Make It So that Salary Gap Doesn’t Matter

There is a huge salary gap between minorities and white men. One of the major complaints from minorities is that we get paid less than our white male counterparts. By minorities I’m referring to blacks, Hispanics, and women. These complaints are statistically valid. Here are some of the current statistics that are floating around out there.

  • White Women Get Paid 20 Percent Less than White Males
  • College educated Black and Hispanic Males get paid 20 Percent Less than White Males
  • College educated Black and Hispanic Females get paid 30 Percent Less than Caucasian Males

How I Made it So That Salary Gap No Longer Matters?

Depending on which article you read the salary gap differences differ but it’s definitely there. The fact that minorities get paid less than Caucasian Male counterparts is a reality. However, In this blog post, I will describe how I made it such that salary gap no longer matters for me personally. The method that I used to make it so that the salary gap doesn’t matter is to focus on Networth growth not employee salary growth. Again, Over time, I’ve focused on Networth growth not employee salary growth or even job promotion. Networth is “the amount by which assets exceed liabilities”. The primary thing that I have done over time is to focus on asset accumulation. One of the primary methods of asset accumulation that I’ve used is to use the Malcolm method of investing to increase my overall networth. See more on Malcolm Investing in my post, “Why I Don’t Like Index Investing?”. I’ve made it such that both in 2017 and 2018, I’ve increased my Networth by more than my salary. By April of 2018, I’ve surpassed my full year 2018 employment salary just on networth gains. Over time, the gap between salary and yearly Network worth increase should naturally increase just purely based on compound interest. The main thing that I’ve done is to focus on increasing my “Virtual Salary” where Virtual Salary is the following below:

Virtual Salary = (Income from Salary) + (Networth Increase or Decrease for the Year)

Let’s go back to our earlier discussion about minorities making 30% less than White male counterparts and now instead of using salary let’s use “Virtual Salary” to compare myself to my colleague. Even though I may or may not make 30 Percent less than a white male counterpart, when I factor in my “Virtual Salary”, it’s highly likely than not that my “Virtual Salary” is higher than my counterparts “Virtual Salary”. The chances of my “Virtual Salary” being higher is even greater if I am using “Malcolm Investing” while he is using the Joe method of investing described in “Why I Don’t Like Index Investing?”. A consistently high “Virtual Salary” makes it such that I care very little about the following things:

I don’t care if I ever get a raise.

I don’t care if I ever get a bonus.

I don’t care about ever getting a promotion.

Yes, the above items are nice to haves and may or may not just naturally happen but I only care about increasing my “Virtual Salary”. “Virtual Salary” can be increased without promotion, bonus, or raise. Yes, these things help in increasing “Virtual Salary” but they are not needed. Focusing on “Virtual Salary” makes it so that I focus on doing the best job possible and staying a high contributor in my employment without ever caring about promotion, bonus, or raise. Minorities, who are historically paid less need to absolutely focus on increasing “Virtual Salary”. The only way to do this is via consistent saving and investing. The Malcolm method of investing is also an important part of increasing “Virtual Salary” and making it so that wage gap doesn’t matter.

Overcoming the Salary Gap – Virtual Salary Definiton

Virtual Salary is defined as your yearly income from salary plus your networth increase or decrease for the year


Have you ever been under paid? Have you ever been passed over for a promotion? What have you personally done to counter this?

Leave a Reply