Not the Usual Career and Financial Advice
For as long as I’ve been reading personal blogs, the key advice you always take away is that to build wealth and financial independence, you have to spend less than you earn (ie SAVE). The is timeless advice.
But there are also lots of folks on the web following the advice of ditching your job, doing your own business, and earning passive income. The advice is given as though being an employee is a plague! Today, I just want to be cheeky and suggest that you do not always have to follow this advice (even if you hate your job or boss!). Here here are some of my goofy thoughts.
Be a civil servant
This advice is not very often given. But in a world where employees now have to take care of their own retirement, the federal government is one of the few employers that still provide pensions. Whether you are a teacher, a police officer, work for the military, this is one of the greatest benefits. Look at it this way, if you are a teacher and you retire with full benefits, you do not need a large account in your IRA (when you rollover from your TIAA account). This advantage is simply huge compared to folks to most of us who have to manage our portfolio (look what happened if you planned to retire in 2009!).
The disadvantage to this strategy is that you have to work till your “retirement age” to be able to get your benefits. But some federal occupations do allow for withdrawal of benefits at a relatively young age. There is also great job security if you work for the federal government though that is beginning to change due to budget deficits.
One good way to diversify a couple’s income is to have one work for the Federal Government and the other having his or her own business or any other career. It will provide the safety net to allow at least one couple to take greater career risk.
Build a successful business
Obviously, this is what most folks strive for. Build a successful business up to a large enough scale so that you get massive cash flow or you could sell the business or IPO it. Not many folks succeed at that level though.
Rise up the corporate ladder
This is something nobody talks about. In the pf blog world (in fact in the whole bloggesphere), every blogger worth their salt is telling everyone to “quit their day job” and “earn passive income”. What most folks do not realize is that folks who are in top management earn more than any of us bloggers (and yes they are corporate folks who have a job and need to answer to their boss). I’m not talking about working for medium size companies. I’m talking about folks who work for fortune 500 companies.
Yes, it is not easy to rise up the ladder. You need to work in the right department. You need a good mentor to advocate for you. You need to perform in your projects. You need to get along with people. You need to be business minded and bottom line oriented. You need to under promise and over deliver. Essentially, to rise up the corporate ladder, you need to have the skills of an entrepreneur as well. But if you have the talent, the financial rewards are huge. These are the folks seeking “financial advisors” to manage their stock options worth millions (whereas us pf bloggers advocate using discount brokers!).
So if you are working in a fortune 500 company, do not get caught in this whole “fire your boss” thing. See if it is worth your while climbing the corporate ladder.
Rise to the top of your profession
What ever profession you are in, rising to the top of your profession almost results in huge financial gains. And the financial rewards at the top dwarf what you earn if you are at the bottom of the pile. The top 10 tennis pros make out like a bandit, while the guy at ATP rank of 40 has to fly coach and stay at cheap hotels when traveling the circuit! Roy Halladay of the Phillies gets $15 million a year while those in the minor leagues earn next to nothing. Like I said before, upper management makes much more money that a regular VP. The programmers at google make six figure salaries. The ordinary folks have to compete with programmers from India!
So before you think of “quitting with grace” to “be an entrepreneur”, ask yourself if you love what you are doing and if you have what it takes to rise to the top. If the answer is yes, work hard at it. If not, then find something that inspires you.
Get into a high paying profession
Getting into a high paying profession makes your road to financial independence easier. If you want to be a historian, don’t expect to be as financially successful as a banker! If you want to be a zoo trainer and that is your passion, do not expect to be better off than those in higher profession.
Look, if there is something you are passionate about and what to do (could be joining a non-profit organization), then go for it. But if you do not know what you want to do, do some research and consider the the earnings potential for the average person in the industry.
And if you do this research before you get into college, it will be even better. If you have $100,000 in student loans and become a zoo trainer, you are going to be worse off than someone with that same student loan but gets a job as a programmer in Microsoft!
I hope this post has made you think about your career, your financial situation and perhaps your next move. But if you are unhappy with your present job, you may be influenced by all these get rich quick, be your own boss, earn passive income fluff that is littering the internet. It might work for some folks, but I suspect that it will not work for most. Rather, figure out what you enjoy doing and really put your heart and soul to it. Most of the time, finance success comes as well if that happens.
Mr Credit Card from www.askmrcreditcard.com gives his views about career and financial advice. He mentions some things that aren’t the kind of advice you’d see in the media.