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March
2005 Knowing
When the Job is a Bad Investment Paycheck Offers One Strategy for Life Balance Michael P. Haubrich, CFP |
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You might
remember that Johnny Paycheck song that goes “…take this job and shove
it. I ain’t
working here no more.” That’s
certainly one approach to ensuring that you establish work/family
balance. In fact, I recently advised a
client to exercise that alternative.
We even rehearsed the words she could use with her employer, but
admittedly they were a little less blunt and a tad bit more diplomatic than
Paycheck’s version. Wait a
minute…isn’t a financial advisor supposed to help you make money, not give it
up? Aren’t we supposed to help our
clients devise a plan to meet their long-term objectives? Yes and yes, so why
would I even suggest people give up their jobs and the income that comes from
a steady paycheck? Because, in some
cases it just isn’t worth it. A bad job
is a bad investment. As a financial
advisor who provides counsel on investment portfolios, if there’s a
non-performing asset, we have to re-balance that portfolio. Well, when looking at the “return on life,”
if your job is a non-performer dragging down the rest of the assets in your
“life portfolio,” such as relationships and health, then we need to make some
changes in that portfolio too. Failing
to do so could jeopardize other life goals. When a
woman in her fifties first came to see me a year ago, she wanted to focus on
retirement planning. I always begin
such interviews by exploring the timeframe we’re dealing with and the reasons
why retirement is being considered. In the case of my client, I learned she
wanted to retire for a couple very practical reasons: she didn’t like her
job, she spent too much time commuting, was under
too much stress, and work/life balance was not something her multi-national
company fully embraced. As a matter
of routine, I give my clients interested in retirement planning the book The New Retirementality
by Mitch Anthony. After discussing the
“retire-myths” Anthony outlines in the book, we explore alternatives and
options. Again, in the case of my
client last year we looked at restructuring her finances so she was not as
dependent on the high level of income that comes with an extremely stressful
job. We developed a transition plan to some other kind of employment in a few
years. In the end, she decided that
she was willing to stick it out until that time. The job
continued to deteriorate over the next six months. My client came to realize that no amount of
money made from her job could compensate her for her out of whack life
balance. She had other alternatives. That alternative is to experience a year or
two on sabbatical to renew, recover, and re-energize. “I’d give
the shirt right off my back if I had the guts to say…” the Paycheck of a
different sort suggests. I find people
are more constrained by their fears when making this kind of decision, than
by their finances. The key is to
visualize the worst thing that can happen and accept that as a possible
outcome. Once you do that, you can
develop the steps to handle that situation.
Facing that fear empowers you to no longer feel you are trapped in a
job or in any situation that does not support your life planning goals. Besides
restructuring your view of fear, you also need to restructure your financial
obligations. Do you really need the
biggest house that your current income can support? Do you need a new car every two years? It isn’t about things or numbers; it’s
about quality of life. The key is to
make sure you have skills that will be needed elsewhere and that you are
flexible and willing to embrace change.
And, get some advice. Most
wouldn’t buy or sell their house without the help of a real estate agent, so
why go alone into this deal – changing or leaving jobs, which like a housing
change, could involve hundreds of thousands of dollars over your working
years. This
isn’t just an issue for those near retirement. Recently, we went through the same exercise
with a woman in her thirties. This is
an issue for all of us. As Anthony
asks in his book, “How Much is Your Paycheck Costing You? Michael P. Haubrich, CFP
is President of Financial Service Group, Inc., a Registered Investment
Advisory Firm in |