Hourly vs Salary: Can You Pass Up Overtime When In Debt?

Imagine you are just finishing up your day working 9-5 and your manager stops by and asks you to stay later or to come in on a Saturday, it probably catches you by surprise, what is your response?  For many the immediate reaction is “Why would I want to work more?”  Then it hits you,  as an hourly employee your manager is asking you to increase your income, what reason do you have to say no?  It’s at that moment from the time you say YES or NO that a million things are running through your head.  They all revolve around should I work overtime and earn more or do I have something better to do?

In Debt

I’m making the assumption that you have some sort of debt in your life:  credit cards, student loans, medical debt, car loans, who knows maybe you owe your friend $20 for the bet you made that this was the Cubs year and would win it all (I Believe!).  That’s when we all start thinking long and hard about what is important to us in our financial and personal lives.  I personally have debt so to pass up extra income at this time in my life is a difficult thing to do for me and the number of us out there in debt.

Imagine you make the national average salary which is right around $52,000, then figuring out some simple math says you earn $1,000 per week and thus $25 per hour.  In most cases of overtime you are paid at 1.5X your hourly rate, which comes to $37.50 an hour, which amounts to $78,000 a year if you were to make this hourly rate for the entire year.  When working a full 8 day at $37.50 per hour, you would make $300 per day, all for doing the same thing you would do on a regular week day.  Can you afford to pass up $300?

As a person who’s goal is to become debt free or Even Steven as I prefer to call it and reach financial independence as fast as humanly possible, I look forward to the opportunities to earn a little more to pay off debt and invest more.  I know we all need to live in the moment and enjoy life, but if you are going to have a quiet weekend around the house I don’t think we really have a better choice than to come in to work and earn extra income.

Today I came into work and earned a little extra money, maybe I’ll throw it at my debt or invest, who knows I may even spend a few dollars of it while on vacation.  I believe I made the right choice and worked overtime to earn more income, what would you have done?

12 Responses to “Hourly vs Salary: Can You Pass Up Overtime When In Debt?

  • I used to love to work OT, and would jump at the opportunity to earn extra money but for the last 15 or so years I’ve been a salary guy. I would if I could come in to earn that extra cash.
    Brian @DebtDiscipline recently posted…Week End Round Up #87My Profile

    • EvenStevenMoney
      3 years ago

      Yeah if the opportunity is available I’m ready to jump at it, maybe down the road the opportunity will not be available, might as well have them pay me extra to come in and work a little extra.

  • This is one I struggle with. It’s hard for me justify working an extra day of OT. After taxes (I live in CA) I’m always disappointed, it just never feels like it was worth it. Well I am still working towards FI though, I do try to say yes to OT, if I don’t have plans.

    • EvenStevenMoney
      3 years ago

      Extra taxes yes, but extra contribution to your 401k!!!!!! Probably didn’t win you over, but I know I won’t be in debt forever or working hourly forever so I might as well jump on the OT while I can.

  • I know people in the trades who make more than a lot of white collar jobs due to over time. Plus they only have to worry about their jobs when they are there, and don’t have to worry about emails coming in the evening to do more work from home 🙂
    Fervent Finance recently posted…HSA InvestmentsMy Profile

    • EvenStevenMoney
      3 years ago

      I will say that usually during overtime work, their is a focus to complete a certain task rather than doing your job as a whole, which can be nice.

  • I’m a salaried worker so I never like working overtime! Most of my hourly jobs never allowed for much overtime, but when I worked at CVS I liked to work on some holidays to earn 2x my normal wage.

    When I was younger, my Dad used to work half days on Saturday or Sunday when possible, as he received 1.5x overtime pay.
    Debt Hater recently posted…Student Loan Progress – June 2015My Profile

    • EvenStevenMoney
      3 years ago

      It’s something that I think people should really consider when it’s available because as you know it doesn’t last forever. I only have the opportunity to work overtime a few times a year so it’s easy to make the commitment for a few extra dollars.

  • Nice job Even Steven, I think at the right times in your life, making the most of these opportunities to earn a little more is a great idea. Especially if you have a strong, burning goal to reduce debt or achieve FI, and it’s not compromising other important things in your life at that point.

    You’ll be ‘Even Steven’ before you know it, and then hopefully you’ll never have to worry about such decisions again!


    Jason @ Islands of Investing recently posted…2015 Goals Part 2: Non-financial goals, and reflectionsMy Profile

    • EvenStevenMoney
      3 years ago

      Agreed. Plus you never know when the little opportunities could lead to something bigger, but you are right it’s more important to go after what is important to you.

  • Much of the same logic applies to getting a part time job, or a side hustle. If you’ve got debt, want to invest more, or have some sort of financial goal you’re motivated to achieve, what’s worth more to you – having all your evenings and weekends free….or spending some of that time doing something to increase your income??
    Brock @CleverDude recently posted…Help A Blogger Challenge: Can My Lawn Mower Be Fixed?My Profile

    • EvenStevenMoney
      3 years ago

      You definitely have to get after it in one way or another to have choices available to you, extra money and savings certainly can provide that.

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