Tag Archives: economy

Resilience in Times of Economic and Career Crisis

I received the following Facebook message from someone I went to High School with today:

Nicole,

I am finding that my motivation to do my job is falling off little by little every day and the push to keep going and insure I am the best is becoming a greater challenge every day.

I am telling you this in hopes that you- one of the very few people who may understand my mentality that anything short of the best is not good enough- could offer some words of wisdom or bits of advice on how to push through it.

I find myself day dreaming of what it would be like to have a normal job, one that does not include the responsibility of keeping others employed, or having to continuously be an ass, or worst of all put up with two moron bosses that never communicate. You know, the kind of work where I have a few simple tasks a day and maybe a slightly difficult decision from time to time, and then I can go home to an average life…

Well hopefully you have some words of wisdom, because I’m running out of them…

-C.

I asked my friend if I could use his message for a post, because I’m almost positive a majority of twentysomethings feel hopeless about their job and career path at times.

First, the news has becoming depressing. Hearing about friends and family members losing their jobs and getting pay cuts is sad. Feeling the slow down of being in an industry that is highly dependent on the economy is scary. Seeing huge financial institutions fail, and their CEO’s making millions of dollars a year is bizarre. The fact that America is now considered “debt nation” and the government has to bail us out is awful. All of this “doom and gloom” has probably led many people to a small case of temporary depression!

As far as offering advice to this common situation, my first suggestion would be to take a few days off. Or maybe more if you can. Perhaps a little vacation would give you time to get your head together and either cope with the situation or pursue a new path.

Second, if you’ve determined that you are truly miserable accept that only YOU can change your situation. This may require going back to school, moving to a new city, quitting your job to pursue a new one, etc. Usually you will know if it is time to take the leap. My guess is that you will feel a million times better once you do.

Lastly, I think C.’s email brings up a VERY important topic: resilience. When talking to my business partner, Blake, over the weekend we emphasized how important this trait is when facing the challenges of building a solid business or career. If it were easy, everyone would be doing it- right? C. mentioned that “anything short of the best” is not good enough for him. If that is the case, he may need to accept that either a. he is not in the right job at all, or b. that being the best, or accepting the most difficult challenges are usually the most daunting and the least fun.

So why is resilience so important? Resilient people bounce back and don’t quit or give up easily. Their ability to keep going will eventually lead them to success. Resilient people can thrive and progress in difficult circumstances, and tend to get ahead when less adaptable people won’t.

After receiving C’s message, I wrote back and asked if I could post a response to his dilemma. He agreed and then wrote the following:

I asked my friend yesterday if he thought what is going on around us right now will affect the way our generation saves, works, changes… The way I see it is that we turning into our grandparents’ generation, that of the depression era. The mentality of working until your eyes are burnt, fingers are bleeding, and thoughts are worthless all to go to bed and wake up the next day to do the same thing. And for what? The fear that we will lose our jobs and be out of work for years to come?

That is a very interesting question that I hadn’t thought about before, but really it makes perfect sense. Living our twenties-a vulnerable time period in it self- while in a time of economic hardship and turmoil must affect the way we handle risk, finances and career choices. It seems that many of us are becoming paralyzed by fear, and therefore settling in many areas of our lives. It sounds like people like C. are hoping to hold on to anything that is stable and secure, even if it makes them feel like they are dying inside.

Gen Y is said to be a self-centered, free thinking and entrepreneurial generation. It’s almost ironic that Gen Y is also living through the present conditions we are. Perhaps it’s a big lesson we needed to learn.

Either way, my advice is to make choices that make you happy and keep looking forward. Be resilient and know that we are only in our twenties and have the rest of our lives to pursue more glamorous ventures.

Good luck to C and all others who are feeling this way!

Checking in on Your 2009 Goals and $10 a Day

So it’s already February, and I have to ask:  how are those New Years’ Resolutions and 2009 goals going?  Most people fall off the wagon 6 weeks into the New Year.  Don’t let it be you!

 

Most of us (me included) set goals to get financially AND physically fit this year.  It’s not as easy as it seems, is it?!  Well, I’m here to be the annoying person who gives you your February “Reality Check” to help you stay on track. 

 

I was scanning my book shelf the other day to gather ideas for this post and came across Jean Chatzky’s book, “Pay it Down,” which I purchased at the peak of my over-spending days.  The book is based around the idea that you can get out of debt on $10 a day. 

 

I’m a huge believer that debt and overspending can be traced back to psychological factors and/or personal insecurities.  So before we get to the part where we find that $10 per day, I must ask: How did you get into debt in the first place?

 

For many women, the reason is simple: we needed to fill the gap of what we make and what we need to live.  For many others, we had inadequate savings to bail us out of an emergency.  Lastly, many women have a spending problem.  Although society constantly makes jokes out of shopping too much, i.e. the new movie “Confessions of a Shopaholic,” it is a serious problem for many.  Retail Therapy is a topic that deserves its own post, but in the meantime consider if you may be guilty of this “disease.”  Regardless of your reason, identify it so you can stop history from repeating itself in your life!

 

Did you follow my advice and get out ALL of those icky credit card statements at the end of 2008?  What did you see?  If you haven’t done this yet, you need to.  You should know exactly how much debt you have, and how much debt you’d like to end 2009 with.  Yes, a number is required here.  You aren’t allowed to say “I want to have less debt and more savings” because that is not a clear goal that you can work towards. 

 

Back to finding an extra $10 a day.  The obvious answer is to cut lattes and going out to lunch but for many American’s, this isn’t the answer.  We like to get out of the office and we have a Starbucks addiction, fair enough.  $10 a day is about $300 per month.  I took inventory of my own spending habits and wanted to share ways that I found an extra $300 per month to put towards debt or savings:

 

  • Going out.  My biggest spending weakness.  I’m not at ALL saying don’t go out.  Live it up, have fun but just keep an eye on it and maybe limit the # of nights you go to the bars if it’s cutting into your pay check too much.
  • Books.  I can’t stop buying books on amazon.com!  I suppose this is a healthy way to spend money, but I’ll admit sometimes I buy more books before I’ve even started reading books from my last order.  Perhaps I should consider going to the library for FREE…
  • Gym Membership.  Jean Chatzky says that if you use your gym 0-1 times per week, then it may be time to cancel it because you are wasting money.  This is a matter of personal values and choice.  For me, I can’t imagine life without my gym, but if you aren’t using yours consider cutting it.
  • Travel.  Don’t go unless you can pay for your ticket in full.
  • Hair.  Platinum blonde is super expensive.
  • Manicures/Pedicures.  Do you really need them every week?

 

You get my drift.  In order to reach goals, you will need to identify your weaknesses and hang up’s.  I don’t want you to start living like a pauper who wears ugly clothes, has roots and never goes out-gross!  I don’t think that is realistic.  Find out what you value, and maybe have less of it.  If you really can’t part with being blonde, for example, find a way to spend less on being blonde, or better yet find a way to make more money (yes, part time jobs are GREAT!) so that trips to the salon are no longer a burden you need to charge on your credit card.

 

I’d love to hear more of your ideas on how you can save $10 a day (or $300 per month) because I know there must be a thousand ways to do it.  I could use the advice just as much as any other girl could.  Please share your thoughts!

 

Day Trading and The Quarterlife Crisis

By, Jack Cosier

I am a commodities trader. I never thought I would enter this world of ups and downs. Although you may be surprised, my profession parallels the emotions and feelings behind the quarter-life crisis. Even more importantly, trading has taught me how to manage and express these emotions to positively enhance my productivity.

2757635571_98ba2533ffFirst, the emotions behind trading are huge. Many traders claim trading is 90 percent psychological. It’s about being mentally prepared for losing, maintaining a positive temperament, and knowing that every execution will not strike gold. I have seen these ups and downs second-hand from my father, a trader for 30 years. Whenever he let the stress of a bad day get to him, it snowballed; he would get discouraged about one trading day which led to a bad week, month, and so on. When I got into trading I made sure I maintained a positive attitude and confidence in the system I was taught; if I stayed disciplined in these areas I would eventually be successful.

These emotions and feelings are similar to the definition of a quarter-life crisis:

An emotional crisis in one’s twenties with anxiety and self-doubt following academic life (dictionary.com).

To me, this “crisis” is 100 percent psychological, and correlates with the “law of attraction.” Embarking upon a new stage in one’s life brings with it a lot of uncertainties and self-imposed high expectations. However, these anxieties are easily tamed with positive thinking, which will help maintain control of the future.

Like trading, there are ups and downs when striving for a successful career or life. Most importantly, in order to truly take advantage of “good trades”, we need to brush off the bad ones. If we are unable to do that, any chance of moving forward in a positive direction is hindered . The more we dwell on something not going our way, the longer we prevent ourselves from making that negative happening/occurrence a distant memory. Instead, brush it off quickly, think positive thoughts and use them to fuel your next action, idea, etc.

Believe me, I know it’s not the easiest task to just immediately forget about something not going your way. Human nature seems to force us to keep dwelling on it. I know this through and through as a result of trading. Example: I have had many days where I just miss capitalizing on a particular trade. When I started trading, my reaction to these instances was not positive, as I would shake my head in frustration and get annoyed. Then I learned, “How can you get mad at the market?” Just keep doing what you’re doing and it’ll eventually work in your favor. I now try my best to shrug it off and keep a short memory about missed opportunities or small losses.

Yes, I’m still learning to organize these ups and downs as far as trading is concerned. But, I’ve realized it’s not a sprint, rather a marathon, just like our careers. Success doesn’t happen instantly. The lottery has one in 18,000,000 odds for a reason (savingadvice.com); instant wealth and success typically do not happen in one minute.

Stay patient. Keep grinding. Stay focused on the light at the end of the tunnel. Clichés such as looking at the glass as half-full are excellent tools to help keep yourself motivated. Believe me, they work. Keeping a positive attitude despite tough breaks is a tall task. But, if you find a way to manage the breaks and turn them into something productive, you’ve set yourself up for success in any facet of your life.

Good luck to everyone. I welcome comments on this post, and I urge you all to stay positive in your endeavors.

Jack

Jack is my wonderful and amazingly supportive boyfriend.  Watching him grow as a person and find his career niche over the past year has been an awesome experience!

Save a “Latte” Money!

I happened to catch a news segment about how Starbucks is being affected by the recession and it got me thinking. First, I love Starbucks and if I could have a dream office, I’d place a desk in the middle of my Starbucks and work happily. Second, I admire their business model and branding (my favorite book about this is The Starbucks Experience). Therefore, I found it surprising that even Starbucks’ sales were down.

2600559012_340c7fbb3e_mEver since we got a Starbucks next door to my office, I’ve gone through periods of going way too often. As someone who is conscious of making smart financial decisions, my Starbucks addiction doesn’t really match up. We’ve all heard Oprah, Jean Chatzky and Suze Orman tell us how much we could save if we cut lattes out of our daily routine. Apparently people are starting to listen.

Since I like numbers and facts, I wanted to do some math to find out how much Starbucks can really hit your wallet. Here is what I discovered:

· There is an 11.5% tax on food and beverages in Chicago…um, where have I been? I had never looked at my Starbucks receipt before today (oops). Why the need for an 11.5% tax, Chicago? Have we been financing Blagojevich’s corrupt schemes, or maybe paying for his newest wig (sorry, had to say it).

· If you buy a grande latte every work day, you will spend $74.80 per month. ($3.74 * 20 business days per month)

· You could do the following with $75: pay your monthly car insurance bill, buy new shoes, go out to dinner and drinks with your girlfriends twice, or save for a rainy day.

· Your daily “addiction” will cost you $897.60 over the course of 1 year.

Now what if you decided to give up your daily Starbucks visits and direct deposit that $75/month into a retirement account?

Despite the current economic condition, the average expected return for retirement accounts is still 10%. If you put that $75/month into your 401(k) plan, your contribution will grow to $5,931.18 after 5 years.

I assume you are not retiring in your thirties. Therefore, check out how much your $75 monthly contribution can grow over the years:

· After 10 years the value of your investment will be $15,566.40

· 20 years, $57,502.27

· 30 years, $171,024.40

· 40 years, $478,333.52

Wow, now I’m impressed. Who knew that your cup of joe was so expensive in the long run! I hope this inspires you to take a look at your 401(k) contributions today and make sure you are putting at least this much away for your future. For other scenarios, check out this easy to use calculator.

Even if you think that you can’t possibly afford to save right now, try to cut something small out of your day and remember that it will lead you to big things in the future. And in the meantime, you’ll be acting as a smart, savvy and sexy woman!

In Fear of Being Laid off?

“I’m sorry but we’re going to have to let you go.”

Unfortunately this is a sentence more and more people fear these days. Many employees at both senior and junior levels have had the misfortune of experiencing a layoff, including a few people I know.

For my friend Nichole, who was a Catering Sales Manager at a large hotel, losing her job was a COMPLETE shocker. She told me in an email, “My boss called me into the office and started talking about the downturn of the economy. Then I started to get woman’s intuition.”

I was surprised that her role, which produced a lot of income for the hotel, would be eliminated. I asked Nichole if the cuts at her company were being made at all experience levels. She said that she was at the manager level, but one of her admins was let go as well.

12131When Nichole told me she was laid off, I immediately assumed she would get a decent severance package that could hold her over for at least a month while she was searching for a new job. Yesterday she emailed me and said that the severance package (two weeks’ pay) that was “pending approval” for the past two months was denied. Ouch.
I can’t even imagine how it would feel to be laid off. Nichole said, “Right afterwards I was sad and mad. Then on the way home I realized that I wasn’t happy there and that it was a blessing in disguise.”
Here are a few pointers for those who need to survive a layoff:

Start networking today. Dust off your resume and your interview suit, use holiday parties to let others know your background and interest in pursuing new opportunities.

Decide now if you’d rather risk a layoff or leave on your own terms. If your future looks bleak, you hate rejection and don’t have money saved up, you may want to find a new job before it’s too late.

Consider a new career path. There’s no time like the present to satisfy your curiosity and switch industries or make a career move. If you were too afraid of losing the security you once had, now is the time to jump because your security is scarce anyways.

COBRA. Don’t worry, you still have the option to continue health insurance coverage after a lay off through this federal law. You have 60 days after termination to elect this option. My recommendation is to wait out the 60 days before electing since you would be responsible for paying the cost of the coverage that your company used to pay. Luckily you can still elect COBRA if you need medical coverage on day 59!
o If you have a pre-existing condition you may want to elect this option immediately to insure that your next provider won’t make you wait up to a year for a new policy. Also, if you plan on going “across the pond” you should probably elect this coverage too.

Don’t even think about tapping into your 401(k). The tax penalties and fees are too great. Although it may not seem like it now, your 401(k) will be much more useful to you later in life.

Keep your emotions in check. Most women take lay offs personally and feel rejected and hurt. Although you may be tempted to spend your time drowning your sorrows, don’t let yourself get to the point where you’re depressed or angry. Spend part of each day on your job search and take care of yourself so you can move on to bigger and better things.

Check out this slide show by the Chicago Tribune for signs of an upcoming layoff.

Confessions of a Former Sub-Prime Lender

So most of us are to the point where we can’t handle hearing one more negative news story on the recession, failing banks or the bail out.  Personally, I think we had it coming to us. 

 

I think back to my first job after college where I was selling sub-prime mortgages for one of the largest and most reputable financial institutions in the world.  My experience there is the perfect example of why I feel this way. 

 

For those of you who aren’t familiar, sub-prime lending is when financial institutions give loans to customers with less than ideal credit scores.  These customers are considered high risk and get loans at a higher rate than someone with good credit. 

 

At my job, we were trained to believe that we were doing something great for our customers!  That 12% interest rates plus 3 points (3 points = an upfront cost of 3% of the mortgage amount added to the loan balance) on mortgage refinances was totally normal.  I found this interesting considering the mortgage rate at that time was about 7% with no points. 

 

I was told that giving a hardworking customer a loan for more than their house was worth was GREAT because we were paying off their $70,000 in credit card debt and reducing their monthly payments.  One time, I did a mortgage refinance which used the equity in the customer’s home to pay off their brand new Cadillac Escalade, because the $800 monthly car payments were “really killing them”…(Um hello, do you REALLY need an Escalade?!?)

 

Of course we mainly closed Adjustable Rate Mortgages (aka ARM’s) that I knew the customers wouldn’t be able to afford once the rate adjusted upwards.  We took ALL the equity out of their homes which they had worked their whole lives to pay for which means they’d have no nest egg for the future. 

 

I could go on, but I think you understand why my time at this company lasted only a short time.  Although not all the mortgages I closed were as extreme as the examples above, I couldn’t sleep at night knowing what I was doing to make a living.  Even as a ripe newbie, something just didn’t feel right.

 

Turning on the news almost 3 years later shows that my gut feelings were right.  Americans and their big corporations had this coming.  Credit was way too easy to get, it seems like almost anyone could walk off the street and get a loan- even if they couldn’t pay for it.  The people giving out these loans had no stake in whether or not they were paid back because, in many cases, mortgages were bundled together and sold off like commodities to other huge financial monsters. 


How did I end up at a job like this?!  Well, I had no clue what I was getting into from the interviews.  NO clue.  But that’s another story.  I will say that I was also told that I would “definitely” make $70,000 my first year and that this was the hot new career path for sales-oriented finance majors. 

 

So maybe it’s not just the big companies who are responsible for the economic downturn:  people like me and my sub-prime customers are responsible for the economic downturn too. 

 

I went into this job solely for the opportunity to make a lot of money at age 22: greedy and unnecessary? Maybe.  Were my customers being responsible by allowing themselves to buy Escalades they couldn’t pay for and racking up sometimes over $100,000 in credit card debt and hoping someone could fix their mistakes?  Maybe.

 

No one forced me to take that job, nor my customers to make their excessive purchases.  For some reason we, as Americans, felt the need to prove something to keep up with the “Jones’“.  Yes, technically financial institutions let us take it too far but in the end, we were the ones making those decisions.

 

And now the bubble has burst and everyone wonders what happened.  The good news is that even the wealthy can feel the effects of being greedy this time.  The recession is affecting everyone and I think it has caused all social classes to take a step back and re-evaluate their basic needs and values.  I hope America learns a lesson from this rather than allowing the cycle to repeat in the future.

 

Favorable Job Market for Recent Grads?

Check out this post (written by Penelope Trunk, founder of Brazen Careerist) which explains why there are plenty of jobs out there for young people.   Trunk claims that the job shortage pertains to the older generation, not young talent.

This is the first time in a long time that I’ve heard something positive in the media about the Gen Y job market.  I have a handful of friends who have been laid off recently so I found this article surprising. 

As the baby boomers retire, there will be a large need for experienced talent in Corporate America.  Does this mean that comapnies will hire less experienced workers to do their jobs? 

Perhaps companies who are cutting costs will hire younger employees which, in effect, gives us twentysomethings the opportunity to get corporate experience we may not have had the chance to get in a thriving marketplace.