1/17/18

The Ultimate Success Guide For Graduates Who Want To Kill It: Part I

You were right. In case you haven't figured this out by now, I'm giving you permission to pat yourself on the back. All those times you sat in class thinking to yourself why the hell am I learning calculus when I'll never use this again or I can't wait until the day someone hands me a million bucks just because I can name the periodic table by heart were not completely misguided. I can truthfully tell you that I somehow find a way to succeed in my job by negotiating contracts and service rates without the use of those tools.

Our education system, while doing a fairly decent job of teaching us how to think and problem solve, doesn't do enough to address the real world situations we'll find ourselves in after school. Even those of us who get a degree use a small fraction of our education in our day to day lives.

I'm not here to bash the education system. Educating people from all walks of life collectively on the real world issues they might face would be an impossible task. What I am here to do is to do my best to fill the void as best I know how in four main areas of life: Money, Career, Wellness, and Development.

We'll talk about money & career today and finish up next Wednesday with some discussion on wellness & development. The point of this is not to fill every gap we see (that's kind of our whole purpose for the blog which we hope to continue for quite some time) but to provide quick, easy things you should keep in mind and focus on from day 1.

Christian, Ty, and I aren't some crazy Forbes 30 Under 30 types who are just killing the game and leaving you all in the dust. But we are living our lives with success in these four areas as a prominent goal we work toward every day.

The post grad life is pretty damn sweet in part because you still get to do all the things you loved to do in school but now you (hopefully) have a little money to crank things up a notch. Just make sure you're substituting your Ramen with burgers and not steak too often and you're not substituting your Natty Light with $200 bottles of wine every week.

1. Money

Obviously if I thought I could fit all my money tips into a couple paragraphs, I wouldn't have this blog. Yes, personal finance can be a complex topic full of stressful decisions. But if you really don't know much about money and don't ever care to know much, I have two tips that will go a long way in helping you achieve long-term financial success.

     1. Save at least $1 per work hour to become a millionaire.

A normal 40 hour work week translates to 2,080 hours worked per year. If you're able to squeeze out $1 of your hourly wage and invest that toward retirement, that translates to $173.34 per month (I'm banking on you finding an extra penny every month for the roundup -- keep your head down when you walk). 

Even if you don't get an employer match on a 401(k) or any additional retirement benefits at all, you can retire a millionaire. If you're investing this money in a Roth IRA or Roth 401(k), 100% of the money will be yours. The best part? You didn't even contribute $100k of your own money to get there. 

Year Annual Return Hourly Payment Retirement Amount Total Contributions Total Returns
2018 10% $1 $2,178.12 $2,080 $98.12
2019 10% $1 $4,584.31 $4,160 $424.31
2020 10% $1 $7,242.46 $6,240 $1,002.46
2021 10% $1 $10,178.96 $8,320 $1,858.96
2022 10% $1 $13,422.94 $10,400 $3,022.94
2023 10% $1 $17,006.62 $12,480 $4,526.62
2053 10% $1 $729,199.99 $74,880 $654,319.99
2054 10% $1 $807,734.88 $76,960 $730,774.88
2055 10% $1 $894,493.39 $79,040 $815,453.39
2056 10% $1 $990,336.65 $81,120 $909,216.65
2057 10% $1 $1,096,215.95 $83,200 $1,013,015.95

If that's not enough to prove my point, maybe my graph will be more of a jaw dropper.


The moral of the story is that compound interest is your friend. I'm not saying $1M is your magic number -- it might be more, it might be less. What I am saying is you need to be saving for retirement, and $1 an hour isn't a bad goal to start with considering it'll net you a cool million.

     2. Keep your fixed costs as low as possible for as long as possible.

Lifestyle creep can be a major issue in our working lives, but where we put our stake in the ground is even more indicative of our future financial success. Going from making low wages during college and spending it all at the bars to making money at your first real job can cause temptation to drastically upgrade your lifestyle.

Maybe you want to rent a place at that fancy brand new apartment complex downtown and buy a brand new BMW so you can keep up with the Joneses in the garage. If you've got a great job, you've done the math, you know you can afford those things, and you don't have other financial goals you really care about achieving anytime soon, then by all means, live it up!

For the majority of us, that's not exactly the case. If you care about achieving your financial goals, then you need to keep your fixed costs down. Fixed costs include all the payments you make to live on a monthly basis including any loans you might have (student loans, car loan, credit card debt), your rent (or mortgage), utilities, cable, internet, and even your minor monthly expenses you've made a commitment to such as a gym membership.

When I graduated college, I moved back in with my parents. This worked out for me because I have a wonderful relationship with my parents, but it's not exactly every college grad's dream. I could've easily gotten a nice apartment in Findlay or even bought a house after a short while, but I chose to stay at home, thus lowering my fixed costs.

I saved that money I would've been paying toward rent and paid off all my debt which consisted of my car and student loans. This meant the only real fixed costs I had to worry about were my car insurance, my gym membership, and my phone. Just about $200 a month to live wasn't so bad!

Even now after I've moved to Findlay, I split a 2 bedroom apartment with my friend Jordan and pay a monthly grand total of $400-$450 depending on our electric bill. I purchased my gym membership up front, so I don't even consider that a fixed monthly cost anymore. This lifestyle design has allowed me to run substantial cash surpluses month after month allowing me to pay off $30k in loans and setting myself up for flexibility and the ability to achieve the next goals on my list in the very near future.

My lifestyle design consisting of low fixed costs has allowed me to live with a great deal of freedom to do pretty much exactly what I want to do. That's worth way more than any car, house, or other material object could ever offer.

2. Career

This is quite possibly the toughest transition you're going to make during this time in your life. You may expect to be prepared after 16 years of school give or take, but you're most likely going to get blindsided.

Several factors contribute to this lack of preparation. One factor is that you're used to a pre-determined schedule and an opportunity to study (cram) before a big exam. At work it's more like you have multiple quizzes every day many of which come with no warning. Although most of the quizzes are open note, this may cause you to start worrying about what's coming next.

In your career and most anything that you really care about succeeding in, you're most likely going to struggle with bouts of self-doubt. You may wonder whether you deserve to be there and whether you have what it takes to succeed.

Let me be very clear with you that you absolutely deserve to be there and you have everything it takes to succeed. Companies are very savvy with their recruiting practices and don't like to take huge risks. You wouldn't be there if you weren't more than qualified to be doing an exceptional job in what you're doing. Now it's up to you to put in the hard work and conduct yourself in a manner necessary for your own personal success and the success of your organization.

     1. Bide your time.

Regardless of how well you think you may be prepared for this job, you have a lot to learn. Don't walk around like you're hot shit and know everything there is to know. At least for your first couple months or so, you need to shut your mouth and take it all in. 

Your ability to make an impact is largely predicated on your ability to build trust with your coworkers, your bosses, and your customers (the people benefiting from your work outputs). You need to spend your first several months really focusing on shutting your mouth, putting your head down, and working hard so you can build that trust.

Nobody is outstanding at their job the first day they show up. Organizations understand that there's a learning curve every new employee experiences, and it's on you to understand that as well. I had an Organizational Behavior class in college where my professor taught me one of the most important life lessons I even learned in all my years of education.

Basically nobody is a truly high performer at their job right away. Companies hire college grads because they like their potential, and also because they have a high likability factor. If your boss likes you, it's difficult to make a decision to fire you, even if you never actually become a truly high performer. Since you're not outstanding at your job right away, you need to be focused on building your trust and likability factor within your organization.


     2. Ask Questions

Once you've put in a good amount of time taking everything in through training and daily observations, it's time to ask questions. If you don't ask questions early, then you'll most likely going to feel too embarrassed to ask what seems like basic questions later on. Generally speaking, people want to help you succeed, so they're happy to answer questions for a new employee. Asking questions shows you're eager to learn and you care about developing yourself into a high performer.

The important thing to keep in mind is to actually find an effective way to remember the answers. Asking a question once is perfectly acceptable. Twice is okay but a little annoying. Three or more times is definitely in the annoying territory, and you do not want that label. 

Also, make sure you take a second to utilize your resources and tools available to you before asking a question. You don't want to get into a habit of asking questions just because you're being helpless and using your coworkers or boss as crutches. Again, that becomes annoying real quick.

     3. Find Ways To Do More Than Your Job Description Requires.

Chances are you don't want to stay in your entry level job with your entry level salary very long. But checking boxes in an entry level job is not going to get you the promotions and raises you desire. You need to create more boxes and provide an extraordinary level of value to your organization. An entry level job is essentially an audition that will go a long way in determining just how high you might be able to climb in your organization and how quickly you'll do so.

Once you've spent your first few months biding your time, learning, and asking questions, not it's time to get strategic and offer a fresh perspective. The only way to establish a true competitive advantage is to do different things than your competitors or to do the same things differently. You can't just rely on doing the same things better than everyone else for 40 years. You need to apply this philosophy to the way you conduct yourself in your own position and to the proposals you make for changes within your organization.

Once I had finished my formal training and spent a few months applying what I had learned to my job, I noticed my training hadn't really done a great job of setting me up for success in my position. I had put in a good deal of effort building trust with my coworkers and bosses, so I decided to cash in by creating a whole presentation of how the training was inadequate and how it needed to be improved. This could've easily come across as cocky or brash, but I was very careful about the timing and manner with which I presented this to management.

I thought my presentation had been forgotten about, but then almost a year later I was asked to participate on a team that would be evaluating our training needs and would be responsible for proposing a change. I spent several months on that team with other new hires in the past couple of years, and we made a proposal that was ultimately accepted by management and is currently being implemented. I can't take 100% of the credit for the change, but I do believe I sparked some thought and kicked the change into hyper-drive.

Next Up. . .

Next week we'll dive into how we should be focusing on ourselves through focused efforts toward our Wellness & Development. In the meantime, we want to hear from you!

What are you doing with your Money & your Career that has worked for you? What questions do you have or future strategies are you taking that the rest of the Smart Money Squad might benefit from? Let us know in the comments!

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