Are you concerned with the highest paying jobs and top careers, or are you more concerned with job satisfaction?

Right or wrong, one of the first criteria many college students look at when choosing a college major is how much the job pays right out of college. It’s always a good idea to know how much you can earn in any given field, but choosing your career path based solely on potential income is probably not the best way to make major life decisions – and when you look at the list of the 10 highest paying college degrees, you will see why. It takes a special mindset and skill set to get a degree in most of these fields.

Top 10 Highest Paying College Degrees

This list covers the starting salary for the top 10 paying undergraduate degrees for 2010. It does not cover the top paying 2 year degrees (such as some nursing degrees), or starting salaries for those with professional degrees, such as doctors, lawyers, MBAs, etc.

The starting  salary information was provided by National Association of Colleges and Employers (NACE) which analyzed data from 200 college career centers at public and private institutions across the United States.

1. Petroleum Engineering ($86,220)
2. Chemical Engineering ($65,142)
3. Mining & Mineral Engineering (incl. Geological) ($64,552)
4. Computer Science ($61,205)
5. Computer Engineering ($60,879)
6. Electrical/Electronics & Communications Engineering ($59,074)
7. Mechanical Engineering ($58,392)
8. Industrial/Manufacturing Engineering ($57,734)
9. Aerospace/Aeronautical/Astronautical Engineering ($57,231)
10. Information Sciences & Systems ($54,038)

Best Undergrad College Majors By Starting Salary

This is another salary chart, this time breaking down the salary ranges into starting median salaries (Blue) and mid-career median salary (Gray). Methodology Used: Annual pay for Bachelors graduates without higher degrees. Typical starting graduates have 2 years of experience; mid-career have 15 years. See full methodology at PayScale for more information.

Engineering & computer degrees have highest starting salaries

Regardless of which of these two lists you use, it is clear that the top 10 college majors, as far as entry level salary are concerned, share a common denominator: they are all based in science or engineering. In the NACE starting salary report eight of the top 10 highest paying college degrees are engineering degrees and the other two are related to computers and information sciences. The Pay scale report lists 7 of the top 10 as engineering degrees, two related to computers, and economics (though it appears economics makes this list based on the mid-career salary than starting salary).

What are the highest paying jobs?

The jobs in these lists are some of the top career choices for starting salary, but that does not mean they are the highest paying jobs overall. These lists were compiled to compare starting salaries of jobs requiring a four year degree. Some jobs that require additional degrees, skills or certifications may pay more than these jobs, even at the mid-career salaries you will find on the PayScale chart. Some examples of higher paying jobs can be found in the medical field (doctors, anesthesiologists, surgeons), lawyers, MBAs, and similar jobs. Many people who get into top management or run a profitable small business also earn more than the top salaries you can earn in the jobs listed above.

Chase your passions – don’t let starting salary be your guide

Starting salary is important, but it shouldn’t guide your life or every decision you make. Engineering and computer science are great fields to get into, but unless you are passionate about the subject, you probably won’t enjoy the required schooling or the job. You will probably be much better off in the long run if you go after the career that offers you the most job satisfaction.

~$~

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Do you know who is watching and listening to you at work? It’s probably not just the person in the cube next to you. The chances are very good that your employer has the ability to monitor your e-mails, phone calls, instant messages, and internet usage. Our company’s IT department actually has the ability to take control of our computers remotely (I found this out one day when I called our IT department with an issue and the tech took control of my laptop while on the phone with me, made some changes, and returned control of my computer to me).

While it sounds like a breach in privacy, many courts have sided with employers in regard to e-mail and other communication privacy issues. And many companies are using e-mail and instant message monitoring to protect their proprietary information and make sure employees aren’t using their time for non-work related activities.

Companies can monitor your communication

Like it or not, your company probably has the ability to monitor just about everything you do on the web or via phone. Companies monitor many forms of employee communication, often including e-mail, phone calls, voice mails, instant messaging, and internet use. The intent is often to monitor quality control and protect their intellectual property, and the results can lead to a lack of privacy and potential job loss for abuse. Here are some of the forms of communication some companies monitor.

E-mail and instant message. Every e-mail and instant message leaves an electronic trace as it passes through the system. Even if you clear your inbox, trash, and sent folders regularly, there may be a permanent record of your e-mails in the company system. The same goes for instant messages if you company uses those. For the most part your communications probably won’t be monitored unless it is a random check or there is good cause, but you never know.

Phone calls and voice mail. It is easy for IT departments to monitor which phone numbers are called, including frequency and duration of calls. However, it is more difficult to monitor the content because it takes an active listener and there may be state or federal laws involved depending on the type of phone call. Most companies have a written policy which states when and how they might monitor phone calls.

Internet usage. This is probably the biggest area for abuse. Monitoring internet usage is incredibly easy for IT departments. Many companies block “time and bandwidth wasters” automatically, usually sites such as social media sites (FaceBook, MySpace, twitter, forums), bandwidth hogs (YouTube, Pandora, other streaming sites), auction and shopping sites (Ebay, Craigslist, etc.), peer to peer sites, and other file sharing sites. But just because a site isn’t blocked doesn’t mean you should visit it from your work terminal. Depending on company policy, visiting some sites and abusing internet privileges can be grounds for instant dismissal.

Legalities of communication monitoring

I won’t profess to be a lawyer or dispense legal advice. All I can do is say there is a lot of gray area when it comes to monitoring employee communication. Some laws are more clear than others. Here are some articles I found helpful:

• Email Monitoring: Can Your Employer Read Your Messages?
• Workplace Privacy and Employee Monitoring.
• Monitoring Employee Communications.

Whether you are an employee or employer, it is a good idea to review current communication policies and consult with an attorney if necessary.

Protect yourself

The obvious response would be to tell you not to do anything that could be used against you. But who really knows what that means? Does that mean never visiting CNN news on your lunch break? Or check the weather before your evening commute? The best advice I can give you is to treat all communication as though it is monitored and not to send anything you wouldn’t want your boss to know about.

It is also a good idea to refer to your employee handbook to read about your company’s communication policy. Most large companies and many smaller companies have a policy in place that should remove much confusion (this is to protect both the company and the employee). You can also speak with your HR rep, manager, or someone in the IT department to determine how much power they have and under what circumstances it can be used. In most cases, they will be happy to tell you what they can and cannot do. And the monitoring ability they have just might surprise you.

~$~

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I’ve thought and written a lot about investing and I frequently visit numerous high quality personal finance blogs and websites (including CashMoneyLife, of course). I’m convinced that there’s a common denominator at work here, that those who succeed at improving their financial lives share a similar perspective.

I’m not talking about an identical set of beliefs or some kind of shared theology of finances. I’m talking about something more basic, whether it’s ever explicitly expressed or not: the idea of self ownership.

In a nutshell, this is what I’ve learned: If you’re serious about improving your financial well being, of taking your life to the next level, you must own, really own, some area of your life.

Financial freedom, I contend, is more than simply being debt free. It requires you to be proactive, brilliant even, in some corner of your life.

Conventional wisdom and good advice, on the other hand, are for those without the interest in or aptitude for self ownership. When CNN, for example, runs any kind of personal finance segment, you have to keep in mind that it’s designed to target the widest possible audience. And that means 90% of the adult population who spend maybe ten minutes a month contemplating their finances.

Do you have to be brilliant in every aspect of your life? Of course not. But there’s no excuse for not striving to be so in some area of your life. In general, I find that there are four general categories from which to choose:

#1. Career

I mean absolutely no disrespect to anyone when I say this, but anyone can live a life caged inside a cubicle, shackled to a desk, or answering the phones for someone else. And a lot of people do. The road less traveled is reserved for those who refuse to play it completely safe, for those who choose to become financially sophisticated instead of being a lifelong indentured servant.

Are there employees who love their jobs and who would describe their careers as fulfilling? I’m willing to assume that there are. But in my experience, for most individuals, employment is simply a necessity of life with which they’ve made some kind of peace. It’s something that just is.

If you’re one of the fortunate ones whose job is your calling, then congratulations. You’ve found the brilliant area of your life, and you can afford to simply make prudent and common sense financial choices and follow the conventional wisdom in regard to retirement accounts and such. You’ll be fine.

Why? Your passion for your work gives you three important structural advantages: you’ll most likely excel in your work, you’ll always be employable, and you’re much less likely to burnout than your frustrated peers.

#2. Entrepreneurship

Owning your own business is fraught with peril, but, when successful, there’s generally no quicker path to wealth and financial independence. Entrepreneurship is the foundation of the American economy, and to a large extent, American culture as well.

If you can provide products, services, or information that enough people find valuable at some level, and if you can effectively communicate that value and availability, you will succeed. If not, you will fail. It is a harsh but simple reality.

#3. Frugality

I differentiate between frugality and being cheap. Frugality is an art and it’s about priorities and choices. In contrast, being cheap is an expression of insecurity. Its message is one of personal inadequacy and lack.

There’s a great paradox to frugality that any truly frugal person knows. Frugality is not privation. It’s the art of experiencing your material life more deeply through simplifying, decluttering, and stripping away the noisy and the unnecessary.

Disclosure: I wish this were my brilliant area!

#4. Investing

I understand the logic of maxing out your employer-matched 401K and the long term tax advantages of fully funding your Roth IRA. But I am highly critical of the mutual fund industry and the idea of putting my money somewhere that I can’t access for decades has always seemed crazy to me.

Due to fees, transaction costs related to overtrading, and the short term mindset on Wall Street, the vast majority of all mutual funds underperform the market as a whole.

Index investing or ETF investing isn’t much better. Diversification is a kind of respectable sham, a wide net that catches all fish. Yes, you gain the benefit of investing in great businesses. But whatever advantage you gain from doing so is more than offset by everything else you dredge up from the deep—including the more numerous average businesses and the ones flailing their way along to obsolescence.

Unless you run your own business, or have investments beyond retirement accounts, or have eliminated a large number of your expenses, full participation in a 401K and an IRA pretty much guarantees that you will always work for someone else until you’re too old to work.

Leveraged Investing

Personally, I would rather be a proactive and self-directed investor and take my profits and cash flow now rather than abdicate that responsibility to strangers with poor track records, short term trading mindsets, and way, way too much money to manage. I’m confident that I can compound better on my own, the negative tax considerations notwithstanding.

I am an investor, not a trader and not a diluted victim of the managed money industry. I invest in shares of only the highest quality companies I can identify. The only question then becomes the issue of price.

[note: almost every time I make a statement like this, abdicators and proponents of the managed money industry will reference the most recent high profile corporate bankruptcy – as though brand recognition is the sole component that makes a corporation an attractive investment.]

Obviously the less I pay, the greater my returns will be. My own approach is to use a variety of conservative option trading strategies to lower my purchase price – before, during, and after I actually acquire the shares.

I call this approach Leveraged Investing. If I can use options to continually lower my cost basis on my long term holdings and then reinvest these “rebates” as it were, then I’m going to dramatically speed up an already superior investing approach.

I’ve written extensively about Leveraged Investing on my Great Option Trading Strategies website. I realize this approach is not for everyone, but for those with a long term mindset and an interest in enhancing their investments, then this buy and hold and cheat approach might be worth considering.

Self-Ownership Conclusion

I believe in the supremacy of the individual, the focused and motivated individual empowered by a community (online or off) of other like-minded individuals. In the Christian tradition, Jesus of Nazareth famously states: “Ask and it will be given to you; seek and you will find; knock and the door will be opened for you.”

To me this statement implies three very important ideas: you CAN realize your desires, there’s no single path for doing so, and persistence pays off.

And how do you know when you’ve arrived? When you see that CNN segment on a topic about which you’re knowledgeable and skilled and you have no choice but to roll your eyes at the simplicity of the advice.

Brad Castro is an investor and writes about investing and related topics at his website, Great Option Trading Strategies.

~$~

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Many of you may have already heard of the Pareto Principle, or the 80/20 rule. The rule was named after an Italian economist who noted that 80% of his country’s land was owned by 20% of the population. The 80/20 principle was later adapted by Quality Management pioneer Joseph Juran, who observed that 20% of your efforts result in 80% if your returns, and the remaining 80% of your efforts result in 20% of your returns. He surmised that if you focus on the 20% that gives you the greatest returns, you could eliminate a lot of waste and increase your productivity. The Pareto Principle can be applied to almost any aspect of life, including your career and your finances.

Applying the Pareto Principle to work

The office setting is full of wasteful activities – e-mail, meetings, unnecessary paperwork, etc. You may not be able to eliminate each redundant procedure because it may be company policy. But you may be able to find more effective methods of dealing with them, or you may make recommendations to the policy makers to make your job (and that of everyone else) easier. Here are some other ways you can increase your productivity:

Make a list and check it twice. The first thing I do when I arrive at work is sit down and create a list of the tasks I need to accomplish that day. If I am working on a long term project I try and break it down into bite size goals or milestone markers that I need to achieve by the end of the day or week. Once I make my list and boot my computer, I am ready to take 5 minutes to get a coffee and talk football with my coworkers. Then it’s off to the next big time sucker – e-mail.

E-mail productivity. I have worked in a few large organizations, and they all have one thing in common: the proclivity to send mass quantities of e-mail announcements. One large organization I worked for sent out an average of 10-15 of these announcements daily, while my current organization sends out about 5. To make my life easier, I created a folder for these announcements and a filter that automatically files them to that folder without it ever hitting my inbox. I check the folder once in the morning and once in the afternoon, and usually can delete 90% of them without ever opening them. The rest are rarely, if ever, time sensitive, so saving them for the end of the day is not a problem.

Another e-mail tip to save time and productivity is to never open, send, or forward chain mails and similar e-mails. Not only are they a huge time suck, but they use company resources and are probably against company policy.

Meetings. In my former job we called them “beatings” because they were long, painful, and usually useless. If you can’t get out of scheduled meetings, then find a way to be more productive, such as starting each meeting with an agenda and guiding the participants back toward the agenda if they stray off topic. You can also take notes or work on another task if possible. If none of those work, then visit this site for a timely text message to get you out. Just don’t try it too often.

Applying the Pareto Principle to your finances

Manage your money effectively. Dealing with finances can be difficult under the best of circumstances, so it pays to streamline your processes as much as possible.This can include automating your finances, closing unnecessary accounts, and tracking your money.

Consolidate accounts. I recommend keeping the essential financial accounts, and closing the rest. That can include closing extra savings accounts, rolling over 401ks into an IRA, consolidating debt, and consolidating multiple retirement accounts. Just be aware that closing credit card accounts can affect your credit score.

Budget. You will have a more difficult time managing your money if you don’t know where it is coming from and where it is going. Create a simple budget and track your finances with something as simple as a pen and paper, a spreadsheet, or a dedicated software program. Here are some reviews of free online money management software programs, and some popular programs including You Need a Budget and Quicken 2010.

Automate your finances. Automating your finances reduces the amount of time you spend dealing with opening bill statements, writing checks, visiting websites, etc. Use your online bank or a credit to pay recurring bills such as your cell phone or cable, use online bill pay, and make automatic invstment contributions. You want to verify your transactions at the end of each month, but you don’t want to spend a lot of time tracking them down. Automating your finances saves you time and money.

Applying the Pareto Principle in your life

You can easily apply the Pareto Prinicple in other aspects of your career and finances, and you can certainly use these principles in other areas of your life as well. Go in with the mindset of achieving results and you will increase production. Start with the low hanging fruit, work toward the bigger processes, and practice continuous improvement methods such as Personal Finance Kaizen. I’d love to hear how you apply these principles at work or at home.

~$~

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I’ve worked in several different professional environments in my career – the military, consulting, and now as a contractor on a large project. One constant I have seen is the conflict between supervisors and their employees.

Don’t get me wrong, most supervisors are trying to do their job and do what is best for the company. But there are always some supervisors who like to make work hard for their employees. Why? It can be a pure power play, to hide their ineptitude, to cover up their lack of work ethic, it could be pride, or it may just be personal. There is no definitive list of reasons.

Common traps include making you look bad, changing assignments at the last minute, changing due dates to make you miss an important deadline, taking credit or your work, lying to you or making you look like a liar, spreading rumors, etc. Again, the list is limitless. Fortunately, there are a few things you can do to help avoid conflict with your supervisor.

How to Avoid Conflict With Your Supervisor

The first thing you need to recognize is what is happening, even if you don’t understand why. Look for patterns or signs that you are being singled out and that this isn’t your supervisor’s way of treating everyone. It’s a lot more difficult to avoid conflict if your supervisor treats everyone the same way. Once you determine there is a pattern, try some of the steps below. You will find that not all of them will apply to you, and in some cases you will need to think out of the box. If you have additional tips to avoid conflict or have stories you wish to share, please leave them in the comments section after the article.

Talk to your supervisor.

Try to schedule a meeting with your supervisor to discuss the issue. Many people prefer to avoid conflict once it is out in the open. The key to this step is not to bring emotion to the meeting. Reiterate that your only goal is to help the team and ask for ways that you can improve your performance or provide more value. You will get a lot further if you take the approach of being a team player.

Avoid conflict and gossip.

Try to remove all emotion from the situation – regardless of what the supervisor says or does. Do what is asked without griping or pushing back. Don’t give the supervisor a reason to say or do anything that can be used against you. You may find it helps if you can keep conversation to a minimum and respond with minimal, “yes/no” responses, and avoid unnecessary opportunities for conflict. At the same time, don’t gossip about your supervisor or anyone else. If you have an issue with someone, take it to them personally. Don’t air your issues to your coworkers.

Make your supervisor look good.

Your boss is less likely to pick on you when you make him or your team look good. Contribute to meetings and projects, and be sure to spread the credit to the team. Drop your supervisor’s name in a favorable manner if it is merited. Avoid correcting your boss in front of his manager or a group of people unless it is necessary. Many times you can pull him or her aside and give the correct information afterward.

What about the supervisor who wants to take credit for your work? This can be tricky, and often the best way to handle this is to take credit before there is credit to be given. For example, carbon copy multiple team members and interested parties on progress reports, including your supervisor’s boss if you can get away with it. Blind carbon copy works great here too. You can also speak up in meetings regarding progress or give updates on a new feature you created. The key is to do it in a way that keeps everyone informed of what you are doing, but doesn’t come across as bragging.

Don’t be a target.

Arrive to work a few minutes early, stay a few minutes late, take short lunches, avoid hanging out in the break room or taking long breaks, etc. Leave a note on your office door or on a dry erase board in your cubicle when you are in a meeting or have an appointment. Be sure to write down the time you will return, and leave a pen for others to write a note for you. In short, don’t give your boss any reasons to call you out.

Document everything.

A common supervisor trap is to put you in a position where it is your word against his. Unless you have proof to the contrary, you aren’t going to win. So document everything. Archive your e-mails and files to your hard drive, and back them up to a thumb drive if you need to. That way your supervisor’s claims against you can be quickly corrected. Carry a notebook to meetings and everywhere else you go. Be sure to write down important dates, assignments, requirements, or anything else that is relevant to your task. You will then have written proof and it is no longer your word against his word.

*The purpose of this isn’t to be smug or trap your supervisor; remember we are trying to avoid conflict. So instead of throwing this back in his or her face, try gently reminding your supervisor that you believe the information you have is correct and you have it documented. Your supervisor will most likely stop trying to use this trap against you once he figures out he can’t win.

Repeat questions during conversations.

This goes hand in hand with the documentation. Repeat instructions or tasks that are given to you during or at the end of the conversation. Be sure to repeat the key information such as requirements, due date, and other important issues. This is another place where your notebook comes in handy. Be sure to jot down this information in front of your supervisor. This will demonstrate that you are paying attention making an effort to meet deadlines for the tasks you are assigned. It also gives you documentation to prove you were on target and makes it less likely your supervisor will try to move dates or change assignments on you in order to make you look bad.

Contact Human Resources of your supervisor’s boss

You want to avoid escalating the matter if possible. It’s messy and can lead to more tension in the workplace. But sometimes it is unavoidable. In most cases you want to leave escalation as a last result, however, if your supervisor is breaking laws or company policies, you are well within your rights to escalate the matter.

Equal Opportunity Rights and Federal Laws

The tips above refer to dealing with a boss that can be overbearing or just difficult to deal with. If you believe your manager is breaking federal equal opportunity employment laws, then you need to document your case and contact your human resources department.

The U.S. Equal Employment Opportunity Commission (EEOC) enforces discrimination against:

• employment discrimination based on race, color, religion, sex, or national origin;
• age discrimination which protects individuals who are 40 years of age or older;
• individuals with disabilities and pregnant women;
• (see overview of laws and EEOC home page for more information).

Individuals who file a discrimination complaint are also protected against retaliation. Just keep in mind it is also against the law to file a false claim.

Do you have any other tips to avoid supervisor conflict, or do you have any stories to share? If so, leave them in the comments section.

~$~

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Earlier this year my wife and I had our first child which made us rethink our financial planning. One of the new expenses we need to plan for is college education. Even though our daughter still has about 18 years before she will be going to college, putting a plan in place now is a good idea, because if today’s tuition rates are any indication, college will be an expensive endeavor!

We researched college education plans and decided to open a 529 College Savings Plan through CollegeAdvantage, Ohio’s 529 plan, because a 529 plan best met our needs. Check out the 529 vs. the Coverdell for more info on the two most popular college savings options.

Why Choose the Ohio CollegeAdvantage 529 Savings Plan?

The Ohio CollegeAdvantage College Savings plan is open to residents of all states, is rated as “Top 5″ in the nation by Morningstar, and features low cost investment options (including several options from Vanguard). Additional features:

• No enrollment or maintenance fees
• Open with as little as $25
• Tax breaks on contributions for OH residents
• Tax free withdrawals for qualified educational expenses
• $25 sign up bonus – use referral code: 2534946
• $25 Automatic contribution bonus
• $50 “Refer a Friend” bonus

The 529 also offers the flexibility of changing your account beneficiary to another family member at any time, which is nice because that means we can open 529 plans in my name, my wife’s name, and our daughter’s name, and then transfer the benefits to our daughter (or future child) without penalty when she goes to school.

Opening new accounts will earn us $200 for our daughter’s education

I opened an account in my name this before our daughter was even born, but I decided to wait until after our daughter was born before opening an account in my wife’s name. With the current bonus options in place, now is a great time to open an Ohio CollegeAdvantage 529 plan.

How we will earn $200:

• I refer my daughter and I receive a $50 referral, she receives a $25 bonus. ($75)
• Refer my wife from my daughter’s account. Daughter receives $50, wife receives $25. ($75)
• Set up an automatic contribution to both accounts; $25 each ($50)
• Total = $200

How to receive the $25 Ohio CollegeAdvantage referral offer

You need to use a referral code to get the $25 College Advantage sign up bonus. Here are the details:

• Open a new College Advantage 529 Savings Plan with a minimum of $25.
• Enter the following referral code: 2534946
• Receive your $25 bonus within 7-10 business days.
• Offer expires December 18, 2009.

How to receive the $25 systematic savings offer

To take advantage of the Systematic Savings Incentive Offer, you will need to start a new recurring monthly electronic funds transfer (EFT) or payroll deduction between September 1, 2009 and January 31, 2010 with a minimum contribution of $25 per month and it must remain active for at least 90 days. The $25 bonus will be applied to your CollegeAdvantage direct account 90 days after you start the new recurring EFT or payroll deduction. Here are the program rules and details.

Refer more people for more bonuses

Earn more bonus money. My family can get $200 from this program, but you could easily earn several hundred more if you have a large family or extensive network. You can refer friends and family for additional bonuses – they get a $25 sign up bonus and you get a $50 referral bonus. It’s a win-win situation for all involved.

If you are looking for additional ways to save for college, then I recommend looking into Upromise – Earn Free Money for College.

~$~

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Your job isn’t permanent. Even if you are good at your job there is no guarantee that you won’t receive a pink slip. The economy is changing and many companies are slashing costs to remain in the black. Simply put, you have no guarantee that you will have a job tomorrow.

One of the first lessons in investing you learn is to diversify. Placing all of your investing eggs into one stock is a recipe for disaster. The same is true of your employment and income. You must protect yourself through diversification of income.

One potential step in that direction is through contracting.

Earn Side or Full-Time Income with Freelancing

The beauty of diversifying your income streams is you don’t have to jump in head first. I’m not telling you to quit your desk job to be a starving artist. You can pick up one project every six months just to get a taste of what it is like.

What I am encouraging you to do is this:

• identify your true skills
• identify opportunities to put those skills to profitable use
• maximize your earning through negotiations

Your true skills might be something you do on a daily basis or it might be your favorite hobby. Freelancing and contracting are like any other job, and  doing something you enjoy will help make the project not seem so much like work. The result of doing something you enjoy is more satisfaction and better quality results because you’re doing something you enjoy.

Looking to perform freelance work or hire a freelancer? Read this oDesk review to see how you can find and hire freelancers to perform tasks for you, or how you can bid on jobs as a freelance worker. There are thousands of job opportunities available.

Pros and Cons of Freelancing and Contracting

If you are an unemployed worker or you are looking for another source of income, then I highly encourage you to take a contract or contract-to-hire position.

Pros of contracting:

• You are unemployed — this is a job — as we’ve discussed in the past you should take almost anything that earns you income
• You only get to keep a job if you are good
• It can turn into a “permanent” job
• Is a foot in the door
• You can earn more money as a contractor or freelancer

Downside of contracting:

• You only get to keep a job if you are good
• You aren’t truly “a member of the team” and can sometimes been seen as the first to go (although sometimes smart employers cut perm employees first because of the cost of benefits)
• Depending on the contract you may have to do your own taxes

Take at look at the list. I think the pros far outweigh the cons even if you are a “permanent” employee.

The real kicker with contracting is you must be good at that skill. Contracts are amazingly efficient at determining quality in a short period of time. If you are simply average at your job the client will not be willing to pay a higher rate for your services. And why should they when they could hire another average person for less?

The Only Way to Be Un-Fireable

I mentioned at the beginning of this article that even if you are good at your job you could still be pink slipped.

Want to be in a situation where you cannot be fired? There is one simple solution: be your own boss. This is the ultimate extension of contracting and freelancing. Take your skills to the point that you make the decisions — what clients to take on, when to go on vacation, and how much effort you must put in to meet the client deadline.

Again you don’t have to rush out to start two companies right this second. First evaluate your skills and the value the market sees in those skills. Then pick up a contract or two to get a taste for freelancing. Use those first few projects to build a great reputation and before you know it your income streams will be as diversified as your investments.

~$~

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This is a guest post by Kevin, who writes a get out of debt blog at No Debt Plan. He wants to help you get and stay out of debt. This is the third post in a series on unemployment and your finances.

In my first article I challenged your thinking on turning down job offers when you are unemployed. Last week in my second article I showed you the math on why taking a pay cut can be a great idea in the long run.

This week I hope to scare some sense provide insight into your “permanent” employment status.

I work as a recruiter for my career. I talk to hundreds of people each year and meet somewhere around 300 of them in person. That’s a lot of people and a lot of conversations about employment, benefits, and pay.

In my business we do a lot of contracting. Sometimes it is just a short term project a client needs completed – you work for three months, finish the project, and then you are done. In other instances the contract is more of a “try before you buy” situation for the employer. That is, they get to test you out for six months and before making you a permanent job offer.

Almost Everyone Wants to Be Permanent

Ah, the permanent (also known as perm) offer. The coveted piece of job real estate that everyone seeks. It’s comfortable. It’s secure. It’s just better.

Or is it?

One of the first questions many of the potential candidates I talk to on a daily basis ask is, “Is it a permanent job?”

If I don’t say anything other than “YES!” the job candidates usually don’t walk to talk to me anymore, even if the position has a great potential of going permanent (like a contract-to-hire).

That thinking is beyond flawed and I’m here to convince you why. (If I can’t do that I hope to at least make you pause and think about it. Fair?)

Dissecting the Perks of Being Permanent

If you ask someone to explain why they so badly want to be permanent you will likely get one of the two following answers.

1. Benefits – Everyone needs benefits in some way. Medical benefits being at the top of the list, followed by everything else like retirement, disability, and life insurance.

I will concede for the most part on this one. Medical benefits are likely to be very expensive if you purchased them on your own. However, many companies are switching to high deductible health saving plans in order to save the company money. You end up paying the same or higher premiums and have to front a large yearly deductible before the real insurance kicks in.

In terms of retirement, your 401k may be costing you more money than you realize. Many company 401k plans have hidden expenses added to them that dampen your returns. If you had invested that money into a Roth IRA instead of a 401k, those costs would be transparent (and likely much lower).

2. Stability – This is nearly on par with benefits. The stability of being permanent. What does being permanent even mean? Many people seem to think once you are hired it means you’ve been given the golden ticket. Time to work hard, earn a decent salary, and work an 8 to 5 schedule. Retirement is just around the corner!

Stability and the guarantee of a paycheck are driving forces for many people I talk with.

No One is Truly Permanent

Here’s the catch: no job is truly permanent. How many so called “permanently employed” family members or friends have you seen be laid off in the last twelve months?

When you hear about factories closing and rising unemployment do you wonder if they were contract laborers or permanent employees? I would argue a large chunk of them were permanent employees.

You see that’s the kicker: no one is truly permanent. From CEOs that get axed down to the newest guy in the accounting group who never had a chance to make a difference. We can all be replaced or simply let go, and our work put on the backs of those left behind.

I’m not saying contracting is the best thing on the planet. Each type of employment has its perks. But I hope this article challenges your assumptions about permanent employment. Generally speaking, if you are good at your job and the economy and your firm are in decent shape, you should be a low risk for getting laid off.

The problem is when either you or your firm are performing at a mediocre level and the economy goes in the tank. Suddenly decisions are made to cut 10, 15, or 20 percent of the workforce. The best get to stay and the rest… well, you know the rest of the story.

~$~

Related Articles:

1. Consider Contracting and Freelancing
2. Things to Consider When Leaving Your Job
3. Should You Contribute to a 401k Without an Employer Match?