Today I want to talk about a topic that affects a lot of accountants, but isn’t talked about enough.  I believe this is important because even though we are smart professionals doing smart things, we can fall into the trap of underearning. 

It seems kind of crazy, right? We spend all this time boosting our clients’ bottom lines, but when it comes to our own earnings, we somehow fall short.

Think about it – we work hard, we’ve got all this education, skills and qualifications, yet our income often doesn’t seem to match up with what we know we’re capable of making. Have you ever felt that frustration?

And then there’s the whole issue with not valuing ourselves enough.  For example, we might be great at what we do, but when it comes to negotiating salaries, increasing our rates, or even acknowledging our own worth, it’s as if we freeze up.

I was reading about this organization called ‘Underearners Anonymous’, similar to other 12-Step type organizations like ‘Alcoholics Anonymous’ and they describe underearning as more than just a money issue. It’s more like we’re holding ourselves back from reaching our full potential.

For example, Underearners Anonymous talks about how we hide from life and settle for jobs that don’t really fulfill us. It’s as if we’re living in this fog of uncertainty, never really seeing our true worth or taking the steps to reach it.

Plus the feeling of self-doubt or shame can keep us hiding.  Or if we feel imposter syndrome it makes sense that we would most likely be earning less than we’re worth.

It’s crazy how we can be so good at helping others with their finances but struggle to do the same for ourselves. Thankfully, we can break out of this cycle. 

We just need to start recognizing our own value, stop selling ourselves short, and start taking those steps towards a better financial future. If you’ve been underearning, I get that it’s not easy to break out of the cycle, but I believe it’s worth it in the long run. 

Understanding Underearning

As Underearners Anonymous explains, underearning is about more than just not making enough money—it’s consistently falling short of what you could be earning, even though you’ve got all the skills and qualifications to be making more money. 

It’s not just about the numbers on your paycheck; it’s about feeling like you’re not reaching your true potential, despite knowing you’ve got what it takes to do more and make more.  

According to Underearners Anonymous, here are some common signs of underearning to be aware of:

Time Indifference: This is basically procrastination. It’s when you keep delaying important tasks and aren’t using your time effectively to work towards your goals.

Idea Deflection: If you tend to shoot down good ideas for no reason, that’s idea deflection. It’s when you reject ideas that could actually help you in your life or career, just because.

Compulsive Need to Prove: This is about knowing when you’re really good at something, but you keep feeling like you have to prove yourself over and over again.  Even though you’ve shown you’re capable, you keep feeling the need to prove your worth.

Clinging to Useless Possessions: This is about holding onto things you don’t need anymore. Like, keeping old clothes that are falling apart or broken appliances that you never use.

Exertion/Exhaustion: This is a cycle of overworking yourself until you’re completely exhausted, and then either not doing enough work or not working at all.

Giving Away Your Time: Ever find yourself always volunteering for things that aren’t in your best interest? Or offering your services for free when you should be getting paid? That’s giving away your time.

Undervaluing and Underpricing: This is when you don’t realize how valuable your skills or services are, so you end up charging less than you should or not asking for raises when you deserve them.

Isolation: Choosing to work alone even when having others around could actually help you out.

Physical Ailments: Sometimes, when you’re afraid of standing out or taking on more responsibility, you might start experiencing physical health issues to avoid having to take action.

Misplaced Guilt or Shame: This is when you feel bad or uncomfortable about asking for what you need or what you’re owed.

Not Following Up: If you’ve ever let good opportunities slip away because you didn’t follow through, that’s what this is about. You start things but don’t finish them.

Stability Boredom: This is when you create unnecessary drama or conflict at work, which ends up causing financial problems.

Like I said before, underearning isn’t just about not making enough money. It’s also about how we think and feel about money and success. As I’ve shared before on this podcast, our feelings drive our actions and if we’re not aware of the feelings causing underearning, we’re never going to stop the cycle.

Three Prominent Factors

Now that you know the common signs of underearning to be aware of, let’s talk about three prominent factors in underearning. 

Fear of Success: This is when you’re scared of what might happen if you actually succeed. It makes you hold back and avoid opportunities that could make you successful because you’re worried about what might change.

Have you ever had that happen?  Where you’re so comfortable where you are or doing what you’re doing that you hold yourself back from an opportunity in order to keep things the same?

Limiting Beliefs About Money: Your beliefs about money, often shaped by things you learned when you were young or from society, can hold you back. These beliefs create mental blocks that stop you from going after the money you deserve. 

You’d be surprised how much you are affected by your parent’s beliefs about money growing up. If you grew up watching your parents or others struggling, your brain has been wired to believe that money is a struggle.  

Lack of Self-Worth: Underearners often struggle with feeling like they’re not good enough. This feeling can make it hard to stand up for yourself and ask for what you’re worth at work. 

Have you ever had an issue with self-confidence or imposter syndrome?  When this goes unaddressed, it can cause a big issue with underearning.

So, whether you see yourself in one or more of these factors, it’s important to recognize when underearning tendencies pop up. Once you’re aware of them, you can start doing something about it.

Your Brain’s Role In Underearning

As I’ve said various times, this is the podcast that blends brain science with accounting.  I believe it’s incredibly important to understand how your accountant brain plays a pivotal role in shaping your financial success. 

I live 30 minutes outside of Manhattan so I like to teach my clients to think of their brains like a major city with lots of roadways that take people from place to place.  Your brain has what’s called “neural pathways” or little roadways that control things like making decisions, taking risks, and reacting to money situations. 

These neural pathways are developed over time and what’s most important to understand is that those pathways influence how much you earn.

For example, if you’re someone who’s always playing it safe or gets nervous about success, your brain will steer you away from making big career moves or asking for that raise you deserve.

The other important thing to understand about your brain is that it loves a good reward.  When you score a financial win, it releases these feel good chemicals, which you naturally want more of.  

But on the flip side, if the topic of money stresses you out or you’re scared of messing up, your brain will hit the brakes. If your brain is too focused on avoiding losses, it could hold you back from going after bigger opportunities.

And let’s not forget about success—it can be great and scary, all at the same time.  If the idea of being successful makes you feel nervous or jittery, your brain will resist taking steps toward it, even if it means more money in your pocket.

Here’s the thing – understanding how your accountant brain works will help you figure out why you might be underearning and, more importantly, how to stop.

This is where the concept of neuroplasticity comes in.  Neuroplasticity is the amazing ability that your brain has to adapt and rewire itself based on new experiences. 

So, even if your brain’s used to certain earning habits or you’ve reached an earning plateau, you can shake things up and start earning what you deserve.  In other words, you can absolutely rewire your brain to stop underearning.

That’s what my Smarter Accountant Program is all about. I teach smart accountants how to spot those unhelpful underearning habits that your brain’s stuck on and how to break free from them.

Bottom line? You do not need to be stuck in an underearning rut. With a little brain management, you can take steps to earn what you’re capable of earning. 

Practical Steps To Stop Underearning

Now that you understand underearning better, let’s dive into some actionable strategies:

Setting Realistic Financial Goals: Start by thinking about what you want to achieve with your money in the short and long term. Make sure your goals are realistic and match what matters most to you. For example, if being able to decompress from your accounting work is important to you, you could have a goal of owning a second home on a lake in the next 5 years.  Having something meaningful to work towards can help you break the underearning cycle.

Building a Strategic Career Plan: Figure out what you’re good at and where you can improve in your accounting career. Look for opportunities to grow within your current job or explore new paths that fit your goals. For example, if you’ve been holding yourself back from exploring a different area of accounting or not going after your dream of going out on your own, begin to reverse engineer how you can make that happen and create a plan of action. 

Negotiation Skills for Salary and Promotions: Know your worth by researching what people in your position typically earn. Practice negotiating with someone you trust and prepare responses to common questions. For example, YouTube has great videos on the latest trends in interview or negotiation questions. Keep in mind how lucky the company is to have you.

Learning How to Manage Your Mind: To stop the underearning cycle, you need to understand that your thoughts create your feelings, and your feelings drive your actions. Identify any negative feelings holding you back from earning what you deserve, and figure out the thoughts behind them. 

For example, if you feel fear, then get clear about the thought creating that feeling.  It could be something like “I’m afraid I don’t know enough” or “I don’t want to fail.”  Now address each thought by offering an opposite like “I know more than I’m giving myself credit for” or “I’d rather try and fail than not try at all.”  By choosing thoughts that make you feel empowered and capable, you replace self-doubt with confidence. 

By integrating these practices, you’ll not only feel more empowered but you’ll also create a much more supportive mindset as well.  

Becoming a Smarter Accountant: Ending The Underearning Cycle

Now let me share some of the stories of coaching clients that ended the underearning cycle.

One client I worked with struggled with a lot of self-doubt. Despite being smart and capable, she grew up in a family where underearning was the norm, and she learned to settle for just getting by. 

But after just a few weeks of working together, she started recognizing those negative thoughts that were holding her back. She became more proactive, seeking out opportunities to grow and taking on challenging projects at work. 

She also learned how to negotiate for fair pay and express her true value confidently. Now, she’s a manager at a mid-sized firm and is aiming for even higher positions. 

It’s been amazing to see her break out of that underearning cycle and thrive in her career.  She’s also become a great example for her children.

Another client struggled with the fear of success. He felt torn between wanting to achieve his goals and being afraid to go after them.

To break free from underearning, he decided to face his fears head-on. He realized that fear was holding him back and that success wasn’t something to fear but an opportunity for growth.

He started by setting realistic financial goals and breaking them down into smaller steps. This approach helped him tackle underearning while also boosting his confidence.

He also worked on improving his negotiation skills. Instead of seeing negotiation as something greedy, he reframed it as advocating for fair compensation. 

By confidently expressing his value to his company, the possibility of greater success and more opportunities opened up for him.

And the last client I want to share struggled with confidence. She had her own small accounting firm, but she wasn’t charging her clients what she deserved, and realized that they were taking advantage of her.

But once she joined the Smarter Accountant program, she was blown away by how much her own thoughts were holding her back. She realized she needed to get a handle on her mindset if she wanted to stop underearning.

So, she started replacing those negative thoughts with positive ones about her skills and worth. She began to see that her clients were actually lucky to have her, and if they didn’t see that, she was okay letting them go. 

This change in mindset not only made her feel more confident but also helped her stand up for herself when it came to pricing her services.  She increased her rates and when a client left, she knew she was making room for clients that wanted the services and the value she provided, at the price she deserved to be paid.

Although these three clients each overcame distinct challenges, they all share a common thread – wanting to stop underearning by becoming a Smarter Accountant.  Thankfully, they successfully broke free from underearning patterns, making it possible to have the successful careers, businesses, and lives that they deserved.  

Well, that’s what I have for you.  Thank you for joining me as I discussed why you are underearning and how to stop.  I hope you’ve gained valuable insights and practical tools.

If you are struggling with any aspect of being an accountant, you can simply go to www.thesmarteraccountant.com/calendar and book a free session with me.

I’ll explain The Smarter Accountant 6-week Program and how you can apply it to whatever you’re struggling with.

That’s what I have for you, but make sure you check back each week as I help you go from being a stressed accountant to a Smarter Accountant.

Make sure you go to www.thesmarteraccountant.com and take The Smarter Accountant Quiz. You’re going to want to know if you’ve been underutilizing your accountant brain so that you have a starting point for becoming a Smarter Accountant.

Also, I would appreciate it if you could get the word out to other accountants about this podcast.  The more accountants find out about it, the more we can begin to change the narrative in the accounting profession.

The truth is that you’re already smart, but this podcast will show you how to be smarter.