There’s a lot in the news right now about the economy – inflation, record high gas prices, recession. Many professionals are feeling worried about money, despite having relatively good salaries. The anxieties are both short-term and long-term. In the short-term, higher prices make it seem harder to save. For the long-term, it’s hard to know where to invest those savings: stock market? Real estate? Something else?
I have a strong opinion about this. Without question, the absolute best thing you can do with your money is to invest in yourself.
This has been proven in my own life over and over. Hands down, every time I’ve invested in myself, it has paid off, whether that was getting my MBA, investing in a coach, or building new skills. Each one of these was a “big gulp” expense – but every single one has allowed me to provide more value, earn more money and take my career to the next level.
I’m a bit of a geek when it comes to money and investing. With a Wharton MBA in finance, I think in terms of fiscal tradeoffs. So let’s play with some numbers, to see how investing in your career can bring unparalleled returns. Watch the video below or read the text that follows to learn more.
Let’s say you were to invest $5,000 today in financial instruments. A balanced portfolio blending stocks, bonds and cash would probably earn something like an 8% annual return. At that rate, over the next 30 years, that $5,000 would make around $50,000. That’s a nice amount of money.
But let’s say instead, that you invested that $5,000 in a career coach who helped you earn a promotion. If that promotion came with a very modest pay raise of just $10,000, the investment will have more than paid for itself. More importantly, over 30 years, that extra $10,000 in your paycheck would translate into $300,000 – and that’s not including future promotions and pay raises that would certainly follow.
Even if you weren’t planning to work for another 30 years, the pay raise would surpass the 8% investment in just 5 years.
That’s what I mean when I say that investing in yourself is the best choice you can make with your money right now.
If you’re like most professionals, chances are you could invest in a coach without a huge sacrifice. In 2020 the U.S. Bureau of Labor Statistics put out a report on discretionary spending in the U.S. Discretionary spending is what people do with the money that’s left over after housing, utilities, commuting, etc. According to that report, the average person making $100,000 is spending:
- $12,000 on dining and entertainment
- $3,000 on clothing and jewelry
- $3,400 on electronics, toys, and hobbies
That’s a total of $18,000 – 19,000.
Of course, eating out, entertainment, hobbies, and clothes are fun, and it’s important to have fun. Who doesn’t love a new outfit, or a concert, or a new gadget? But these kinds of expenses don’t generally lead to a long-term shift in your quality of life. Is your new phone that much better than the old one? Did you really need another pair of new shoes or new tie? How often do you really use that kitchen gadget that seemed so cool at the time? Cleaning out your home, you’re bound to find outfits that you barely wore, toys you thought you’d enjoy, but barely used.
When your career isn’t going the way you want it to, the costs are high. Endless bad days at work leave you stressed out at home. Snapping at your partner, impatient with your kids. Comfort eating. Losing sleep. I know for myself, the more stressed out I am, the more I randomly spend money on junk that I don’t really need. Is that retail therapy really creating long-term happiness? Or would I be better off having a session with my coach to solve the underlying issue?
Work-related stress is at the heart of many costly health conditions: high blood pressure, heart disease, digestive problems, sleep dysfunction, diabetes, depression, and anxiety – the list goes on. These chronic conditions have a financial cost, of course, but more important is the toll they take on your quality of life, both now and in the long term.
Here’s another cost comparison. The average trip for a family of four to Disney is about $5,700. Disney is a lot of fun, but the truth is that most kids don’t remember anything that happens in their lives before they’re five years old. They’ll love it in the moment, and you’ll have great pictures and stories to tell them later, but they won’t remember it. For the cost of a single Disney vacation, you could work with a career coach for a few months to make some major shifts in your career – whether that’s finding a new job, landing a promotion in your current organization, or improving your ability to manage your team and your time in your current role. Best of all, when your career is in a good place, your vacations will be better. You won’t be taking them to escape an awful situation, or because you haven’t had a break in forever. You won’t be exhausted, so you won’t have to spend half of your vacation just trying to detox from working so hard. Instead, you’ll be ready to enjoy yourself. You’ll be able to relax, refresh and re-energize so you can get back to doing work you love.
Or consider buying a new car. The average new car price this year is $48,000. That’s nearly 5 to 10 times what it would cost to invest in a coach. And don’t forget – cars start losing value the moment you drive them off the lot. Even the new car smell only lasts a few months. Better to upgrade your career, land that next promotion, and then buy the car you really want.
There’s so much to spend money on in our society, the choices can seem endless. You can go recreational shopping for new clothes and gadgets. Spring for a nice vacation. Get a new car. Put it away in financial instruments. There’s nothing wrong with any of these choices. But none of them come close to the value that you’ll get from investing in yourself and your career – both in terms of the financial return, and in terms of your well-being.
When you’re in a great job, feeling confident and secure, everything is better. Your day-to-day life is interesting and energizing. Instead of getting home exhausted and burned out, you feel good at the end of the day. You’ve done meaningful work with people you respect. Instead of being distracted, you can enjoy your time with family and friends. Less overwhelm means better physical health, too, which has a significant impact on your long-term well-being.
If you’re not where you want to be in your career right now, we want to help – whether you’re:
- Stressed out, overwhelmed, or feeling in over your head at work, or
- Stalled and not getting the promotion you wanted, or
- Looking for your next role, but not getting across the finish line
Book a free call with us right away. We’ll talk with you about your current situation, looking at where you are now and where you want to go in your career. If we can get you there, we’ll let you know and talk with you about what it would look like to work with us. If not, we’ll point you to someone else to help. Either way, you’ll get clarity on what you can do to be more fulfilled, less stressed, and happier in your career.