Having turned 50 recently, I realized that I have finally mastered some major lessons from the school of real life. I thought I would use the excuse of my birthday to pass on some of these lessons to younger generations. While I enjoy pretending to be a fountain of wisdom, in reality, like most bloggers, any wisdom I have achieved is likely more the result of successful marketing than anything else is.
Today I am starting an occasional series of entries in a “Real Life 101” series. Maybe you can find these on Motley Fool or in a Dummies Book, but here you can get them free. These strategies have been tried, tested and proven true in the sphere of real life. Unlike a stock market investment, where you earnings are never guaranteed, these principles will work. They have been painfully acquired from navigating through real life for five decades and in many cases through making the wrong choices. They are not always easy to implement, but life never is.
Today’s topic: job basics.
Unless you happen to have inherited a large estate, the most important factor in avoiding misery is a good, steady and well paying job. Ideally, the job will be one that you will also enjoy. While there is no lack of jobs out there, few of them meet all these criteria. Most likely, you do not have one of these jobs. Here are some strategies that will get you there.
When it comes to any job, consistently going beyond the expected almost always reaps rewards. I am amazed by how many workers cannot seem to grasp this basic truth, even after their fourth or fifth job. Strive to be exceptional in whatever you are doing, no matter how menial or mundane. In the unlikely event that your efforts are not noticed in your current job, your attitude will be noticed by some future employer. Save the snarkiness for when you get home. When you are at work, focus on your work. Be the first to volunteer to do difficult or not so glamorous work. Unless your chain of command is full of pointy haired bosses, most likely your work attitude will be quickly noticed, and you will be given more challenging and interesting work as a reward. It is quite possible that you will earn a promotion and/or more money too. Having demonstrated your value you are much less likely to be pink slipped or downsized.
Constantly steer toward jobs that offer the three critical factors: steady employment, good wages and benefits. While I generally do not like debt, I have gladly gone into debt so that I could compete for better paying jobs that advanced my career. Be hard nosed. For example, it is better to go into debt to get a degree than a certification. It might seem a worthy goal to be a Microsoft Certified Software Engineer, for example. Nevertheless, certifications have a limited shelf life. A degree in software engineering though will carry the broad education that you will likely be able to apply for the rest of your career.
Few things have the potential to be more personally catastrophic than unemployment. This means that you should always do your best to avoid being fired or laid off. Regardless, you will probably get a few periods of unemployment in your career. If it happens to you, expect to feel devastated, but do not think that you are unique. Unemployment happens. You will recover from the experience and reemerge on your feet. In most cases, you can anticipate your termination. If you sense that you are likely to lose your job then take action. Start aggressively looking for your next job. Rats know when to desert a sinking ship. So should you.
Another rule of thumb: the best job for you will likely not come from a newspaper or an internet jobs site. It will come through a referral from someone you know. You would probably not pick a doctor out of the phone book. Instead, you will get recommendations from friends. The same applies doubly with jobs. People’s actual experience with employers will tell you a lot. After all, you do not want to waste your time dealing with the trauma of a job that does not fit you. Consequently, you need to develop networking skills.
Recently a contractor I have not worked with in seven years sought me out. We kept in touch and traded occasional emails and holiday cards. We would meet for lunch every year or two when our schedules allowed, which they usually did not. She was interested in applying for a job and wanted to know if I knew anyone who worked at the place where she was applying. It just so happened that yes I did know and worked rather extensively with someone who worked there. Although it had been several years, I contacted the man I used to work with, who I considered part of my own personal network. He gave the background on the culture of the place and what they were likely looking for. It sounded like a good match for her. She has applied for the job and will use me as a reference. I suspect that if she is interviewed she will do well. In addition to having the skills, she will have an understanding of the culture of the place to carry into the interview. We all know people with whom we can network. It could be your friend, a neighbor, a coworker’s spouse, or someone you know at church. By marketing yourself to these people, you are actually marketing yourself to a larger number of people, and they will likely keep you in mind and let you know of opportunities. Make networking a habit and if you are in the position to return the favor, do it.
Since unemployment will visit most of us at least a couple times in our life, devise a proactive approach so you can be prepared when it strikes. If you are chronically low on cash, your backup strategy might be to move back in with your parents for a time. (Please check with them first to make sure they will agree.) Putting your expenses on a credit card is the wrong way to go, so strive to create a nest egg that will play for at least three months of expenses. The current trend, unfortunately, is that while unemployment is happening less often, when it does happen it lasts for longer periods. Most experts are now recommending saving six months of expenses to emerge from unemployment financially intact. Whatever your strategy is, you must be realistic about it. Even if it is to live off your credit cards, you will still need income to make those monthly payments. This means that while being unemployed you will likely have to be underemployed by doing some work that you would normally consider beneath you.
Your first jobs are likely to offer little in the way of benefits. If you are young you may be able to go without health insurance for a while, but it is always risky. Benefits should be a primary consideration for accepting any job. Health insurance in particular is a crucial factor. Granted, the job has to pay enough so that you can afford the health insurance premiums, but you should make it your goal to find a job that offers health insurance benefits.
Another way to judge an employer is to find out how much money, if any, they will contribute toward your retirement. Many small employers simply cannot afford to contribute to a 401-K plan, but will let you contribute your own money into a plan. Others cannot be bothered. A decent employer will match your contributions to at least three percent of salary. An ideal employer would double this amount. If you can find an employer that also provides a traditional pension that would be nirvana, but it is not realistic anymore. If you want this degree of protection, look toward state, county or federal employment.
Of course, if you get benefits like these do your damnedest to take advantage of them as soon as possible. Health insurance is most important, since any condition you may have or develop can leave you financially devastated. Otherwise contribute to the 401-K as much as you possibly can. You will pay less in the way of taxes and, of course, the sooner you start, the more you will reap when you retire. You may not believe that the money will actually be there when you retire. Do not be stupid. You too will age and if you are lucky, you will live to see your retirement. You will not want to eat dog food in your retirement. While social security may be problematical, your 401-K will generally be invested in commercial stocks and bonds. Our financial system has shown extreme resiliency. Even the Great Depression did not wipe out the stock markets. Invest early, invest regularly and invest until it hurts.
More job and career advice will follow in subsequent entries in this series.