Episode Details

Having a job and a regular wage is comforting and secure, except if you lose that job. UK stats say that 45% of workers will be made redundant at least once in their working life. I'd expect the Australian numbers would be much the same. In that sense, being a full time employee is very binary. Very secure and reliable whilst you're employed, but when you're not, there's nothing. If Financial Autonomy is about having choices in life, then how does that align with being fully reliant on an employer to provide you with the income that you need to keep all the balls in the air? Most of us do work for an employer, and that suits us very well, so how can we align the desire for financial independence, with the financial dependence associated with being a full time employee? I've called today's episode The Security Illusion, because I think for many people, they overestimate the level of financial security provided by their employer. So what steps can you take to truly be financially secure? Well, that's what we'll be looking at today. Financial security. Who wouldn't want that? I often talk about financial independence, using it fairly interchangeably with financial autonomy as I think the difference between the two is fairly minimal. Could financial security be another interchangeable term? To me, the difference is in the mindset. Someone whose goal is financial security is thinking about controlling the down side risk. The risk that things will go bad. And that's no bad thing. The old "hope for the best, but plan for the worst" is certainly something we try to incorporate into our client's financial plans. But can you really control poor management decisions made by your employer, or industry changes that render your area of expertise redundant? When I think about the goal of Financial Autonomy, I think of it as something more proactive. Unlike financial security, where the goal is to find somewhere safe, Financial Autonomy is about consciously building a situation where you have control, and where you're not reliant on others. Financial security, in the form of full time employment alone, is I think an illusion. But that doesn't mean that you can't be a full time employee and achieve Financial Autonomy. Indeed that's how most people would achieve their Financial Autonomy goal. So how can you transition from valuing your job for the illusion of financial security that it brings, to valuing it for the potential it provides you to achieve Financial Autonomy, a far more useful aspiration. Here's a few ideas I've come up with. I'd welcome your feedback as to other options you can think of.

To me the most obvious way to reduce the risk of being out of work for a sustained period is to have more strings to your bow. If your desirability to an employer is built around your skill with a particular software package for instance, then what happens when the industry moves on and a new software solution becomes the norm? This is an exercise in seeing the forest for the trees. You need to take a step back for your day to day activities and think about where your industry or profession is heading. Are you building the skills now that will be relevant in 5 or 10 years? Very often employers have budgets for staff development and training, so if you see an area where you think you should develop your skills, hit up the boss to support you. The other good thing about undertaking some learning is that it highlights to your management that you are someone with aspirations. You don't plan on sitting in the current role forever. You want new challenges, and if they don't find them for you, they run the risk of losing you to a competitor. It may be that you take that helicopter view of your industry or career path and f