Why Your Career is Your Most Important Investment

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I hate my job…I can’t wait until I retire…I’m going to save and invest every dollar I have so I can quit my job…I wish they’d lay me off and give me a severance package… If you ever find yourself thinking this way, you aren’t alone. Ironically, it’s probably the number one reason motivating people…

I hate my job…I can’t wait until I retire…I’m going to save and invest every dollar I have so I can quit my job…I wish they’d lay me off and give me a severance package…

If you ever find yourself thinking this way, you aren’t alone. Ironically, it’s probably the number one reason motivating people to save and invest their money—planning their great escape from the job. That’s not a bad thing either, but maybe we need some balance.

Your career is an investment all its own; consider the following:

  • Your career is what sustains you until the day you can afford to retire
  • You’ll probably live on the income from your job a lot longer than you’ll live on the income from your investments
  • You need money to invest—that will mostly come from your career
  • Your career is the foundation upon which all other investments will be made
  • If your career isn’t working, your investments probably won’t either

And there are a few more considerations that warrant their own discussion…

Why You Should Invest in Your Career

Very few people have enough money to not work

Millions of people work diligently to save and invest their money. But relatively few will reach a point of being able to live completely off their investments, at least not before retirement. And even then, most will continue to rely on non-investment income for some significant portion of their survival. That may be Social Security benefits, an employer pension or continuing income from a job or business.

Your career is a diversification to your investment portfolio

There’s nothing scientific about investing. Stocks, commodities and real estate both rise and fall in price, and sometimes they can even crash. Fixed income investments don’t usually drop in value, but as we’ve seen in recent years, interest rate yields can drop to near zero. If you’re relying completely on your investments to provide for you, it can be a rough ride.

We normally think of investments as being a diversification against the possibility of a job loss, and that’s true. But what we don’t usually think about is how a career is probably the best diversification against investment uncertainty. The income from a paycheck is never more valuable than it is after a stock market crash.

Your career is your best investment in a changing economy

While it’s true that you can lose your job as a result of economic changes, it’s equally true that you can recover, too. That may involve retooling for a new career, or entering into a new business venture.

The same economic shifts that can destroy careers and industries, also create new ones. The reality is that the majority of us can find paying work somewhere doing something, even if it’s at a much lower rate of pay.

The same isn’t nearly as true of other investments. Stocks and real estate can take years to recover from a major decline. In the meantime, there will be little that you can do to recover your losses until the overall market improves. And if you sell at the bottom of the price cycle your losses will be locked in forever.

Work is your connection to the world

Invest in your careerThough we don’t think about it when planning for retirement, much of our emotional health is tied to our work. It’s where we make our contribution to the world, where we come in contact with the greatest number of people, where we learn to rely on others, and they can rely on us. In a very real way, our sense of legitimacy comes not from what we have, but from what we do. And much of that comes from our careers.

If you had to start all over again, you’d start with your career

Imagine for a moment that you lost all the wealth you have; where would you start the rebuilding process?

It would almost certainly be your career. You’d work harder at your job or business, and if you didn’t have either you’d go out and get one. It would be the first step in your quest for financial recovery.

Very few people can invest their way out of a financial hole. The reality is that it takes money to make money, and if you’ve been wiped out financially, you won’t be able to do that. A career, on the other hand, doesn’t usually require much money.

It does mean taking whatever steps you have to in order to hone the services you provide.

How to Invest In Your Career

If your career truly is an investment, what can you do to make it grow and keep paying you “dividends” in the future?

In General

  1. Stay on top of changes in your field and do what you can to be ahead of them.
  2. Get any extra training you need to do your job or run your business—education doesn’t stop when you graduate from high school or college.
  3. Be a problem solver—anyone can do a routine job, but it takes an expert to fix what’s broken.
  4. Don’t run away from challenges, embrace them and lead others forward.
  5. Keep your eyes and ears open for side business opportunities—you never know when you might need a career change and this is one of the lowest risk ways to do it.

You can apply the tips above in any stage of your career and any industry, but let’s take a look at a few more specific instances below:

Considering College

Pursuing a college degree is a major investment in your career. Keep some of the following factors in mind as you consider your college education.

  • Plan payments: College is a significant investment for students and parents. Regardless of whether or not you pay for your kid’s college, you can work with them to explore their financial aid options and choose a sound strategy for financing their degree.
  • Stay on top of financial aid: Tuition is an investment that needs regular attention. Be sure to adhere to FAFSA and your university’s deadlines to ensure you get your scholarships, grants, and loans, and are aware if the school decreases or increases your financial aid.
  • Choose wisely: When you reach the end of your student loan grace period, you’ll be faced with the financial realities of life. By all means, pursue a degree you’re passionate about, but also consider how your degree will influence your career path, balancing your interests and goals for the future to choose the right program.
  • Consider advanced degrees: An advanced degree, like a Masters or Doctorate, can propel you forward in your field. Many advanced degree programs offer assistantships or stipends that cover the cost of tuition. You may also be able to find flexible programs which allow you to enroll part-time, or with distance education classes.
  • Weigh your options: As you near graduation or enter your first semester and find yourself unhappy in the college classroom, you may be wondering if you need a college degree to be successful. While an education is invaluable and can unlock the door to a bright future, you can find plenty of meaningful high paying jobs without a college degree.

Job Searching

Looking for a new job can be a daunting process for many applicants, whether you’ve been let go, are looking for a new profession, or are simply planning your career to begin with.

If you were to ask for job hunting tips from a recruiter, here are a few snippets of advice you’d get:

  • Presentation counts: One piece of financial advice for high school graduates and middle-aged parents alike is to put some real thought into how you present yourself to potential employers, finetuning your resume to match the job description.
  • Image matters: You need to protect your professional image, both on social media and in your daily interactions at work.
  • The past matters, too: On that note, try not to burn any bridges. If you resign on good terms, you’re far more likely to get a positive commendation if a hiring committee reaches out to your previous employer.
  • So do your extracurriculars: Don’t walk into an interview blindsided when you’re asked about your interests and passions. Being a well-rounded, socially-minded person makes a difference. Seriously, volunteer work can help you get a job and make your life more meaningful.
  • Sell your skills: You can drastically improve your career with sales and marketing skills. Take your Linkedin up a few notches with a compelling bio that showcases your unique talents and quantifies your accomplishments.
  • Pick up a book: Reading, in general, is a great way to invest in your career. I recommend starting with How to Win Friends and Influence People.
  • Go back to the basics: Sharpen your soft skills like leadership, communication, and time management. Something as simple as knowing how to make a professional introduction can work wonders in an interview or networking scenario.
  • Get licensed: In some industries, professional licenses and certifications increase your marketability and salary potential. Take a look at the numbers and see if you could benefit from investing in a course to boost your career.

Starting a Business

Whether you’re a high school student looking for business ideas for teenagers or a stay at home mom looking to work from home, there’s no shortage of profitable business ideas out there.

  • Do your research: You don’t necessarily have to reinvent the wheel to be successful at self-employment. Plenty of successful side hustles and full-time services are in high demand. Look at some businesses you like and take a few pages from their book to get your idea off the ground.
  • Do what you love: You’ve probably heard the adage, “Do what you love and you’ll never work a day in your life.” If you’re starting a business, it needs to be one you’re passionate about. Period. The beginning days of a business are often accompanied by long nights and low paychecks. Passion fuels you to push through the hard times and makes the wins even more rewarding.
  • Do what you’re good at: Along with pursuing a career you’re passionate about, let your professional (and personal) experience and skills serve as the foundation of your business.
  • Consider consulting: People pay for valuable insights, meaning you could build a lucrative business as a career coach or a life coach or a fitness instructor. If you consider yourself an expert in a field and work well with people, you could be an excellent consultant.

At Work

Maybe you aren’t looking for a job or trying to start a business. Investing in your career doesn’t stop with a degree or landing the perfect job.

Here are a few practical ways you can make the most of your days at the office and further your career along the way.

Applying the advice above isn’t always easy, but it will be the most beneficial to your career. Invest in your career by thinking about the big picture and your long term career goals in your everyday actions at work.

Bottom Line

The economy and the job market are in a state of constant change. The best way to invest in your career is by doing what’s necessary to both retain and increase your market value.

Think of your career as an investment. It’s the best diversification to other parts of your portfolio that don’t always behave as we think they should.

Have you ever thought of your career as an investment?



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About Kevin Mercadante

Kevin Mercadante is professional personal finance blogger, and the owner of his own personal finance blog, OutOfYourRut.com. He has backgrounds in both accounting and the mortgage industry. He lives in Atlanta with his wife and two teenage kids and can be followed on Twitter at @OutOfYourRut.

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  1. Rohit @ The Money Mail says

    We live in a very dynamic world. Skills that are in demand today can very well be outdated tomorrow. This is true if you are in an industry which is very technology oriented like a web designer, programmer. You must constantly add new skills to your technical skills

    • Kevin Mercadante says

      Hi Rohit–That’s very true, and it’s just like investments. Some are good today, but won’t be in 2-3 years. We no longer have the luxury of coasting! That’s why, at a minimum, a career should be viewed as a diversification to an investment portfolio. That might even cause us to rethink the whole idea of retirement!

  2. krantcents says

    I agree and there are good and bad investments. I think you should start with choosing a career that you will like. If you like what you do, you will probably be good at it and become successful.

  3. Jon @ MoneySmartGuides says

    I’ve always looked at my career as an investment. I continue to take classes and attend seminars to make me as valuable as I can be so I can get the most pay possible.

    I worked with someone who hated their job and wanted nothing more but to get laid off. He was smart in that he invested in the company stock program his full 15 years while at the company so that when he finally had enough, he quit and used the money in the stock to pay off his mortgage. While he isn’t set for retirement and needs to work, he at least took advantage of the time there and the benefits the job offered.

    • Kevin Mercadante says

      Hi Jon–In a way both you and your friend were investing in your careers, though in different ways. That also highlights the periferral investments that come with a career, like the 401K, company stock and sometimes stock option. This highlights how your career is the foundation of all of your investments.

  4. Cherleen @ My Personal Finance Journey says

    I totally agree. We should invest in our career to stay on top of our career. I remember when I was young and deciding which college course to pursue, my dad told me to choose a career that I love, where my passion is, so that I will not feel the stress and burden of the work that I do. Based on my experience, I also realized that continuous learning is one of the main keys on staying ahead of your colleagues. We should not be complacent because we live in a changing and ever dynamic world.

    • Kevin Mercadante says

      Hi Cherleen–That’s so true. So many people want a job that can be run on automatic pilot but those days are gone. We all need to stay on top of industry developments and what we need to stay competative. It may mean more pressure, but what’s the choice? If we can think of it as investing in our futures it may not seem so disruptive.

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