Mentality

This is another danger I’m not proud to say that I also experienced first-hand. I’m sure you, like most people, have at one time or another pulled an all-nighter to get some project for school done on time.

I was notorious in both high school and college for doing nothing during the semester and then busting my hump to ace exams and projects. I had the same approach with the SAT, and luckily everything usually worked out for me.

However, by the time I got to grad school, I lost this “superpower” and had to knuckle-down like any good student.

Walking on the wild side makes you think that you can outwork your previous deficiencies and catch up. The problem with this thinking is that life happens and you are perilously vulnerable if you feel this way. Any little thing can come along and ruin your grand plans. It’s an incredibly stressful way to live and unsustainable long-term. I found the stress exciting, but as I got older, I lost my patience with that life.

Having a high paying job can be like this as well. You put financial planning and your financial fitness on the back-burner. Hey, why not, you can always quickly ramp things up when you need to, right?

Wrong. You may lose your job, find yourself in a hole your salary can’t dig you out of, or just be unable to taper your spending when you need to. The odds of you pulling a rabbit out of your hat late in the game are slim, and you’ve missed out on years of compound interest. 

Danger #4: The Spend It Before It’s Gone Mentality

I grew up relatively poor, though I didn’t know it at the time. My father provided for our family of five, in the United States, with an income of less than $18k per year.

My parents always had great money habits and were able to support us on that meager salary.

  • All of our clothes were from Goodwill or hand-me-downs from friends
  • We only bought furniture from yard sales or grabbed it from the side of the road
  • We’d never buy anything unless it had a coupon
  • I’d wear the same clothes to school for two or three days in a row
  • We ate rice and beans frequently and going out to eat, even McDonald’s, was a rare luxury

For a lot of people, that’s just being frugal (or you live in Williamsburg). You can’t call it that if it isn’t a choice.

I’ve met a few other people who grew up poor, and I’ve noticed something: we tend to break one of two ways. We either become incredibly frugal as adults and watch every penny, or we do the complete opposite. I call it the “Spend It Before It’s Gone” mentality.

If you become accustomed to not having a lot, suddenly having something, or even worse, a lot, is an odd place to be. You’re not quite sure what to do with the situation.

I was uncomfortable with money. I unconsciously assumed that I’d revert to not having cash through some twist of fate or curve-ball from life (like getting robbed, which happened several times) so I’d overspend. “Enjoy the money while you’ve still got it,” I thought to myself.

It’s twisted thinking, and it’s completely illogical, but I’m telling you the truth. This kind of thinking is pervasive in lower-income households and is one reason why a lot of people will never escape that cycle. Selling rims on layaway should not be a business with any demand, but we had places like that in my hood because this mentality is prevalent. Gun store, liquor store, payday loan center, hot wings, layaway rims. Rinse and repeat.

Make sure you’re not sabotaging your success with this mentality. If you find it hard to stick to even a loose budget or resist spending on the latest trinket, you may need exorcism from this demon.


If you’re not making a lot of money right now, a high salary seems like a godsend. “I’d never burn piles of money in a dumpster fire like Moose used to!”, you might think. You may be right, but patterns of human behavior say otherwise.

A high salary coupled with bad financial habits only accelerates your path to ruin. Unfortunately, many people who are “rich” still live paycheck to paycheck.

If you’re earning a lot of money now, guard against these four dangers of a high paying job.

If you’re not earning much now, get your financial game tight so that when you eventually DO make a lot of money, you are efficient with your extra dollars and get to FIRE instead of setting your cash ON fire.

Do not bemoan the fact that you’re not earning much. Take pride instead in the fact that you’ve gotten so far on a modest paycheck. 








  1. Jason@WinningPersonalFinance February 20, 2018
    • Moose February 20, 2018