
1/31/2025-Commissions: how much to SAVE?
Published on
Skill
Setting personal finance goals is no different than setting revenue goals and strategies for your patch. Sellers who plan, execute, and commit to financial discipline gain control of their careers.
That whole myth about your manager wanting you to spend your commission (and buy cars and houses) is a yesterday fable. The best managers know money is not the sole motivator that pushes sellers.
While spending money on stuff is fun, sellers who financially plan for the future gain career flexibility.
To get financially independent, follow the 50/30/20 spending rule: 50% of your net income should cover needs, 30% goes to wants, and 20% goes to savings and investment.
Follow that rule, and you’ll be golden faster than you think.
Do
Set your plan to spend your 2025 earnings.
You know what your salary is. And you know the range of what you’ll make in commissions.
And because you know generally what your expenses will be this year, you can plan where your ’25 commissions will go.
Allocate for that 20% investment goal today will guarantee you get there this time next year.
Creating financial independence as a career seller is so important because, let’s face it, a career in sales is volatile. The rewards are big, but so too are the risks. The sooner you treat yourself as your most important client, the better you’ll be.
And while the paydays in sales are super fun, you must spend your future commissions on your goals before it hits your account. PAY YOURSELF first and invest the money before paying for stuff that will eventually turn into junk.
Here are the steps you’ve seen everywhere, but now it’s time to put them into action for you.
1. Set Financial Goals: Clearly define what financial independence means to you, including the desired lifestyle and target amount of savings.
2. Automate Savings: Set up automatic transfers to a dedicated savings account to ensure consistent contributions.
3. Get a good investment advisor: S/he will teach you how to invest so that your $50,000 commission check today turns into $100,000 in 10 years (assuming a 7% return).
Plan your work, work your plan.
Oomph
This hilarious SNL skit about NOT spending money you don’t have hits the nail about the fiscal discipline you need as a seller.
Yes, it’s fun to buy stuff when those lump-sum commission checks come in, but sales jobs are risky.
As many times a week you fall in and out of love with your job and company, your company might be doing the same with you. (Ouch…sorry.)
Get financially independent as fast as possible.
Quote of the day
"Enjoy the magic of compounding returns. Even modest investments made in one’s early 20s are likely to grow to staggering amounts over the course of an investment lifetime." John C. Bogle