Build your career like an investment portfolio
Think of your career as you would your investment portfolio. Invested well, it will grow and deliver returns over a lifetime.
With that premise, let's see how tenets of good portfolio management can be applied to management of careers
Have a consistent investment philosophy – Pick your profession and grow with it.
Whether you pick a career specializing in an industry, function, or trade - build on it. In dedicating yourself to a professional track, you grow with it, benefit from new opportunities which open up in that profession, and reap the benefits of the expertise which accrues with time.
As an example, professionals who dedicated themselves to careers in IT services over the last 20 years benefited from the opportunities which opened up to work in different geographies, newer technologies, and more challenging business pursuits.
Ensure diversification (job type and location) – Pick a profession which has breadth and hence portability - within a company, industry, or geography.
This allows you to find new jobs in other companies, industries or geographies in the event your job is at risk. Beware of niche roles with limited portability (excessive portfolio concentration). These can tend to be high risk. Similarly pick a job location which offers multiple roles in your chosen profession and mitigates costly and disruptive location moves.
Invest continuously. Believe in the power of compounding – Invest in building your career continuously.
A steady and methodical accumulation of investments over time helps grow the corpus and also the returns from dividend and interest.
Invest in continuously building professional skills and networks. Take on new challenges and raise your hand when opportunities are offered. Stay involved, engaged, and active in your profession at all times. With time, you will build deeper knowledge of how the industry works and also a network of connections which will be resources for advice, collaboration, and professional success.
The ongoing investment and tenure also helps build specialization – in technology, process, or function. It is this specialization which is most valued in the later years of a career. Think of all the less-specialized jobs which are being automated while the demand for architects, domain experts, deal makers, and forensic accountants continues to be high.
Stay invested – cash earns very little – Keep investing in building capabilities at all times.
At work, go all in, keep building expertise and networks. They pay off. Don't hang back, waiting for that one great opportunity or role to come your way. You don't earn or learn while sitting out.
Pick jobs where you will learn and be challenged. These will be accretive to your career and akin to accumulating investments.
When you pick jobs which do not offer learning or challenge, you are spending the dividend/interest from past investments in the professional skills and expertise. With time, the invested pool will dwindle, and be insufficient to give the returns you need.
Avoid too many shifts / trading – chasing the latest hot stock – Focus on your chosen profession and industry.
Build equity and specialization in your profession. These are critical to success in a career.
In making many job changes across roles or industries (chasing the "hot" job of the year) you will lose the opportunity to build a specialization and will also miss out on opportunities which might have been yours if you had continued to invest in your original job/company. Think of how many times you have heard "I would have got that job…If I had stayed on"
Buy what you understand – Focus your professional investments into areas around your core profession.
You understand the relevance of emerging trends within your trade and profession and are more likely to make good judgements on where to invest your time, effort, and money. Moreover, the likelihood of your getting recognition and value for new skills gained within your career specialization is higher than for those in unrelated areas.
Have an age appropriate portfolio. Aggressive in the earlier years and more conservative in the later ones.
Take your chances with start up's and emerging industries in the early years of your career. As you age, gravitate towards industries which are more stable, aligned with demographic trends, and hence offer extended careers. However, at any age, take roles which offer a challenge and the opportunity to learn new skills relevant to success in your profession so that you continue to invest in building competency and relevance to your career.
Keep costs low – Buid a rainy day fund.
Even though you may be doing extremely well in your career, jobs can be unpredictable. Think of all the guys at Lehman, WaMu, and all the financial institutions in the last decade. Keep your costs manageable, building a rainy day fund which you can dip into when you are between jobs to ensure that your (and your family's) lifestyle priorities are funded.
In closing
Principles which help build a sound financial portfolio can also be applied to the building of a career.
Keep swinging!
