This blog is about investing in stocks so you become financially free.
What does that really mean? Do you invest so that you can laze around on the couch all day and let other people do the work?
No, not at all.
You can use stocks as a tool to get a better life with a better variety of choices. This eventually means you can use stocks as a tool to get a better career. How can investing help you create a better work life with richer opportunities?
I’ll show you how by giving you three examples from my own career of what NOT to do – and what to do instead.
1. You Have More Guts
The biggest mistake I made in my previous career (I was a business journalist in my previous life) was not setting clear boundaries in my job.
There was a specific situation where I should have resigned on the spot. I had applied for another job at the same newspaper. The business editor got word of it and was very upset with me for wanting to leave his section of the paper. He called me into his office and declared two things.
A. He didn’t recommend me for the position.
B. From that day on, I was covering the retail sector instead of banks – which was a clear demotion.
It was such a vindictive and unjust act, and I should have left the paper on the spot. Yet, I didn’t.
I swallowed the humiliation and went back to work. I didn’t even express my dissatisfaction to coworkers. Why? Because I was afraid. I feared losing my monthly salary. I depended on it.
If I had been financially independent, I would have made bolder moves – and in that particular situation, resigned right there in his office. Before leaving I would have had a word or two to say about it.
What about you? If you didn’t have to, would you still keep the job that you have today?
2. You Can Take a Sabbatical Year to Study and Improve Your Skills
If you are financially independent, you can take a year off to refine your skills – or to study something new.
About 10 years into my career, I began dreaming of applying for a fellowship in business journalism (the Knight-Bagehot Fellowship). It remained a thought – I never applied. Why? Because the financial implications of studying and living in New York for a year (which I had already done once in my life) seemed financially crippling.
Yet, in hindsight, it would have been exactly the right move at the time. It would have given me time to reflect and gain new skills, new ideas, and inspiration. Who knows, maybe I would have stayed in the US where the opportunities were richer.
Most people don’t take time mid-career to refine or renew, exactly because of the financial obligations that they have. They have mortgages to pay and have somehow become dependent on having a decent monthly salary.
If you could take a year off to study anything you want, what would you study?
3. You Gain Tools to Analyze Your Employer
When I found myself facing a dead end in my career as a newspaper journalist in Denmark, I hired a coach to figure what to do about it.
I spent hours explaining what had happened at work – in particular my power struggle with the business editor – which felt like an entangled knot that I couldn’t quite figure out how to unwind.
After several sessions, the coach asked me one simple question: “Would you consider working in an industry that isn’t in decline?”
I was taken aback by the question.
I was expecting my coach to concoct a complicated strategy to overcome the obstacles and power struggles so I could prosper and succeed. Yet he thought I should catapult myself out of there.
He went on to explain that it’s a hopeless battle to try to make a career in a world of dying dinosaurs. You’ll get trampled as they stumble and fall. Industries and companies in decline make terrible workplaces. It’s far easier to have a great career in a company in the early stages of growth.
I already knew that print papers were struggling, but for some reason I hadn’t connected the dots to the challenges that I was experiencing myself. I was so focused on studying my situation through a magnifying glass that I had forgotten to take a ride up the elevator to see the problem from a distance.
When you invest in an individual company, you’ll look at the annual report and make sure it’s a company with growing sales and growing profit. If it’s not, you should stay away from investing in it.
It’s really important to have a bird’s eye view of the company you’re considering buying stocks in.
You have to assess whether you’re dealing with the best company in the sector, and whether they’ll grow to be even bigger the next decade or two.
I would never have invested in a local-language print newspaper with diving subscriptions, an endangered customer base, and an outdated business model giving customers the news a day after the rest of the world.
Then why would I devote my life to it?
What about you? Have you considered whether you would invest in the company you work at? Have you analyzed your own employer?
You can learn more about how to analyze companies in my e-book Free Yourself here.
Don’t forget the e-book Free Yourself. It’ll teach you how to calculate how much a company is worth. You can get it for free here.