To achieve long term career-related freedom, happiness, success and peace of mind, your first important goal is accumulate wealth. If you haven’t already started, it’s not too late and I’ll help you start right now.
Allow me to jump into an example to illustrate my thesis. I regularly speak with experienced professionals, in which the conversation goes something like this:
“Hey, Jack, I would love to try something new. I’ve been doing the same work for the last 20 years and desperately need a change. While I like what I do and the firm appreciates my work, I have this uncomfortable sense that something is missing. There’s a little bit of emptiness, hamster-on-the-wheel, and Groundhog Day (the movie with Bill Murray) feel to my life. Maybe I could pivot from an investment banking job to a tech start-up or some other cool venture to reinvent and reinvigorate myself? I’m scared that if I don’t do something now, I’ll be too old and too set in my ways and career to make a meaningful change.”
Okay, that makes perfect sense so far. It is common and normal to have a nice well-paying job with a respectable company, but still feel that you are not living up to your full potential. Whether you have 20 years or only three to five years of experience doing a particular job, who doesn’t already feel burnt-out and bored? Who doesn’t dream of living their best possible life?
I will then ask the job seeker about their compensation requirements since this data is crucial when switching jobs or attempting to move into different areas outside your core competencies and expertise. While a new law prevents me from asking about their salary, most people tend to tell me, especially those who earn a nice living. The person will say, “I am earning about 500k all-in, and I’m open with regards to compensation.” I have heard this enough times that I already know how the conversation will go.
Me: Great, I have a FinTech start-up that is a perfect fit. Since they are pre-IPO, the company can’t match your salary, but could offer stock and options, which could turn into a fortune if the company hits it big. What do you think?
Candidate: Sound great, how much will they pay on the base?
Me: About $150k, but with long-term stock options and other incentives, it could potentially skyrocket to up to over one million.
Candidate: Oh, I can’t take $150k
Me: I thought you said you were open?
Candidate: I am.
Me: Well, if I had a job that paid a package of 200k would that work?
Candidate: No, are you deaf and stupid?
Me: Yes, but that’s beside the point. You said that you are open; can you clarify?
Candidate: When I said open, I meant that I would accept something in the neighborhood of $480k or $490k
Me: Huh, that doesn’t sound very open to me. It’s only a shade under where you are now.
Candidate: Well, I’d like to be able to take that chance with a start-up, but I have to consider my monthly nut (anyone under thirty that is old guy talk for how much you have to pay in expenses each month just to break even). I have a mortgage and real estate taxes on my home of over $25k per year, my wife’s and my BMW and Audi, as well as the kids’ cars, along with insurance, goes for about $3k per month. The kids’ private school tuition is about $30k large, I’m putting away some money for my retirement. Need to put money into the children’s’ 529 College plan…
The list of expenses keeps going on, and on, and on.
Me: I understand. You need a certain set income to maintain your lifestyle, and whatever is left over, to put a little amount away for your retirement and college funds. I’m sorry, I get it now. So, unfortunately, forces dictate that you can’t be that open with your compensation requirements?
Candidate: Yea, I guess not.
The great thing about having over 20 years of executive recruiting experience is that I’m not making this shit up. I can afford to be a mediocre writer, since I have a wealth of first-hand experience. This enables me to convey real-life situations with you, and then help you learn and benefit from my experiences.
If the candidate in question had enough money saved away and kept his expenses down, he could have went for the job. Who knows what would have happened next. The Fintech company was in the bitcoin space, and they would have given him bonuses in bitcoin. A modest amount would have made him a multi-millionaire. In case you’re wondering, no I didn’t get paid in bitcoin, and I’m miserable and hate myself for not pushing for it. In my defense, however, I partly blame all the Compliance and Legal people I’ve spoken with, regarding cryptocurrencies. They all told me that it is the Wild West populated by scammy types of people of questionable repute, and to avoid this investment. Thanks guys for the great investment advice!
Anyway, now that I got that out of my system, back to my main point. If you truly want to have career options, you must have sufficient funds to permit you the luxury of pursuing your passion. It doesn’t have to be a fortune, rather just enough so you can take a job that you love, or switch careers and not worry about meeting your expenses. If you don’t have the financial cushion you will be trapped in your job. If it is well paying, it may be a gilded cage. To be fair, for the majority of the people I work with, nobody is going to hold a charity for those who are earning $150k to $500k. No matter what level you are at, it is still frustrating to feel stuck in a type of job that you can’t get out of because you can’t make the same amount of money doing something else that would make you happy and fulfilled.
Here is what you need to do to accumulate FU money. Be prepared, you are not going to like my austerity plan. If you are a young person reading this (believe it or not, I have thousands of followers on Tumblr), do not take on an enormous amount of debt to pay for a college degree in an area that won’t get you a reasonably paying job. I’m sure you are interested in gender and race studies of Medieval Latvian villages, but nobody will pay you for that knowledge, or, at least, compensate you enough to cover the $200k plus debt from going to Amherst College.
Once you start working, live at home to save money. Yes, you will get made fun of, but screw everyone else. Why should you shell out tens of thousands of dollars in rent, and after five years you have nothing tangible to show for it? Instead, with the money saved, invest it in a diversified portfolio of ETFs. They are low cost, match the major US and internationial benchmarks, and you will do better in the long run than all the Jim Cramer buy, buy, buy, sell, sell, and sell traders. Put money into your retirement accounts as they grow tax deferred, and they add up quickly.
As you get older don’t fall into the keeping-up with the Joneses trap. Avoid buying big houses, flashy cars, or taking over-the-top vacations just to post on Facebook and Instagram to impress people you don’t know, and who couldn’t care less about you. Save the money instead, and one day post pictures of the receipts detailing your big ATM balances.
Once you build –up a nice nest egg, then you will have freedom. By deferring immediate gratification, you will reap the benefits and rewards in the long-term. It will be tough going until then, but it will pay off. Your future self will thank you for your thrifty efforts and monastic existence while you were younger. This course of actions gives you the gift of freedom to make career decisions solely based on what’s right for you.
Also, you won’t have to make bad career choices based upon intense pressure to figure out how to pay off your always-looming college tuition debt, rent, and ballooning credit card bills.
Yes, it’s that easy.
*Since this is a family PG rated publication, I used ‘FU money’ instead of the commonly known and crass term “F*ck You Money.” This is the amount of money you need to accumulate to live life on your own terms.