Money

Delayed Gratification

So far in this series, Let’s Get Critical, we’ve discussed what critical thinking is, how to use it at work, and how to demonstrate it to further your career. Let’s wrap up this series by applying critical thinking to managing your money.

Save

Now – Whether it’s a broken tooth or a broken car, you should have immediate access to $1500 to pay for unexpected expenses. You can apply critical thinking to save up an emergency fund. For example, most banks offer multiple accounts so you can segment your money for specific purposes. In addition to a debit account, open an adjacent account and label it Emergency Fund. Set up an automatic transfer of $25 a week from your debit account to your Emergency Fund. In one month you will have saved $100. In 14 months you will have saved $1500. Yes, it’s a long time. If you can save more aggressively, plus earn interest on the Emergency Fund, then you can do it faster.

Soon – If you’re dreaming about an extended vacation, planning to purchase a vehicle, or want to own your own home, critical thinking helps you break down your goal into manageable chunks, establish a timeline, and calculate how much you need to save each month to achieve it. For example, if you’re saving for a $20,000 down payment on a house within two years, you’ll need to set aside approximately $833 each month.

Later – For eventualities like retirement, critical thinking makes you consider factors like inflation, investment options, and your desired lifestyle in retirement. While you can’t predict the future, you can estimate how much your expenses will be and work backward to determine how much you need to save each month to reach those goals. Then you can research investments like IRAs, or 401(k)s and weigh their benefits against your risk tolerance and at what age you want to retire.

Spend

Budget – Pay attention to where your money goes by tracking your spending. This can be as simple as a weekly check of the transactions in your debit account on your bank’s app. Occasionally, maybe quarterly, pull data to see where your money goes over time. For example, do you spend more in the winter? Is it because of heating costs or holiday gifts? What expenses are non-negotiable? What extras can you cut back on without resentment? Armed with this analysis, critically think about where to adjust spending so you can strategically allocate funds to cover both essential expenses and discretionary spending.

Insurance – Just like you have to save for emergencies, you also have to spend for them. An emergency fund helps you pay for minor emergencies. Insurance protects you against major emergencies that could financially ruin you. Critical thinking means you stop and think about what you need to protect. Usually this includes your health, vehicle, and home. Now, how much protection do you really need? How much risk can you afford? Compare plans and premiums to balance cost with comprehensive protection.

How do you apply critical thinking to your money management? Please share in the comments.

Cover Your Assets

Cybercriminals are increasingly sophisticated. As technology advances, so do the tactics they use to steal your identity during tax season. Since the consequences of not filing income taxes are rather unpleasant, how can you prevent becoming a victim?

File Early

The Internal Revenue Service (IRS) encourages early filing as a preventive measure against identity theft and tax fraud. When you file early, you reduce the window of opportunity for scammers to impersonate you. Consider filing your taxes as soon as you receive all your statements like: W-2s, 1099s, and tax deduction records. Here is a full list. If a cybercriminal steals enough of your Personally Identifiable Information, (PII) then they can use it to impersonate you, file tax returns, and claim your refunds. You can beat them to the punch by submitting your legitimate returns as soon as possible. This also allows you to address any discrepancies on your return with the IRS before fraudsters can exploit them.

If Someone Files for You

If you choose to enlist the help of a tax preparer, ask them about their data protection practices. How do they ensure the security of your PII? When a tax professional fills out your return, you have to trust them with most of your personal and financial data, so do your research. Read reviews and get referrals from people you trust. Does the tax preparer comply with industry standards and regulations regarding the handling of sensitive financial information? What are their professional certifications? Are they members of reputable organizations, such as the National Association of Tax Professionals or the American Institute of Certified Public Accountants? While not a guarantee, these affiliations expect adherence to strict ethical standards and data protection guidelines. When you do select a tax professional, before turning over any PII, ask about their security measures for safeguarding client information. A trustworthy tax preparer should have strong data protection policies like encryption protocols, secure file storage, and restricted access to client files.

If You File Your Own

Network: When filing your taxes online, make sure to use a secure and password-protected internet connection. Do not use public Wi-Fi networks to file. They are notorious for their lax security measures. Hackers love taking advantage of them.

Software: Make sure your computer’s operating system, antivirus software, and tax preparation software are up to date. Regular updates often include security patches that protect against known vulnerabilities.

Passwords: Use complex passwords for your online tax accounts, and avoid using the same password across multiple platforms. You know the drill. Your password should contain an uppercase letter, a number, a special character, and a haiku. Just kidding. A combination of letters, numbers, and special characters will do the job.

Authentication: Many tax preparation platforms offer Multi-Factor Authentication for an added layer of security. Even if it means waiting for a code to arrive on your mobile device, it is better to be patient than hacked.

Phishing: Think before you click on links or open attachments to emails whose subject lines say they are about your tax filings. Phishing scams mimic official communication from tax authorities and look extremely authentic. They can deceive you into unwittingly and unwillingly disclosing your PII.

How will you safeguard your PII this tax season? Please share in the comments.

Degrees of Income

This is part four of four in the series: Independently Owned and Operated.

I talk with businesses who need talent and I talk with people who have it. Sometimes one of the obstacles connecting the need to the resource is the hiring manager’s requirement for an advanced degree. So, ZipRecruiter’s 2023 first Annual Employer Survey got my attention when I read that in 2022, 18% of job descriptions listed on their site required a bachelor’s degree. That percentage decreased to 14.5% in 2023. Why?

Skills or Degrees?

Small and midsize businesses (SMBs) lead the change. ZipRecruiter’s survey says 47% of SMBs in the United States dropped their degree requirements last year, which makes sense because SMBs were harder hit by hiring challenges. Whether you are an SMB or enterprise organization, if you drop degree requirements, then you have to have a way to verify the skills candidates list on their resumes. This adds a new dimension and expense to the hiring process. Employers may need to purchase skills assessment software to evaluate potential hires’ competencies and job hunters need to be prepared to prove their proficiencies in real time.

Drop or Train?

ZipRecruiter’s study found both healthcare and education eliminated degree requirements for some of their open positions. For example, in healthcare, positions like pharmacists and home health care aides dropped degree requirements. But healthcare is a highly regulated industry with mandatory licensing for some positions. The solution? Employers helping employees obtain the required training and licensing. As for education, last year there were three highly-publicized strikes over issues of large class sizes, salaries not keeping up with the cost of inflation, and lack of resources. While lawmakers, school officials, and unions work to transform the K-12 education system nationally, the teacher shortage is already forcing schools to employ substitute teachers who don’t have teaching credentials. Removing degree requirements from some job descriptions is a reflection of what is already happening.

Now or Later?

For employers, hiring for power skills then paying for technical training seems to be the most practical solution. The question for job seekers is: Should you opt for a short-term certification or pursue a college degree?

Employers want a combination of technical expertise and power skills including communication, problem solving, and leadership abilities. In training for a certification, best practice is to already have those skills. These power skills are often developed through a college education.
Skills-based credentials focus solely on technical competencies and become outdated as technology advances. A degree program focuses on a broad range of knowledge, critical thinking skills, and exposure to diverse perspectives.
Short-term certification programs help you meet the current expectations of an employer. Colleges and universities connect you with professors, alumni, and industry professionals. These connections can lead to internships, job opportunities, mentorship, and impact long-term career advancement.

A short-term certification offers an immediate solution. A college degree builds for a future beyond your first full-time job. Employers willing to drop degree requirements and help with mandatory licensing will cultivate a loyal workforce. Employees opting for technical certifications now can revisit the option of getting a college degree as their careers progress.

Do you have a college degree? If so, what financial impact has it had on your career? If not, same question. Please share in the comments.

Working 5 to 9

If you received an inheritance, have passive income, or won the Powerball, yay you! But plenty of people seek additional employment to pay bills. Whether you refer to it as a side hustle, moonlighting, or a gig, as of April 2023, 39 % of Americans have one. Why do employees work side gigs? Why are employers concerned when an employee has one? What can both do to alleviate those concerns?

Why Employees Work Side Gigs

Finances – The cost of living keeps going up and as of March 2023, only 87 % of full-time private industry workers had access to medical care benefits. Self-funding health insurance, retirement, upskilling, etc., may not be possible with income from one full-time job.

Passion – The gig economy offers possibilities for personal growth. For example, maybe you are a teacher who loves baking and you have a side hustle making special occasion cakes. Experiments combining flavors and coming up with original designs is a creative outlet.

Development – A side gig is an opportunity to develop additional skills. For example, maybe you are a software developer who loves writing and you have a side hustle blogging for a website. Sharing your knowledge can establish you as a subject matter expert.

Why Employers Get Concerned

Conflict – An employee may end up working on projects that directly compete with yours. This results in divided loyalty and compromises the employee’s ability to prioritize and dedicate their full attention to the work they do for you. There is a risk that the knowledge, skills, or innovations they gained working for you could contribute to a competitor’s success.

Liability – If an employee’s side gig is in a similar industry or involves activities that could potentially harm the company’s reputation, you may be responsible for any consequences including financial repercussions.

Productivity – Employees with side hustles may find themselves stretched thin, leading to a decline in overall job satisfaction and eventually burnout. Side gigs may create tension among team members, especially if some employees feel burdened with extra responsibilities or perceive others as not fully committed to the team’s goals. This makes retaining your employees difficult.

How Both Can Come Together

Communicate – Employers should establish clear boundaries and written guidelines to ensure side gigs do not interfere with job responsibilities, deadlines, or the cohesion of the team. This will help maintain trust and prevent misunderstandings. Speaking openly of the side gig in regular check-in meetings promotes accountability.

Motivate – Employers can reap certain advantages from employees with side gigs. So, it’s crucial employers understand why their employee has one. Employees actively pursuing their passions outside of work find renewed inspiration and creativity. This positively impacts their job performance and helps employers retain a diverse and engaged workforce.

Innovate – Employers can embrace the concept of “intrapreneurship.” When employees channel their entrepreneurial spirit within the organization, employers can grow a dynamic and forward-thinking workplace culture. Employees with side gigs often bring new skills and experiences to their primary roles, fostering an environment of innovation and adaptability within the workplace.

Employers have legitimate reservations about their workforce engaging in side gigs. It’s essential to recognize that not all side gigs pose a threat to the employer-employee relationship. The nature of work evolves daily and business moves at the speed of trust. Tools like communication, empathy, and flexibility are necessary to help your organization thrive.

Do you have both a full-time job and a side gig? How do you make that work? Please share in the comments.

Your Top 12

Thank you for spending 2023 with me! As we begin a new year together, here are the top three articles in each category: Time, Energy, Attention, and Money (T.E.A.M.), based on the most views.

Time

Energy

Attention

I appreciate you discussing these topics with me in 2023. I hope you found them useful. There are more in store for 2024!

What decisions around time, energy, attention, and money are you facing in the new year? Please share in the comments.

The Catch

Here in the technology space there is a lot of murmuring around unlimited Paid Time Off (PTO) as an employment benefit. As of October 1, 2023, 43.16% of job listings in the technology sector offered unlimited PTO. Is it the answer to better work-life integration and increased job satisfaction?

Employers

Productivity: You want to enhance employee well-being, but unlimited PTO inherently carries the risk of abuse. A sudden surge in leave requests can halt delivery on a contract. Traditional PTO policies provide structure for you to manage workloads effectively. With unlimited PTO, how do you both anticipate and mitigate potential gaps in staffing? How does this unpredictability affect project timelines?

Policy: The absence of a clear legal framework can lead to potential disputes with your workforce. The United States does not legally require paid time off for workers, so it is a business expense for companies that offer PTO to employees. Unlimited PTO must have an expiration date so you can budget. Many states expect businesses to pay out earned time off when an employee leaves the organization. In August, CBS News reported that American companies are carrying about $224 billion in liability for employees’ unused PTO. If employees are not earning PTO, then companies do not have to pay them for what they do not use. How will you address employees’ expectations of getting paid for unused unlimited PTO?

Employees

Panic: How do you know how much time off is too much? Last March, Forbes found that employees with unlimited PTO only take 10 days off annually. Why? Fear, too much work to do, and pressure from their managers because of the timing. When employers do not have rules around PTO, every request is a negotiation and instead of a contractual term of employment, time off becomes a moral issue. Can the company afford to pay you to not work? If your manager thinks you take too much time off, does that negatively impact your next promotion?

Peers: You may feel compelled to match your teams’ work habits. But accumulating significant amounts of unused time off can lead to burnout. Do your coworkers grumble about filling in for you? Will you be labeled a slacker if you take extended time off?

Both

Expectations: The goal is to balance the employer’s need for productivity and the employee’s desire for flexibility. Establish transparent guidelines outlining expectations for both individual contributors and managers. Clearly communicate that taking time off is not only acceptable but also encouraged for maintaining healthy boundaries.

Check-In: Schedule regular check-ins to assess workloads, stress levels, and job satisfaction. Encourage open communication between teams and managers to address concerns and prevent burnout.

Train: Equip managers and individual contributors to effectively navigate the challenges of unlimited PTO policies. Help supervisors acquire skills to manage workloads, plan for time-off coverage, and create an environment that values both productivity and employee well-being. Clearly communicate unlimited PTO policies to your workforce.

Adjust: Conduct periodic reviews of the unlimited PTO policy to assess its impact on productivity and employee satisfaction. Employers need to be willing to continuously improve the policy based on employee feedback and changing organizational needs.

While unlimited PTO seems like a perfect solution to work-life integration, it comes with its own set of challenges. Striking the right balance between flexibility and productivity requires thoughtful implementation, clear communication, and a commitment from both employers and employees to make it work.

Does your organization offer unlimited PTO? Please share your experience using it in the comments.

Reimagine Compensation

The United States Internal Revenue Service defines full-time employment in terms of hours. Their standard is an average of 30 hours per week or 130 hours per month. You can sit at a desk for those hours and wait for the email notification to ding, but is that productive? If you secure a new customer over a lunch hour, do you have to work another 39 hours that week?

Tradition

Rooted in the labor movements of the 19th and early 20th centuries, the 40-hour work week was established to protect workers from exploitation, ensure work-life balance, and promote economic stability. Technology, remote and hybrid work arrangements, and a shift in how we measure productivity, makes this rigid structure unsuitable for a wide range of jobs and industries.

Transformation

Employees are increasingly prioritizing autonomy while employers are increasingly recognizing the value of results over hours logged. The result is transforming the way employees are compensated. Instead of being paid solely for the number of hours worked, employees can be compensated based on their skills, the networks they bring to the organization, and the outcomes they deliver. For example, freelancers, gig workers, and project-based contractors are compensated for completing tasks, the quality of their output, delivering specific results, and the impact on the organization’s success, rather than for a set number of hours worked. This approach aligns more closely with the idea that the value an employee provides to the organization is not solely a function of their time, but the quality and impact of their work. We talked a couple of months ago about how being busy is not a reflection of productivity. With the aid of technology, it is now easier to track and assess work progress and results, no matter where, when, or how an employee chooses to work. Key performance indicators (KPIs), project milestones, and deliverables are more significant in assessing an employee’s productivity rather than the mere number of hours spent at a desk.

Transition

In a traditional office setting, it’s easier to monitor and manage employee performance, but in the age of remote work, new methods and tools are required to maintain accountability. Here are some basics.

Trust and Flexibility: While accountability is essential, micromanaging erodes trust and hinders productivity. A results-oriented approach, where employees are given the autonomy to manage their own work, can be highly effective.
Clear Expectations: Work together to define realistic goals, deadlines, and deliverables. Then evaluate employees based on objective performance metrics like goal achievement, quality of work, and impact on the organization.
Technology and Tools: Time-tracking software, project management platforms, and communication tools are invaluable for keeping remote workers on track. Frequent check-ins, whether through video calls, phone conversations, or written updates, can help maintain both connection and accountability. These interactions allow employees to discuss progress and challenges, and receive feedback and guidance.

The demise of the 40-hour work week is not the end of structured work but a transformation that better aligns with the demands and opportunities of the modern workplace. As remote and hybrid work arrangements become more prevalent, a new model of compensation and productivity measurement emphasizing flexibility, autonomy, and results ultimately benefits both employees and employers.

If you are not paid for your time, then by what measure do you get paid? Please share in the comments.

Let’s Confer

Your inbox is overflowing with tempting invitations to register for conferences. Your training budget is tight to non-existent, so why should you spend money to attend a conference? Maybe you shouldn’t. What benefits would you receive? What criteria should you use to evaluate whether or not to attend a conference?

Benefits

Knowledge Sharing: The world of work is constantly evolving, and it’s crucial to keep up with the latest trends and tools in your industry. Conferences are a hub of knowledge. They offer opportunities to learn from experts through keynotes, participate in hands-on workshops with your peers, and gain insights into cutting-edge technologies from vendor demonstrations. Conferences provide a platform for you to both expand and share your knowledge.

Networking: Every industry thrives on connections and collaborations. Conferences intentionally bring together professionals, thought leaders, and peers to give you time and space to interact. Meeting like-minded individuals can lead to valuable partnerships, job opportunities, and mentoring relationships. Engaging with professionals who share your interests can provide fresh perspectives and inspire new ideas.

Advancement: Investing in a conference should be a strategic career move. Many employers view participation in conferences as a sign of commitment to professional development and growth. They can be an opportunity to present your work, which can enhance your reputation within your industry. Exposure to a wide range of concepts and specialists can open doors to new career paths and opportunities.

Inspiration: Hearing success stories, attending keynote presentations, and participating in brainstorming sessions can rekindle your passion for your work and remind you of the bigger picture. Conferences can help you stay motivated and engaged.

Criteria

Relevance: Before committing to a conference, ask yourself how it aligns with your goals. Is the event focused on a relevant topic you want to learn more about? Does the conference’s content match your professional development objectives?

Quality: Check out the schedule of speakers and breakout sessions. Are subject matter experts presenting? Look for sessions that promise valuable insights, practical knowledge, and interaction. A well-curated lineup can make a significant difference in your conference experience.

Location: Map the conference’s location. Is it in a city with convenient transportation options? Can you easily attend without disrupting your work and personal life? Sometimes, local conferences can be just as valuable as international ones.

Cost: Evaluate the cost of attendance, including registration fees, travel, accommodation, and meals. Compare this cost to the potential value you expect to gain from the conference. Remember that the benefits, such as networking opportunities, knowledge acquisition, and career advancement, can often outweigh the financial investment.

Reviews: Are survey results or testimonials from past attendees available from a source other than the promoter of the conference? Research the conference’s social media platforms for comments on past events. This feedback can provide valuable insights into quality and whether this conference aligns with your expectations.

Support: Discuss the conference opportunity with your employer. Some companies have budgets for upskilling. Ask your manager if attending this conference qualifies for continuing education dollars. Highlight the potential benefits to your company, such as the knowledge you’ll bring back to share and new partnership opportunities for the organization.

Investing your money in attending conferences is a strategic move that can propel your career forward. Attending the right conferences can be a transformative experience that equips you with tools, connections, and insights to thrive in the constantly evolving workforce.

What conferences did you attend this year? Were they a good investment? Please share your favorites in the comments.

Bad Reputation

When you think of Sales, does it conjure up a vision of a used car lot and an overexcited man in an ugly plaid jacket? No? Just me? Okay. As a profession, Sales has a bad reputation. Sales people are stereotypically portrayed as fast talking deceivers.

But, everyone in the workforce is a salesperson even if the word Sales is not in your job title. People associate you with your organization. You have the power to help and hurt your employer. If you enjoy working for your organization, then you will speak highly of it to others. If you don’t, you won’t, and people notice both. For example, let’s say you are a hygienist for a family-owned small dental practice. The next time your friend from the gym has a toothache, will they call your office because you speak so highly of it? Or will they avoid it because you complain?

For this conversation, let’s pretend you are the hygienist mentioned above. You like your job well enough to speak favorably about it and you are not in a sales role. Your success not only depends on your performance, but also on a steady stream of patients. How can you help the business grow even though you are not responsible for attracting patients?

Relationships

Sales skills are communication and caring skills. In our hygienist scenario, you do not have sales goals to meet. This gives you the luxury of being able to take as much time as you want getting to know people and when they need dental services, they will call you. So, when you have face time with friends and family, listen intently and actively. Put your phone upside down on the table and look them in the eye. Do not interrupt their story. When they pause for your response, wait a second to indicate you really heard them, then ask an insightful follow up question to prove it. Great questions lead to great answers. Even just a, “Say more, please,” demonstrates your interest and empathy. When people feel listened to, they feel understood and validated. When they feel understood and validated, they like you. When they like you, they trust you and business moves at the speed of trust.

Experience

When it’s your turn to talk about yourself, it’s natural to talk about your work. In our hygienist example, you may have an anecdote about a one-year-old child’s first trip to the dentist and how you made them feel so at ease they did not want to leave. Then ask your friend what is going on at their workplace. This prompts them to share a success story too. The positive conversation makes you both want to have future interaction, so be sure to follow up. Strive to make people feel comfortable and respected. Show you care about them as a person. Take opportunities to tell stories of how people feel safe with you and how your organization makes their lives both better and easier.

Honesty

Being honest is integral to building relationships and establishing it takes time. Think about a potential client. If you were in their shoes, how would you want to get to know your product or service? What would make you feel respected during the customer journey? In our hygienist example, if you are having coffee with a friend and they mention they are embarrassed by their coffee-stained teeth, do you have a story about a happy customer who had whitening done? Can you suggest an over-the-counter solution they can try first? You aren’t selling your services, you are solving their problem. Steering someone away from your service actually makes it more attractive. You are proving that you value their relationship more than their money.

How do you feel about attracting people to your organization? Please share in the comments.

Site Inspection

Last week, we looked at some ways employers can begin to solve the working remotely challenge. This week, let’s discuss your role. As an employee, you have a few questions to contemplate. Does your organization consider working remotely a privilege or a right? Are you willing to take a pay cut to work remotely? What message are you sending to your managers? Is it clear, kind, and collaborative?

Both employers and employees require communication, empathy, and flexibility to effectively negotiate. This week, let’s think about what constructive steps employees can take to help build a bridge across the working remotely gap.

Communication

Build your case for working remotely. You can include why it is best for you, but put more emphasis on why it benefits both your manager and your organization. For example, working remotely reduces your commute time. This is good for you because it saves you money. It’s good for your manager and your organization because you can spend that time working instead of commuting.
Provide data that supports your case for remote work. Pull up your Atta Baby file. Do you have any documentation of your increased productivity, successful project outcomes, and positive feedback from colleagues and/or clients from March 2020 to the present?
After gathering your evidence, schedule a meeting with your manager. Clearly and calmly present your case. Give brief illustrations of how remote work has positively impacted your work quality, efficiency, and overall well-being. Then actively listen to your manager’s perspective. Understand their reasons for wanting you in the office full-time. This can help you find common ground and empathize with their concerns.

Empathy

If your manager has specific doubts about you working remotely, address them directly. For example, if they’re worried about collaboration, share how you plan to stay connected with colleagues and contribute to team projects while off site.
Highlight how you’ll maintain accountability and meet your metrics. Describe to your manager how you’ll be available, responsive, and productive. For example, someone who emails you with a simple request on a Wednesday at 8:00am can expect a reply from you within thirty minutes.
Be receptive to your manager’s feedback and open to adjusting your proposal based on their input.

Flexibility

Suggest compromises that address both your needs and your manager’s misgivings. How about a hybrid schedule where you’re in the office for certain days or specific team meetings?
Suggest a trial period for this arrangement and ways to both evaluate its effectiveness and make adjustments as needed.
If the conflict remains unresolved, consider involving Human Resources to mediate. They can provide guidance on the interpretation of your organization’s policies.
If you and your manager come to an agreement, document the details in writing to avoid any misunderstandings later.
If you do not reach an agreement, that gives you valuable data. It shows you what your employer expects. It also reveals the conditions under which you are willing to work. You can use this information to make decisions regarding your future with this organization.

The goal is to find a solution that benefits both you and your employer, and meets the needs of your team and your organization. Effective communication and a willingness to compromise are essential for reaching a resolution that everyone can support.

How is working remotely affecting your work life integration? Please share in the comments.