For some people, their job is their life — for others, it’s just a way to make money. Whether you’re defined by your career or not, there’s no denying the financial impact your career has on your finances. Your job is a financial asset, and for most, it’s the most important one they have. As your main source of income, your job should be looked at in the same way you’d look at any other financial asset.
Shaping your career and making strategic decisions to improve within that career are all vital in making this asset a lucrative one. You’ll want to create a financial foundation with your job in order to maintain your security. By understanding your worth and transferable skills, you’ll better understand how to leverage your abilities in order to get the most out of your career. After all, your job is more than what you do, it’s your biggest financial asset.
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Creating your Financial Foundation
Many of us view our investments, collateral, or savings as assets, but neglect to include the money that is coming in at a consistent rate. Your income is your financial foundation, and how you handle your career choices has a big affect on your foundation. Income is different from other financial assets largely because you spend 40 hours every week creating it. It’s not all about the money, it’s about being happy with the way you’ve chosen to accumulate your financial foundation. Not only is your career a major aspect of your overall financial picture, it also plays a big role in things like retirement and benefits. If you continue to gain skills, you’re making your financial foundation even sturdier. Your job is not only a paycheck, it’s the biggest factor in deciding the rest of your financial lifestyle.
Like tangible assets, the last “price tag” on your career (previous salary) can inform negotiations over your next salary, just as Blue Book values inform auto sales. Alternatively, a company that emphasizes training and skills-development can help prepare you for negotiation in a different way, even if it isn’t paying as much up-front. Sort of like the difference between growth stocks and dividend-paying stocks. So it’s not all about the dollar amount, it’s about what the career is offering you as a long-term investment. Any asset is capable of both appreciation and depreciation. In order to ensure your career asset is appreciating, think about the long-term offering and not only the short-term.
The End of Long-Term Company Loyalty
Finding an employee that’s been with their company for 20 years or more can be a difficult thing in a modern career path because it’s just not as common anymore. The reason for this can be tied to more people seeking higher education, though additional alternative reasons are surely abundant. However, when you were able to leave college and jump into a career with a company that helped mold you into an employee with skills specific to their organization, company loyalty was more common. Not to mention the skills obtained by employees weren’t as transferable as they are when they are taught in a broad academic setting. It’s hard to leave a company when everything you know about an industry is tied to them.
The downside to that model is that companies were able to take advantage of that loyalty. Now, employees are more likely to leave if they aren’t being treated fairly or if they don’t fit within the company’s culture or bigger picture. If you are looking at your career as a financial asset, it’s harder to allow yourself to be taken advantage of. In other situations involving investments, you get out if the stock is plummeting and the same should hold true for the investment that is your career path. If your company is paying you a fair salary, you’re happy, you are offered opportunities for advancement, you are on the track for retirement, and you are offered benefits, company loyalty is the smart financial decision. However, if those needs are not being met, it may be the smartest decision to “sell the stock,” so to speak.
Cultivating Transferable Skills
Cultivating your own transferable skills is similar to having a home or a property as a financial asset. By updating your appliances, renovating the bathrooms, and adding an extra room, you’ve made your home better for you to live in, and increased it’s value when it’s time to sell. In treating every career opportunity as a way to gain skills, you’re making yourself a better employee for your company, and making yourself more marketable for your next career opportunity. In order to treat yourself and your career as an investment, you should view every opportunity as an extra bedroom added to a property.
It’s common for people to view their position, their company, or their degree as their asset, but those things are simply pieces of the ultimate asset, which is yourself. Cultivating skills that can transfer from company to company is vital in building your career as a financial asset. Working on your career skillset is a way to increase this form of personal investment. Skills make you marketable, and focusing on skills that can transfer between positions, companies, and career fields are even more important to turn your career into an even more lucrative asset.
Your career, unlike other investments, is something you have much more control over. Cars, for example, do almost nothing but depreciate from the moment you buy them; you can try to improve your home, but the larger market conditions are well outside your control, and how your house appreciates can be hard to predict or manage. With stocks, you pretty much buy and sell in response to market performance. Career skills, on the other hand, may be the most directly within your influence. Market trends and needs may change, but you can stay tuned-in and keep developing yourself.
Understanding your Worth
Because your career is such an important financial asset, it’s important to focus on yourself, your career, and what is making you successful. Like mentioned before, staying at a company long term is not the best decision if the company isn’t treating you correctly. Understanding your worth is about understanding the value of your skills in your industry, and being able to identify if you’ve reached your full potential in your company. Your worth is significantly higher when you have strong work ethic, a dedication to your career, and a desire to move up. For these reasons, it’s important to cultivate skills within your industry, not just your employer. This way, if your employer doesn’t understand your worth, you can seek employment elsewhere.
Not only is it important to understand your worth in your company and your industry, it’s also important to understand what your financial assets are worth. Happiness and fulfillment are not all about a dollar amount, but part of these things are connected to creating a financially secure life for yourself. Your credit, retirement, lifestyle, health, and overall financial health all come back to your main source of income: your job. Those things are worth a lot, so it’s important to recognize your full career potential so you don’t sell yourself short in other ways.
When you spend so much time working, it’s important to enjoy your career. It doesn’t have to be the most important thing about yourself, what you’re most passionate about, or the best part of your day, but it should be something you’re comfortable nurturing for the rest of your working life. Building a strong financial foundation is about realizing that foundation is built from the money you make working, and it goes up from there. By making yourself as marketable as possible, you’re building your biggest financial asset. Understand your worth, keep building transferable skills, and don’t be afraid to make career changes that help you grow.
Just out of college and using your career to help pay off student loans? Visit our student finance learning center.
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