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Planning for Balance

I recently read about a Harvard study that attempted to find out how high level executives found a way to balance the high demands of their working and family lives. Some think that planning for work-life balance has nothing to do with their finances, yet in fact it has everything to do with it. Divorce is often a side effect of not planning this facet of life and in most instances this can have a more dramatic effect on your financial situation than even the dumbest investment mistake.

Another common misconception is that maximisation of your salary is priority number one, yet if what you have to do to get that raise or promotion ruins your relationships with your loved ones then the “incremental” advances in your financial stability may actually lead to a decrease in your overall happiness.

The main problem stems from a lack of defining your core life values early on in your career and deciding in advance, preferably with your partner, what kinds of trade-offs you are willing to take for financial advancement. Too many people just take life as it comes at them, and as they adjust to an ever increasing lifestyle, they get trapped into a situation I call “golden handcuffs”. They are too afraid to slow down in the rate race and eventually the situation blows up in their face.

Many times it is the hardship posting, which on the one hand can advance your career rapidly, that leads to divorces. Planning ahead and being prepared to say no if you feel like your partner is not on board may be what you need to do. Another option is to lay clear guidelines of how long you will sacrifice the “life” side of the equation, for instance 5-10 years abroad or on the “fast track” before settling into a normal 9-5 routine in a place you would like to be long term, even if it means taking a substantial pay cut.

There is no right answer that fits everyone, but many people fail in their personal lives simply because they fail to plan ahead of time and get pressured into making one trade-off after another. For me even the thought of a 9-5 work week stuck physically in an office makes me cringe. I am lucky that I can work mostly from home, the trade-off is that I need to travel more. I actually decided my major in university based partially on which degree was most likely to give me an option to work from home at some point. To others the thought of not being in an office may be unthinkable, so what works for me would not for them.

In the end it is your life and if you do not take the time to actively plan what you want out of it other than purely monetarily speaking you are going to end up with whatever randomly happens. In our modern world this usually means long hours and strained relationships. In business school it was the death knell in a finance interview if you admitted that you placed your family over your career, and if you did get into banking you would be surrounded by an office full that had likewise made the same commitment to career first.

A good approach to finding a job with a similar outlook on balancing the work-life trade-off is to “interview” the interviewer about this subject until you find a company that fits with what you want out of life. This approach may take longer, but it will pay big dividends to you over the course of your life.

David Mayes MBA provides wealth management services to expatriates throughout Southeast Asia, focusing on UK Pension Transfers. He can be reached at david.m@faramond.com. Faramond UK is regulated by the FCA and provides advice on pensions and taxation.

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