What is the Cost of Imposter Syndrome?

What is the Cost of Imposter Syndrome?

Imposter syndrome affects over 70% of high-achievers, either periodically or chronically.

It creates stress, distraction, inefficiency, holds people back and drains their energy.

It’s a significant problem, but how significant?

How do you measure the cost of your focus, time, health and energy?

I decided to explore the monetary cost of imposter syndrome. Not because money is most important, but it’s one way of measuring or keeping score for significant issues.

Imposter syndrome is the secret feeling of self-doubt and that you’re a fraud, when you’re not. And the fear of being found out.

Imposter syndrome affects you physically; tension, anxiety, poor sleep and chronic health conditions.

It affects you mentally; it’s distracting, can give you brain fog, make poor and/or slow decisions and second-guess yourself. Plus self-criticism that drags you down emotionally and lessens your enthusiasm and motivation.

All very real, impactful and awfully difficult to quantify.

Imposter syndrome also drives (in a slightly out-of-control sense) 10 characteristic behaviour patterns. These include avoiding new roles or promotions, quitting your job, career or sector, and pushing yourself through the stress and overwhelm leading to burnout.

However, we can quantify the impact on career. It seems like imposter syndrome could be a £100k problem. Let’s see.

The Cost in your Past

If you map out your career, when you got promotions or took a new position, you may see the influence of these imposter syndrome behaviours.

Above is one CEO’s basic salary earnings over the course of their 35-year career to date. It is simplified, only measuring earnings with each promotion or new role. We’ll explore how imposter syndrome can affect this career path.

Avoiding/delaying new roles

Say you had delayed going for a promotion that you were capable of (or you turned it down) that had a £12k pay increase. This would have effectively lost you £24k over the two years you delayed this move.

However, it would have also delayed your next promotion by those same two years.

In our earnings graph above, they had a 2-year delay in going from manager to senior manager. This one delay would down the career path, assuming an identical promotion path.

They would become CEO at 43, two years later.

Their total earnings for the 35 years of their career so far would be £2.95M vs £3.2M.

A two-year delay in going for one promotion, due to imposter syndrome, would cost them £205k in lost earnings.

If you habitually deferred promotions then your whole career path is slower than your true capability, and the lost potential earnings becomes greater as you move to more senior roles.

What if you had a two-year delay in every major new role?

Using the exact same promotion pattern but with a 2-year delay before each new role, they become CEO at age 55, not 41. And the difference in earnings over 35 years is £3.2M – £2.08M = £1.12M.

This shows how imposter syndrome could impact your career by slowing it down.

Similarly, even one sideways move, rather than promotion, can have a cumulative cost.

Not Negotiating Salary

One client of mine didn’t negotiate her salary package when she accepted a COO role in a new company. Her imposter syndrome self-doubt made her unwilling to negotiate, just in case the company changed their mind. She didn’t feel quite good enough and felt negotiating would ’tip them off that they’d made a mistake.’

She later found that there was an extra £30k p.a. in the budget for hiring her, and she stayed with the company for 6 years. An effective loss of £180k.

Plus her next role had her previous salary as a benchmark, again £30k light and adding up fast.

An executive recruiter told me that about 20% of senior executives do not negotiate their remuneration when they change companies.

Quitting or Changing Sector

Some people with imposter syndrome get so overwhelmed, discouraged and exhausted by the relentless self-criticism and doubt that they think the problem is they are not cut out for this job or industry. They mistakenly believe that the imposter syndrome is their own personal flaw. So maybe a change of job would make the imposter syndrome go away. (Which it doesn’t)

Quitting a job can easily cost you 3-6 months salary as you find a new position. This means £30k to £65k for the average for-profit CEO, plus a loss of bonuses or profit-share. Plus the slow down in your career. This can easily cost £100k.

Changing industry can mean taking a little step down from your previous earnings as you lose the financial benefit of your established industry experience. Just like the two-year delay in our graphs earlier, this can cost over £200k.

Pushing Through

Some people with imposter syndrome have not delayed promotions. Instead, they have pushed through with perfectionism, over-preparing and over-working.

The imposter syndrome driver here is that they don’t feel quite good enough, despite massive success, so they continually push themselves and don’t get enough rest. The stress, worry and intensity of this work pattern leads to exhaustion.

This can lead to burnout, which can be 3-6 months off work. And ironically it still leads to a delay in getting the next promotion. Burnout can also lead to people quitting a successful career, changing sectors or leaving the corporate world entirely.

Consultants and Imposter Syndrome

Some corporate executives are driven to become independent consultants due to their imposter syndrome. They think moving out of corporate altogether will solve the imposter feelings.

However, it shows up in their new position as underpricing their proposals, or not putting forward proposals in the first place.

One client had not quoted for £100k of proposals per year for 3 years because of his imposter syndrome. His total loss of earnings was £300k which he could directly attribute to imposter syndrome.

Actual Loss of Income

So far we’ve looked at the effective loss of earnings by not seizing opportunities. Imposter syndrome can also drive you to pay out money you’ve already earned.

Divorce

The worry, distraction and over-work typical of imposter syndrome puts a huge strain on personal relationships. More than one client of mine has attributed their divorce to the imposter syndrome symptoms.

Particularly procrastination and distraction making the hours worked extreme and the inability to switch off and be fully present for the family.

Typically the financial cost of divorce is 50% of your net worth, obviously well over £100k at the executive level. Although it varies so much, I won’t attempt to generalise here.

Qualifications

Another imposter syndrome pattern can be never feeling like you have enough qualifications – as a way to prove to yourself that you’re good enough.

I’ve had several clients who have done MBAs specifically to counter that imposter syndrome feeling of not being quite good enough. Sixty per cent of MBA students are self-funded.

Executive MBAs range from £12k – £75k in the UK.

Yale University charges approximately £150k for its two-year Exec MBA programme.

Although there are many good other reasons for getting an MBA, using it to fight the imposter syndrome feelings doesn’t work.

Future Loss of Income

This loss of potential income applies equally going forwards in your career. How many years are left until you retire? Lost or missed opportunities, slower career progression and sideways moves will all have a cumulative effect over the years of your career.

A £100k cost for imposter syndrome is a rather conservative estimate! For chronic imposter syndrome in high-achievers, the cost is easily £1M over the course of your career.

The most important point about this article is this: imposter syndrome is not ‘the cost of doing business’ or the price of a high-achieving career.

Imposter syndrome is not you (so it’s not inevitable) and you can completely eliminate it with the right approach.

Imposter syndrome is completely unnecessary stress, suffering and yes significant financial cost and you can do something about it.

Originally published in the LinkedIn newsletter  The High-Performance Executive by Tara Halliday