How Much Should You Invest In Yourself?
De Beer's Diamonds says you should invest two months' salary in an engagement ring. The conventional wisdom is that you should save at least 10% of your income and invest 60% in stocks and 40% in bonds. Realtors will advise you to invest 4x your annual salary in a home. These are helpful guides for making decisions even if they are dreamed up by people trying to sell you things.
Why doesn't anybody tell us how much we should invest in ourselves?
Of course, you should finish high school, and these days it's a given that you should go to college and graduate with a degree. There are certifications and tests to pass if you want to be a CPA. These paths prepare you for a specific field of expertise, but they fail to tell you the adequate amount of time and money you should invest in yourself if you want to live a fulfilling life.
The answer is more than whatever is paid for by your company. Like the examples above, we are making up a number here.
What if you invested 10% of your time and income?
(Bold, right? Stay with me for a bit longer.)
Let's imagine two people to illustrate the point.
Person One - The Hard Worker
The first person goes to work daily with a great attitude and a strong work ethic. They are up for any challenge the company puts in front of them. Through experience, they are growing their abilities, skills, and competencies. This person takes advantage of the company-provided training and development opportunities offered.
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Person Two - The Investor
The second person has the same job, a great attitude, and an equally strong work ethic. This person also sets aside 10% of their vacation time and personal money to invest in themselves. This investment might be as sizable as graduate school or certifications in their field or as small as books, webinars, retreats, or online classes.
The New 10% Rule For Investing In Yourself
Following the 10% rule, the second person is investing 200 hours per year, or roughly 4 hours a week, getting better. If they make $100K, they have a $10K budget to accelerate their development. Imagine your life twenty years from now if you invest this much every year.
I propose 10% because it's large enough to be a line item on your budget. It's big enough to sting a little bit when you deduct it from your paycheck. It forces you to make choices and be more intentional, prioritizing yourself and your growth. After all, you are the golden goose of your life.
As the Chinese proverb goes, the best time to plant a tree was twenty years ago. The next best time is now.
Asking you to carve 10% out of your income is a big request for most. But if 10% isn't the correct number for you, what is? Defining the right number for you is an important choice and one you don't want to make too late in life. You're going to spend the rest of your life in the future. Shouldn't you start investing in it now?
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About the Author
Jeff Shannon is the author of the book Hard Work Is Not Enough and a partner at Bravium, a boutique facilitation and executive coaching firm helping leaders be more strategic, innovative, and effective. He leads over 50 strategy, culture, and leadership-building workshops per year, which means he observes business professionals in the wild and develops strategies to help them operate at their fullest potential.
