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Hitesh Porwal

Executive Coach | Wealth Coach

2 November2018

An average person, for more than 40 years, spends more than 70% of his/her waking hours towards earning money. This is the time we spend in our respective occupations, be it a job or a business.However, even after spending so much of time and effort, financial independence is not guaranteed to the majority. And the situation is not getting any better in near future.

To resolve this, some deliberate intervention to students is required, at the threshold of admission into colleges so that they are well equipped to enter the real time economic marketplace.

Next in the list to sleeping, occupation is the most time consuming activity of our lives. Everyone understands the objective of sleeping; it is a physical necessity and requires no effort. But what is the objective of occupation which takes up so much of our time and effort? Unlike sleeping, occupation cannot be classified aphysical necessity. It is instead a derivative (you got it right, I am from financial marketsJ) for achievinga hierarchy of underlying objectives. There could be some overlap of one step to another but mostly these are successive in nature:

🔴 Earn a living- acquire basic necessities like food, clothing and shelter

🔴 Buy comforts – own home, car, health insurance, good education, vacation

🔴 Achieve Financial Independence- A state wherea person can stop working butis still able to support his lifestyle through earnings from personal assets and savings

🔴 Buy luxuries

🔴 Give back to the society

Though all five objectives are worthy of pursuit, achieving the first three is the minimum expectation out of one’s occupation because once the first three objectives are achieved, financial independence is achieved. And, the pursuit of the next two after this will make you “wealthy.”

The real question is how many people are actually able to achieve the first three objectives through their occupation? There is no central study to find the exact number, but a conservative estimateat global level puts it at less than 10% of the entire population. In other words, 90% of the people, even after working for 40 years aren’t able to achieve the bare minimum goal through their occupation. By any standards, this is a serious issue as it impacts the standard of life of 90% of the people on this planet.Though we can look for its causes and solutions in various directions, let’s focus on the role of an individual in ameliorating his/herown situation.

Before joining an occupation, an individual generally spends a good amount of time in gaining formal education. In an ideal world, the education system can be super responsive to understanding needs and automatically adjust the curriculum accordingly thereby channelizing workforce into relevant streams (across skilled, unskilled, employees, entrepreneurs, self-employed) so that they fit into the real time economic system and achieve their occupational objectives.But,we don’t live in an ideal world; you cannot wait for the education system or for that matter any other system to catch up with your needs fast enough. Thesesystems are behemoths and by nature they move slowly.

So what can you do?

Starting early gives you an edge over others. As soon as you join college, take charge of your career immediately, and also take personal responsibilityof your occupational and financial goals.Understand that the odds are stacked against you, and gaining automatic success or getting lucky is a myth. Be absolutely certain before committing the next 4-5 precious years of your life to pursuing a qualification which may or may not help you achieving your occupational goals.Blaming any system, be it educational, political, social or economic for non-achievement of your goals is not an option.

Your primary target should be achieving financial independence by fulfilling the first three objectives mentioned above. There are multiple ways to skin the cat and achieve that goal. Here are three primary ways.

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First, you can chase your dream idea with everything you have; time, effort, money, and make it a reality. It could be an innovative idea coupled with entrepreneurial perspective that solves a customer frustration or problem, which no one else has thought of before. Keep in mind that this is a high-risk high-return proposition. But it is also the fastest path. Majority of the self-made millionaires took this path to success and wealth.

Second, you can aim at achieving excellence in your business, profession or job. This will require you to acquire relevant expert knowledge or skills that people will be ready to pay a premium for. You can achieve it either through a high-paying job with a corporate, or in your own profession like medicine, law, art, and so on, or through your own business. Continuous learning, focus on personal development and building expertise are hallmarks of this approach. I personally adopted this path for the first half of my professional career before moving to my dream idea. 

Finally, you can also reach your goal by getting into the habit of saving, and by maintaining a humble standard of living. If you can save up to 10-20% of your income consistently, and generate average returns through smart investment in the financial market, you will achieve financial independence. But be aware that this is the longest route to your goal than the other two.

Having considered all the options, keep one thing in mind that earning wealth is no short-cut business. Every option takes considerate time and effort, so keep patience. With that in mind, take up a thorough self-assessment of your strengths, weaknesses and interests to recognize which path best suits your personality. If you believe that you are passionate towards a continuous learning process and want to scholar in your field, go for it.  But don’t fall prey to the mob mentality and become part of the flock, instead, evaluate your position within the crowd, and then place your bets where the odds are high.

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How do you find where you stand in the crowd? If you are not amongst the top 10% in a given stream or subject, you need to re-evaluate your passion for that stream and question your future in that stream.  If a particular subject doesn’t interest you or if you are not content with a particular lifestyle that a career would lead to, don’t continue pursuing it or living it only because this is what your parents had dreamt for you or your father’s best friend had advised for or that a majority of your friend circle is pursuing it. 

“Develop an internal alert system to question every time you see yourself part of the ‘majority’”

If you find yourself incapable of performing the self-assessment, seek professional help. I have often found that a few thousand rupees spent on a counsellor or someone who could help you find your true passion and strength goes a long way. It is one of the best investments you’ll ever make in your life.

But this is not the only resort, these days you have a multitude of alternatives which can help you find about your interests, for instance, tracking relevant blogs, joining online forums, etc. You can also work part time in the field of your interest to evaluate if you fit there in real time or intern for a few months in the company or industry you are passionate about. All this might sound unusual initially, but it is only to guarantee success of your financial goal.

I am not at all discounting higher education especially if you are a really good student in a technical subject and arepassionate about it. I am only implying that be definite about your passion before committing four or five precious years of your life pursuing that field of study.  Because, in present day world, the linear relationship: good education leading to good job leading to good wealth leading to happy life is no longer valid.

In addition to self-assessment, check your spending during your college years to avoid credit card debts later. Debt is much more than a number. Studies show that 67% of student loan borrowers suffer from physical symptoms of financial stress (https://studentloanhero.com/press/student-loan-borrowers-suffer-physical-symptoms-financial-stress/). You can’t afford to be stressed right at the beginning of your career.

Finally, whatever stream you choose, once you start earning, develop the habit of saving and investing as much and as soon as you can. Be an aggressive and early saver, even if that means avoiding the fun and frolic of today for a few years. Every extra year of early savings and smart investing is worth gold for fulfilling your occupational objectives.  The effect of compounding and capturing market cycles will act like magic in achieving your objectives if you start early.After all, you don’t want to ignore the teachings of Warren Buffet, do you?

Wishing for the best is good but planning is better!