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My Most Important Piece Of Advice To New (and old) Sales Reps

I see more new people coming into this site posting about how to get started, what they should do etc. That is all great, and would have been really nice early-on, so I thought I would share advice that everyone should have heard at the beginning.


Please add your own advice in the comments, and as always, feel free to tear mine apart.


ADVICE:


Live off of your base salary and forget that you ever make commission. When you move up positions, your lifestyle can change based off of the salary increase that you get, but never get stuck in the trap of chasing commissions to pay bills. I see it all of the time!


There are three different types of people that I have seen in my career.


The Flashy Spenders:

These guys and gals spend everything that they make. I have seen several reps who make 3x what they did 3 years prior and have no more money in their accounts. They still can't afford a down payment on a house, and they are always talking about when the payday comes that includes commission. This guy always dresses in new clothes, always goes out to dinner, lives in an expensive apartment and drives a new car. These guys see huge lifestyle swings in their career, and jump ships more than the regular sales person. This life is fun sometimes, but sucks royalty long-term. You need an exit strategy and this is not it.


The Upper Middle Class Dad:

This guy does not spend all of his money. He is fully vested in the 401k, goes to all of the happy hours, but uses free drink tickets. He has 3 nice revolving outfits. Lives in a nice house drives a nice car, and takes care of his family. Sometimes this guy will splurge on a trendy stock that he will hold for a while. This guy will be in sales for the rest of his life. Will probably be a Director, but never a VP. He will stay at the same company for longer periods of time, because downswings in the market hurt, but it doesn't affect his lifestyle. Being this guy is pretty good and a good way to live as a salesman. This guy will retire setup to take care of himself and not have to worry too much on his fixed budget.


Rich Dad Poor Dad Sales Guy:

To be this guy, you should read the book Rich Dad, Poor Dad. This is the guy that I have tried to be. It is by far the less stressful and the most fruit-full. I have worked with a couple of these guys and have a good friend who is also one of these guys. In sales you have the opportunity to become independently wealthy in a short time period. This guy lives off of his salary and invests the rest in other areas that give him a return. The guys that I know own several rental properties that produce income every month. My buddy is 39 years old and owns over 20 rental properties. All of which were purchased by making a down payment or cash from commission that he didn't need to pay his bills. He has never made more than $200k, but after 14 years in sales is worth over $5M. He still works as a sales rep selling a CRM, but has two full-time employees doing property maintenance, and owns a clothing store that has several other employees. There is been no difference in income from this guy and the first guy from sales. But this guy can walk away at anytime and retire, while the first guy will live the rest of his life stressed and probably divorced.


There is a huge opportunity in sales to set yourself up for the rest of your life. The only person that you need to impress is the person that files your taxes, because at the end of the day the rest will only dig you a hole and squander the opportunity that you never knew you were going to have. Good luck, and I hope to see you in early retirement!

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28
poweredbycaffeine
WR Lieutenant
+10
Bean Juice Drinker | Sales Savant
I'd rather be the Upper Middle-Class Dad than RDPD...but I've been a VP.
Sunbunny31
Politicker
+5
Sales Executive
Same.Β  Β There's a lot of work involved in managing properties, even if you have "people".Β  It's another job in itself.Β  Β To each his or her own.
poweredbycaffeine
WR Lieutenant
+10
Bean Juice Drinker | Sales Savant
My lifestyle is pretty dialed; I don't need to worry about managing employees or hiring managers for those businesses.
Show 2 more replies
TheNegotiator
Politicker
+7
VP of Sales
Why not both?
.
I make enough on base to live extremely comfortably. I literally do whatever the fuck I want. Eat, buy, go wherever the fuck I want. I still have money to put away/invest, which I do. And then I make commission, which I also invest.
.
I’m gonna buy a nice watch for my bday which is mid next year. That’ll be the first unnecessary, real-high ticket purchase I’ve made, ever.
.
Everything else has been sub $1,500 literally my whole life, and frequently has an element of practicality to it that lets me justify the investment.
.
IMHO, do whatever you want with your money.
.
When I made 50-60k a year, I could’ve lived like a miser and put money away, but it wasn’t worth it. Live your life. Enjoy. But, develop yourself. Your personal growth will be reflected in your income 10X
.
Once you make 300k+ it’s a lot easier to stack cash and assets. They actually accumulate hilariously fast.
Mo
MonthEndSpecial
Valued Contributor
+3
Enterprise Account Executive
Sounds like you are doing well and that's what matters. You could be driving a lambo on that income. That is the trap I am trying to save the newbs from falling into.
harebrained
Valued Contributor
+5
Enterprise Account Executive
@monthendspecial totally agree - I work with a lot of flashy guys and make 300k+ and I do what I want but my lifestyle is nowhere near inflated to spend it all so pretty much on an auto pilot of investing and planning to work to 45 yrs old or so. Somewhere between RDPD and Middle class dad = Kid free 30something chick?
Show 1 more replies
UrAssIsSaaS
Politicker
+8
SaaS Eater
Im pretty firmly in the Upper Middle Class world and pretty damn happy with it. I live where I want, have the toys that make me happy and am still able to invest and save for retirement.

Its enough work leading an org in my day to day, I dont need to also have to manage people responsible for my shit on top of that. To each his own though and I think we can all agree, dont be #1.Β 
Mo
MonthEndSpecial
Valued Contributor
+3
Enterprise Account Executive
Totally agree!
Diablo
Politicker
+7
AE
I truly believe in living a good life rather than saving all the bucks. We slog to live a better life, buy things we love, enjoy and be happy. Atleast that drives me to do better. I am not a VP but love having upper Middle class life.
Mo
MonthEndSpecial
Valued Contributor
+3
Enterprise Account Executive
Nothing wrong with that! The point I was hoping to make to newbs was that you have a lot of flexibility with the new money. One thing is certain. Your best days won't last forever although they may come back.

LordOfWar
Big Shot
+12
Director
I'm UMC, but working to be RDPD. With a 3 year old and another on the way all my commission goes to investments for their future and since the wife and I are not spenders I've got a nice amount saved up.

We just got a house this year (well within our means on my base salary, wife is a STAHM) and I'm interviewing for VP positions (currently Director) so I hope to either move up where I am (merger) or elsewhere but I need stability.

I want to be able to retire from the day job by 45, even if I chose not to. I love my industry and selling is still fun, so I don't know how long I'll actually stay.
Filth
Opinionated
+4
Live Filthy or Die Clean
MonthEnd I appreciate your breakdown. Though I never went into sales with the idea of being in category #1, I definitely had a year or two that fit pretty well into the category. I've since been turning into that Dad Sales and love the stability of the planning and mindset and getting into the 9-5 groove. I don't know if I'll ever be #3 but I love the idea of turning my savings into some passive income, but that's down the road - starting a family now so all the money is locked down in the foreseeable future.Β 

The only thing I would add as anyone starts into sales is that 20% of your paycheck like most advice preaches is not enough savings, especially if your single and riding high on the easy money sales can show you. Hide 50% away and if you burn the rest you aren't screwed when some bad months come your way and save your stomach lining.
Mo
MonthEndSpecial
Valued Contributor
+3
Enterprise Account Executive
So true. I have seen guys run to the bank to cash $15k checks, because their bank accounts get zapped if they leave it in there by their creditors.Β 
GDO
Politicker
+7
BDM
on the road to UMCD willing to aim for RDPD. But to be honest, IΒ΄m not in a hurry.
Fo
FormerStartupJobHopper
Big Shot
+7
AE
Amazing post. Shooting for somewhere between rich dad poor dad guy and upper middle class dad. business dads are awesome lol, legit all that I want
Mo
MonthEndSpecial
Valued Contributor
+3
Enterprise Account Executive
:)
Mo
MonthEndSpecial
Valued Contributor
+3
Enterprise Account Executive
I am not doubting that there are many things wrong with that book. Just like anything you read, you should be able to discern what is valuable and what is not. It has worked for many that I know. I am sure there are many who feel the opposite.Β 

I certainly would take the criticism from someone who is selling competing books with a grain of salt.
Kamran
Mortgage Broker
I am all about that rich dad poor dad sales can earn you a great living but investments build you long term wealth
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