One thing I've noticed about money/salary discussions is how often people lie or mislead. A lot of people tend to be insecure about what they make, thinking they’re not keeping up with the Joneses, so they tend to embellish, or at least round up very generously. Personally witnessed this multiple times, hearing someone state a figure that I knew wasn’t true, or extremely misleading. Some things I’ve seen (and some I’ve heard about from others):
A guy makes $44k base salary, for ease of discussion he’ll round it up to $50k (even though it makes more sense to round to $40k or $45k). Eligible for a 5%-20% annual bonus. So he calculates 20% of his rounded up $50k salary which comes out to $10k, so now he’s at $60k total. What he doesn’t tell you is the company has never (or very rarely) ever performed well enough to give a 20% bonus, what he typically gets every year is more like 5%-7%. Did he also get a work laptop that he takes home and doubles as his personal computer? Work cellphone? Work tablet? Is there a free or discounted gym facility on site? Discounted Stock Purchase plan? Does his boss give him $5 Dunkin Donuts gift card a couple times a year? Well then he adds at least another $5k onto his salary to account for all that. If he drives a company car/truck/van, he tacks on another $10k minimum. That’s how a guy making $44,000 in base salary + $3,080 annual bonus for a grand total of $47,080 tells you he makes $65,000 a year and makes you feel like you make less than him even though you earn relatively the same amount.
Or then there’s the guy who legitimately makes $60,000 per year. Sold something that he doesn’t normally sell (inherited a piece of land, grandmother bought him $100 worth of Apple stock 30 years ago that he finally sold, found a rare artifact in his basement, etc.). Even though it’s a one time, rare occurrence, he takes the $40k he got selling whatever and tells you he made $100k last year. Doesn’t tell you it was one year only, and he’ll likely never make that much again. Very misleading.
Then you have the guy who makes $30k per year, but married to a lawyer, doctor, nurse, executive, etc. He makes $30k, she makes $80k-$120k, so he adds them together and tells you he makes $150k. He either lets you think he earns all that himself, knowingly misleading you (when confronted will feign ignorance “oh I thought you meant household income”), or he’ll split it in half and says he makes $75k (since $150k/2 = $75k). Won’t say anything when you say “wow, you make $75k, and your wife makes a lot in her big time job, wow you guys make over $200K!”
Or the guy who makes $35k working the night shift or weekends and watches the kids during the day. Because he doesn’t have to pay for daycare now, he estimates he saves $15k per year (generously rounded up of course). Adds that savings to his salary, tells you he makes $50k.
Or the guy who invested some money but has no idea what he’s doing. Bought some big name stocks at the right time and is up $10k-$20k currently. Hasn’t sold anything yet so he hasn’t realized any actual gains, but adds that extra $10-$20k his portfolio is up into what he makes. When his portfolio is down $10k though, he conveniently doesn’t subtract any losses.
Or the guy who tells you what he projects he’ll make next year as his salary now. Always thinks his big break is right around the corner, he thinks he’s just about get that dream job, or big promotion, or whatever.
I’ve seen a lot of these things happen, so if you feel bad about where your salary is at, take it with a grain of salt. Not saying everybody does this, but I think it happens enough to be wary of.
I joke with friends/family about this. I don't care what so-and-so says they are making, show me their last 5 years tax returns, and we’ll see what they really make.