Our net take home pay per hour

I was going to write about possibly starting a DBS DigiPortfolio for my wife. Mostly because I saw how a few financial bloggers have written about it at the same time. Might be a collaboration exercise with DBS to promote this financial product using sponsored posts. Which is fine with me since I can see how it benefits both parties.

What surprised me was the negative comments that Brian at A Path to Forever Financial Freedom (3Fs) received on his post about him setting up the DBS DigiPortfolio and not initially disclosing it as a sponsored post. Wow, readers are sensitive about this issue yeah.

Anyway, doing sponsored posts for a financial blogger is a fine line to walk. If you promote a financial product that you don’t use yourself, it’s difficult to convince your readers why they should use it. If you promote a financial product that you use and believe in yourself, it’s difficult to convince your readers why there is no conflict of interest.

This is the reason why I don’t do sponsored posts. I can write what I want about the financial product, both the good & bad. And I don’t have to care what the sponsor thinks about my opinion. I don’t even let ads appear on my blog. The only financial benefit I get is from readers using our referral links to sign up for StashAway and Smartly robo-advisor accounts, which translates into management/platform fee waivers.

Even for that, I struggled with the decision and only went ahead with it this year. Because I concluded there still has to be a bit of monetary benefit for me to keep writing on this blog. I have no intention to make money from this blog yet. Which is why the posts’ topics are narrow and about what my wife and I do with our lives. Not the broad topic kinds that attract more readers.

I have no big dreams of being self-employed or starting my own business in the short term. Maybe not even in the medium term. I like what our corporate jobs offer us for now. Of course, this can change if our roles are restructured or made redundant. For now, it’s important to understand what are we exchanging our time for in the office.

We work in banking middle-office support function jobs (risk management and compliance). We are decently paid with minimal travelling or overtime required. There’s no sales pressure and our colleagues are okay because there’s less competition with each other. The stakeholders we deal with are manageable but can be mean & nasty at times (especially those from the front-office). And we don’t work on weekends.

Sometimes, things can still go badly due to a combination of unfortunate factors like in my previous job. However, it’s possible to move into another bank or financial institution to change your work environment. Which is what I did given that the skill sets are transferable. We expect this to change in the next decade so it’s up to us to keep ourselves relevant.

What comes next is an important exercise that a corporate employee should go through. Calculating our net pay per hour. Then we truly know what and how much we are exchanging our time in the office for. On a weekday, we generally head out at 8.30am and come back at 7.30pm. Which translates into a 11 hour workday on average when you take into account the transport time and don’t exclude the 1 hour lunchtime.

There’s 11 days of public holidays and we have about 25 days of leave in a year i.e. 36 non-working days in total. With 22 workdays in a month, this means we don’t work for 3 of those days on average i.e. 19 workdays. We take our cash salary credited into the bank account (excludes CPF contributions and bonus payments) and deduct the monthly income tax instalment from it. Then we divide the figure by (19*11) to get our net take-home pay per hour.

My wife’s net take-home pay per hour is $50 and my net take-home pay per hour is $30. It’s essential to know this for all kinds of decision making purposes. Like whose job brings home a relatively higher income and should be prioritised & worked around. Spending on convenience and time savings for my wife make more sense when you think about how much shorter it takes for her to earn back the money.

More importantly, it’s how we measure the progress in our careers and its sustainability. The aim is to increase the net take-home pay per hour in proportion to the stress & pressure we face and the risk & responsibilities we take on. It’s more sustainable if this can be a linear relationship, meaning you are paid as much as your value.

Otherwise, it’s not sustainable if you are underpaid or overpaid relative to your value. This is assuming your industry itself is not going through or about to go through a structural decline. Because that just means you are going to be a target for retrenchment since your value goes down regardless of what you do.

If we find ourselves doing more for the same pay, we either ask for a higher pay or move to another job. But we can be worse off with a job move that has a higher pay but has increased working hours in a toxic work environment. We are aware and mindful of our net take-home pay per hour for so many reasons. We even monitor it to ensure that we are not sliding backwards in our career development.