3415: [Part 1] What Are The Costs Of Working? by Marjolein Dilven of Radical FIRE on Hidden Work Expenses

Summary

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Episode Overview

Episode: 3415 – "What Are The Costs Of Working? (Part 1)"
Host: Diania Merriam
Guest Blogger: Marjolein Dilven (article from Radical FIRE)
Release Date: January 8, 2026

This episode of Optimal Finance Daily explores the often-overlooked costs associated with having a traditional job, beyond what you see on your pay stub. By narrating Marjolein Dilven's insightful article, Diania Merriam shines a light on the hidden and indirect expenses of employment—like commuting, wardrobe, and taxes—and sparks a discussion about how much you truly take home. The episode prompts listeners to rethink the true price of working and consider how these costs might shift if you retire, work remotely, or change your lifestyle.

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Key Discussion Points & Insights

1. The Hidden Costs of Working (02:00)

• Premise: People typically focus on work as a source of income, overlooking the money they spend simply to maintain their jobs.
• Perspective Shift: When planning for retirement, individuals fear higher expenses due to increased free time, but seldom consider how many costs vanish when work disappears.

Notable Quote:

“You're probably spending more money on work than you realize. When you think about it, you're spending plenty of money to go to work.”
— Marjolein Dilven (02:10)

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2. Commuting and Transportation (02:30–04:40)

• Direct Expenses:
  • Car: Gas, depreciation, taxes, and lease payments.
  • Public Transport: Monthly passes, occasional tickets.
  • Bicycle: Cost amortized over time.
• Personal Example: Marjolein describes driving a leased car to work, with gasoline reimbursed but monthly car-related taxes (~€180 vs. €33 for a weekend train card).
• Alternative Savings: Working remotely removes the need for a car; switching to public transportation or a more fuel-efficient (or electric) car can yield savings.
• Flexibility: Personal preferences and conveniences—like comfort with a car—can influence whether and when to make these changes.

Notable Quote:

“I wouldn't drive a car if it weren't for my work, meaning that I would take public transport instead to visit my friends.”
— Marjolein Dilven (03:19)

“That's the money I pay for having the convenience of the car. I can lower this… One way would be to work remotely...”
— Marjolein Dilven (03:40)

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3. Professional Wardrobe Expenses (04:45–05:50)

• Dress Code Costs: Upkeep of a "professional" wardrobe often adds hundreds or thousands per year to work-related expenses.
• Variation by Job: Some people can wear casual clothes, reducing cost; office workers often spend more.
• Personal Habit: Marjolein attempts a "clothing ban," minimizing new purchases and relying on existing clothes, but still cites occasional necessary purchases for work.
• Temptation: Despite the stereotype of successful people wearing the same outfit daily, the urge to refresh your attire remains strong under workplace norms.

Notable Quote:

“We all know that successful people wear the same clothes every day, it's still tempting to update your professional wardrobe regularly.”
— Marjolein Dilven (05:15)

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4. Taxes: The Most Direct Cost of Working (05:58–06:50)

• Tax Structure (Netherlands): Higher income means higher tax rates, with each additional euro taxed more steeply.
• Strategies to Reduce Tax Burden: Invest in retirement accounts, optimize deductions, or adjust declarations for minor annual savings.
• Retirement Impact: Taxes diminish significantly when you stop working, increasing your actual spendable income.
• Personal Attitude: Despite the expense, Marjolein values the benefits that taxes fund, taking a positive view of their trade-offs.

Notable Quote:

“To be honest, I enjoy paying taxes as we have many benefits in return.”
— Marjolein Dilven (06:46)

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Host Reflection & Contemporary Context (09:08)

• Modern Shifts: Diania Merriam cites the example of someone saving $6,000 in six months due to pandemic-era work-from-home arrangements, avoiding commute, lunches, business attire, and post-work socializing—a vivid reminder of hidden work costs.
• Work Paradigm Shift: Increased awareness, paired with inflation pressures, is leading people to reconsider the real economics of employment.
• Teaser: Part two will continue unpacking these themes.

Notable Quote:

“Working isn't just about making money. In many ways, it also costs you money.”
— Diania Merriam (09:25)

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Memorable Moments & Timestamps

• 02:10 – Marjolein frames the central question: What are you really earning after subtracting “costs of working”?
• 03:19 – Her personal commuting breakdown (car taxes vs. public transport costs).
• 04:45 – Discussion of “dressing for success” and the temptation of new work clothes.
• 06:46 – Her uncommonly positive attitude on taxes.
• 09:08 – Host’s anecdote about remote work savings, summarizing the episode’s message.

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Tone and Style

• Practical and Reflective: The tone is relatable, conversational, and pragmatic. Both Diania and Marjolein use personal anecdotes and simple language to connect abstract financial concepts to real-life decisions.
• Encouraging and Informative: The episode encourages listeners to reassess their current work-related spending without judgment, fostering a habit of financial mindfulness.

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Conclusion & Next Steps

This episode challenges listeners to look beyond the paycheck and see the real “net” cost of working, using both numbers and lived experiences to illustrate the case. Listeners are invited to tune in to Part 2 for further exploration of indirect and lifestyle-related work expenses, gaining more tools for intentional money management and perhaps, steps closer to financial independence.

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Stay tuned for Part 2, where your optimal life awaits!

Transcript

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This is Optimal Finance Daily what are the Costs of Working? Part 1 by Marilyn Dilven of RadicalFire.com when thinking about spending in early retirement, people think automatically they'll spend more. There's more free time, which you'll now spend doing things instead of working. That said, people often forget that they're also spending money to work. What are the costs of working? You're probably spending more money on work than you realize. When you think about it, you're spending plenty of money to go to work. Imagine if you retired. You didn't have to have that extra car, those fancy clothes, eat those lunches. In this article, we'll dive into some of the direct and indirect costs of having a job. When you know how much you spend on that, you'll have a better overview of what paycheck you're actually taking home. Know that while there'll be a focus on the financial costs of working, there are also other factors that come into play. Things like job satisfaction, colleagues and time spent all count. Let's dive straight into the article. What are the costs of working? Going to and from work? You have to go to work and return home every day. That leads to transportation costs if you're taking your car to work, you need to take into account the gas you're using plus the depreciation on the car. If you wouldn't have this car if you weren't working, you can take the entire value of the car into account. When you're biking, you can take the cost of your bike on a monthly or yearly basis. When you're going by public transport, it's simply the amount that you spend on going to and from work. Personally, I drive my car to work.

[A]

I have a leased car, so the.

[E]

Amount of kilometers I drive is irrelevant. Since my company pays gasoline for me, the fixed costs I have every month are additional taxes that I have to pay on top of my income taxes. I wouldn't drive a car if it weren't for my work, meaning that I would take public transport instead to visit my friends. I'm paying now around €180 every month on taxes. Otherwise, I would pay €33 on a weekend train card. What I'm now doing with my car, meaning that I can pay €146 every month to go to work. That's the money I pay for having the convenience of the car. I can lower this. One way would be to work remotely, meaning that I don't need my car to drive to clients. Another way would be to not drive my car for private purposes, meaning that I don't have to pay the additional taxes. While I could do that, I'm quite used to my car now. When I can drive a car for cheap, why not take the opportunity? Perhaps I'll do it sometime in the future. But for now it's not necessary for me personally. If you have your own private car that you use to drive to work, there are even more things you can do. You can buy a more fuel efficient car, especially if you're driving a significant distance to and from work. This can give you some additional savings. You can even go for an electric car, which is becoming more and more efficient. When public transportation is a cheaper option for you, you can switch from a car to public transport. Dress for success. We all know the expression dress for success, right? Well, dressing for success also costs us a significant amount of money each month. Depending on your lifestyle and work, you can spend a lot of money on having a professional wardrobe for work. You can spend thousands of euros every year keeping your wardrobe up to date. While we all know that successful people wear the same clothes every day, it's still tempting to update your professional wardrobe regularly. But there are lucky people who can wear the same clothes to work as they're wearing when they stay home. When you're one of those people, it probably doesn't cost a lot to dress for work. On the other hand, people who have an office job are expected to look professional and they might spend more. I know that I would love to wear my sweatshirts to work every day, but sadly that wouldn't be appreciated. When I started working, I bought a few new pants and that's it. I already had some shirts, so that's what I'm dressing with right now. I started a clothing ban last year, meaning I won't buy any new clothing for as long as possible. This year I haven't spent any money on dressing for success. Last year I bought two new pairs of shoes and three new pairs of pants for work.

[A]

That's about it.

[E]

Taxes Taxes are the most boring and the most direct cost of working. The more you earn, the more taxes you owe. In the Netherlands, the higher your salary, the higher you're scaled in the different tax brackets, meaning that if you earn more, every extra euro is taxed more than your average tax rate. What you can do about that is invest in tax deductible accounts that save money for when you retire. Another way to lower this is to optimize your tax declaration. Most of the time you can move around your money a bit, which can save you anywhere from 10 to €100 on a yearly basis. When you stop working, most of the taxes will go away. You'll pay fewer taxes in retirement for sure. To be honest, I enjoy paying taxes as we have many benefits in return. To be continued. You just listened to part one of the post titled what are the Costs of Working? By Marilyn Dilven of radicalfire.com One of.

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Worth the exercise to truly calculate the cost of working. I recently read about a woman who was able to pad her emergency fund with $6,000 in just six months because work from home saved her money on transportation, takeout, lunches, business attire and happy hour drinks. Pair a break from these costs with the current rate of inflation and I can see why many workers are now realizing that working isn't just about making money. In many ways, it also costs you money. That'll do it for today. I'll finish the rest of this article for you tomorrow, so be sure to come back for part two where your optimal life awaits.