Do You Know How To Work?

Ben Stein has written a very thought-provoking article that for Yahoo! Finance called “All Play and No Work Makes for a Poor Life.”

I realized while reading it that Ben might as well be talking to me. And I think his points are pertinant to the goals and attitudes of millions in my generation.

New Cultural Phenomenon: Aversion to Work

Ben’s basic message is that “while almost everyone I know went to college, very few learned how to actually work — i.e., how to give an honest day’s labor for a paycheck.” He mentions various friends of his who have never held a steady job, “creative” types who live one paycheck away from homelessness because they can’t IMAGINE working a 9 – 5 job, women who spend their attractive youths “working” for various rich boyfriends, and other examples.

I have observed this reality quite a bit, now that I think about it. Many people quit working (or never start) at the first opportunity. Females upon marraige or pregnancy; males upon inheriting or accumulating a modest sum. More than a few of my peers chose one of the following alternatives to work shortly after graduation or after only a year or two in the work force:

  • “I got married and/or got pregnant!”
  • “I’ve decided to start my own businesses!”
  • “I volunteer” or “I work for X foundation/museum/non-profit”
  • “I am traveling abroad to experience the world and find myself”
  • “I’m going to work for my family’s company”

Oh, and lets not forget the ubiquitous

  • “I’m going back to school.”

All of these are theoretically wonderful choices, but they are all to often code for “I don’t know how to and/or I refuse to actually work.”

The Benefit of a Hard Day’s Work:

The problem with this is that people who never experience working hard to earn a paycheck also never develop the pride, empowerment, and work ethic that comes along with it. “Work elevates the spirit, disciplines the mind, conveys self worth — redeems life itself.” Ben points out that people who develop the habit of hard work don’t become bums, criminals, or drug addicts, and they don’t wind up in middle age with suicidal self-loathing.

Even those who “work” can fall prey to work-aversion techniques and end up tempted towards addictions and the self-loathing Ben warns against. There’s a difference between earning good money and hard work. Lots of people earn great livings, and many would insist that they “work hard”–movie stars come to mind. But literally working hard for hours on end in order to earn your dinner money–without the option to leave for an appointment, surf the internet, or make a phone call–is a very different thing than what many of us experience at work.

Studies show that most Americans only contribue 2 solid hours of productivity to their employers during a typical 8-9 hour workday. Email, internet, computer games, phone calls, chatting, work-gossip, and meals are what we really spend our time, attention, and energy on.

The Ruining of Our Generation?

Like many of you, I have a steady job, I get up every morning and work 9 hours a day, I am moving up in my company and developing a career. But…I’m not actually working very hard. The truth is I’ve never had to work that hard to earn my grades, resume, and promotions at work. And the truth is, if I didn’t happen to have a well-paying job that I like, I’d probably quit and choose one of the other alternatives to work I mentioned above.

I, like most in my generation, grew up being told “You’re Special!” and “You Can Do Anything You Dream!” Every student got a gold star and every athlete got a trophy. My generation spent its childhood learning how to be totally self-indulgent–travel, music lessons, sports, camps, shopping, TV, study abroad, eating out, allowances, etc. Those things all have their place, but perhaps good old-fashioned hard work should be added to the list as well.

More from Meg at The World of Wealth

Young People All But Ignore Planning for Retirement

Though the vast majority of eligible baby boomers participate in their 401(k)s, less than a third of workers 25 and under are contributing to these employer sponsored retirement plans. Even worse, only 4% of young workers are maxing out their workplace retirement plans, according to a recent survey by the tax information service CCH.

Ironically, these accounts are more important to young workers than to older Americans. That’s because the majority of younger workers aren’t covered by an old-fashioned guaranteed pension. Moreover, every dollar that 20-somethings save will be more valuable over the course of their lives than the same dollar will be for older workers. That’s because young workers have more time to invest their savings and then let that money grow, tax-deferred.

That quote came from an article found on MSN Money titled Young adults all but ignore 401(k)s, IRAs.

This table from Hewitt and Associates is both telling and disappointing on ALL levels:

401(k) Participation  by Age

Holy cow! Even those who are older than 42 only have an average balance of $93,000, while the median balance is just $44,000. By that age, the average balance should be $250,000 or more.

The question that comes to mind with all of this is:

What are we going to do about this?

I have a few ideas:

1. Start teaching and preaching about and personal finance early in life. Personal finance know-how is very important because it won’t do any good for young people to understand the need for retirement planning if they are drowning in credit card debt.

2. Make sure people understand the numbers when it comes to retirement planning. Stuff like how much it is going to cost, and how much is going to need to be saved in order to realistically reach that goal.

3. Automatic enrollment into target funds. I know this sounds anti-free choice, but I almost think we should make retirement savings MANDATORY kind of like social security is. I also think that if we went this route, we could possibly reduce the amount that goes into social security.

Those are a few that I can think of off the top of my head. I realize that number 3 is controversial.

What do you guys think?

Financial Planning for Generation X

If you are a member of Generation X, you’re parents are most likely Baby Boomers. Although most Baby Boomers are not financially prepared for retirement a lot of them do at least have some sort of inheritance to look forward to. Chances are, if the Boomers do inherit assets from their parents, they will spend them all supporting (and indulging) themselves in retirement, which will leave very little for Generation X to inherit. Therefore, if there was ever a generation that needs to get active in planning for the financial future, it is Generation X. Fortunately, most of us have time on our side.
Continue reading Financial Planning for Generation X