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Help a Reader: Career Move

Here's an enmail I recently received from a reader:

I'm 28 making ~$115,000 total compensation ($85k in salary). Working at a tech company and missed the last cycle of promotions (1.5 years into the role) the next role would be to manager. I would try to negotiate ~50% total comp increase.

I got a high score and at continued pace would be promoted in the fall (never guaranteed but will perform). What is your recommendation on staying versus leaving? I am still learning, but at a slower pace than I would like and management is giving me more responsibility. I like the team. I know I could, with some time and work, get a job at ~$150-200k total comp. at various other companies.

Most career situations are circumstantially based but wanted a discussion on:

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How Big is $1 Million?

Ha! Here's an article from Dr. Thomas Stanley that hits on a few messages I have regularly addressed:

  • $1 million is "not much these days." My contention is that it doesn't make you fabulously wealthy, but it makes you wealthier than most people.
  • Financial journalists may know how to write about money, but they don't know how to manage it.
  • Many "experts" advising you about managing your money aren't wealthy themselves and/or can't seem to take their own advice.
  • Where you live has a BIG impact on how wealthy you'll become.

Here are some highlights from the piece along with my comments:

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The Most Effective Way to Build Wealth

Money magazine asked its readers over 50 what is the most effective way to build wealth. The results:

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Personal Finance is Now a Required High School Class

Not that this is new news for everyone as I'm sure many high schools have offered personal finance classes for some time, but here's a story originating from a town near where I used to live. It's about the Rockford, Michigan high school now requiring a personal finance class for all seniors. The details:

The Dave Ramsey curriculum is used as the foundation for the course. Ramsey is a personal money-management expert. Units of study in the course include: Saving and investing, credit and debt, financial responsibility and money management, and insurance/risk management and income/careers.

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Investing Advice from Buffett

Fortune recently ran some investing advice from Warren Buffett. The whole article was quite interesting, but I want to highlight and comment on a couple points he made. Here's the first:

You don't need to be an expert in order to achieve satisfactory investment returns. But if you aren't, you must recognize your limitations and follow a course certain to work reasonably well. Keep things simple and don't swing for the fences. When promised quick profits, respond with a quick "no."

A few thoughts here:

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What's Your Target Retirement Age?

Money magazine recently asked its readers what their retirement ages were. The responses:

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Reviewing Rules for Real Estate Investing

I recently stumbled onto the BiggerPockets Ultimate Beginner's Guide to Real Estate Investing, a free PDF on how to get started investing in real estate. It was a decent read, even for someone like me who's been in real estate a bit, but it mostly reinforced what I already knew -- I didn't learn a bunch. It also spent a lot of time on areas of real estate investing I'm not interested in, so I skipped those sections. That said, I thought I'd share it with you because the price was certainly right. It was FREE! :)

The book listed three "rules" of investing in real estate that I thought I'd share with you. Then in a later post, I'll share my "rules" (or at least how I evaluate a property). BTW, I don't use any of their rules. Not to say theirs are wrong and mine are right, just letting you know this upfront. I'll let you decide what you like and don't.

Here's their first rule:

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Thinking About Vacation

For the past two years, we've taken our "big" vacation each January. We're trying to take fun and exciting trips with our kids while they are still home, before college kicks in and they scatter to one place or another.

For reference, we took a 10-day Caribbean cruise in 2012 and a 12-day one in 2013 (which was preceded by two days in New York City). In January 2014 we did not take a big trip for several reasons:

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Do I Need Life Insurance Once My Kids are Grown?

The book The Charles Schwab Guide to Finances After Fifty: Answers to Your Most Important Money Questions addresses the issue of whether or not a person needs life insurance once their kids are grown. It lists five questions people need to consider when making this decision as follows:

  • Do you have a financial obligation? (such as a very large debt)
  • Do you have a spouse or other dependent with on-going needs?
  • Are estate taxes a concern?
  • Do you want to leave a large portion of your estate to charity?
  • Do you own a business?

If you answer any of these "yes", you may need life insurance well beyond the time when your kids are grown.

Here's my position on each of the above:

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