THE BRAZEN CAREERIST- Career focus: Cut out spending to focus on success
I have earned a lot of money in my life. But I have never had an extravagant life. I don't own a house. I've never bought a new car. I've never bought a new piece of living room furniture, and I do not own a single piece of real jewelry. What I have spent money on was always intended to help me with my career. That was so I know that I can always earn money doing something I love.
I leased a BMW when it was clear that cars mattered when it came to making deals in LA. I hired a stylist when I realized my clothes were holding me back in NYC. In Madison, Wisconsin, where I now live, I have tons of household help so my kids don't have a crazy schedule because of my work schedule.
I am convinced that frugality is a key quality for a successful career. Here is why:
1. Spending is generally a distraction
We know that people shop as therapy. People use it to fill holes they perceive in their lives. But the psychic energy it takes to spend money actually distracts us from what matters. PayPal reports that people wish their significant other would spend less money on Valentine's Day. This encapsulates the whole problem to me.
2. Spending money is a vehicle for overcommitment
The biggest example of this is graduate school. The people who do best in a bad economy are those who are flexible about the types of jobs they can take and the types of careers they can move into, according to Philip Oreopoulos, professor of economics at University of Toronto. This flexibility is specifically limited if you go to graduate school – you commit two, three, four years to a given career whether or not it's going to pan out for you in the long run. And you commit to paying back school loans, which means you need to take a job that earns enough to pay those loans.
3. Spending money limits possibilities
If you invest in an expensive bicycle because you're going to do triathlons, then you limit your ability to take off more time from work to actually train for the triathlon. In most cases, renting a house is better for you than buying one: If you buy a house, you cannot easily downsize, you cannot as easily relocate, and you end up limiting your earning power.
4. Entrepreneurship is a safety net if you're frugal
Careers today are unstable, and while companies formerly provided employee safety nets, today we create our own. The best way is entrepreneurship. But starting your own company is nearly impossible if you have high income requirements because startups don't provide high incomes at the beginning.
My larger-spending friends would say there's a compromise, that you don't need to give up all the creature comforts of life.
Maybe it's my obsessive nature. I'm willing to make extreme tradeoffs. I wrote earlier about wanting to be an expert and about how it takes a singular, daily focus. And I think I have had that with writing. But in order to do it, I have given up a lot. I'm not sure if that's right.
Do we hear about Mozart playing kickball? I know, there wasn't kickball. But if there had been, he wouldn't have played it. Because you give up stuff.
So I guess what I'm saying is that being an expert in something requires frugality. It's not just a spending frugality. It's a focus frugality.
Penelope Trunk has started several companies and worked for many more.