Why the '$70K' CEO Is Cool With Losing His $1M Salary

Dan Price says his life is pretty simple
By Evann Gastaldo,  Newser Staff
Posted Apr 16, 2015 8:24 AM CDT
Cary Chin, left, is seen through a sign on the glass door of Gravity Payments, a credit card payment processor based in Seattle, as she works on Wednesday, April 15, 2015.   (AP Photo/Ted S. Warren)
camera-icon View 1 more image

(Newser) – Gravity Payments CEO Dan Price has been lauded since news broke that he's gradually raising the minimum salary for his company's employees to $70,000—but what will it be like for Price to live on $70,000? That's what he, too, will be making, down from about $1 million a year, until the company's profits surpass the level they were at last year, before the raises went into effect. "I haven't even thought about that at all, too much," he tells ABC News. "My life started pretty simple, in a lot of ways. I don't have a lot of financial obligations or debts." He owns a "nice" three-bedroom home and has been driving his Audi for 12 years. "I may have to scale back a little bit, but nothing I'm not willing to do," the 30-year-old says. "I'm single. I just have a dog."

Not that he doesn't enjoy the finer things in life: He has lots of rich friends, and he often gets invited onto their yachts or private planes, he says: "I have an incredibly luxurious life, for some reason, but I don't end up paying for a lot of it." He adds that he wasn't making $1 million "because I need that much to live, but that's what it would cost to replace me as a CEO." And that in itself is a problem, he notes: "I think CEO pay is way out of whack. ... I'm a big believer in less: The more you have, sometimes the more complicated your life gets." But will Price's move become a trend? Likely not, experts tell MainStreet, ABC News, and CBS News. "It just doesn't make economic sense for really large companies that have a lot of people like that to give huge raises like this," explains a labor economist. "It can tip them from being profitable to being unprofitable."

My Take on This Story
Show results without voting  |