How personal finance is career management

By Scot Herrick | Personal Finance

Jun 17

When CIO’s start getting articles about personal finance — the basics, not the fancy investments — you know that personal finance has come to career management.

Here’s the basic thrust of Where Personal Finance and Career Management Meet:

Good career management stems from a foundation of good financial management. Career freedom and financial freedom begin with effectively managing our money. Which leads me to our other big problem: Most of us don’t know how to manage our money. As a result, we get stuck in jobs we dislike just so we can pay the bills, and we think we have no other choice but to work our pants off for a living.

Let’s offer up some reasons personal finance is career management.

Personal finance manages your attitude

When you have managed your money well, you are not desperate about keeping your job. This has a significant impact on your attitude at work. Desperation puts our career on defense instead of offense. We’re more concerned about keeping our job than we are doing our job.

When we are in a position of keeping our job instead of doing our job, the probability of doing poor work significantly increases. Which, of course, can directly lead to losing your job.

Personal finance helps keep your job options open

Opportunities for jobs come from many sources. When we manage our money well, we don’t have the big bills to pay, big mortgages to keep and big lifestyles to support. Instead, those that manage their money well can have an offer presented to them and not worry about the current bills and the impact a new position would have on them.

You can move across the country for the right opportunity because you’ve managed your money well.

Personal finance levels the layoff playing field

When you manage your money well by having few liabilities, your risk of being hurt by a layoff is reduced because you need less money to live on while laid off. I’ve also consistently advocated having one year’s take-home pay in the bank. The reason? When you don’t have to worry about paying your bills for one year, it gives you the time you need to adjust to the layoff and enough time to find your next gig.

Learn to manage your money

I’m not a financial consultant and it has taken me a long time to learn about money management. But your focus should be on limiting your liabilities, increasing your assets, and getting to one year’s take-home pay in the bank. Making progress on those money goals will give you peace of mind. In today’s economy, we all need that.