Tag Archives: success

Should You Spend Less on College?

money stackBy Joanie Connell

Parents and students beware! Don’t get suckered into taking out unaffordable college loans because you think you have to. You don’t.

The problem with financial models is they assume people make rational decisions. There’s nothing rational about overspending. People overspend for emotional and psychological reasons, not rational ones.

We overspend because…anxiety

  • We feel anxious: we need to keep up with the Joneses, we feel insecure about our abilities, looks, or status. (Salespeople prey on people’s anxieties to sell them things. See techniques used and a sales example.)
  • We want something really badly: we see a beautiful house and we have an overwhelming desire to own it. (Salespeople also create customer desire to sell. See techniques used and a sales example.)
  • We think we deserve it: we feel entitled to go to a good college because we are a member of a certain group or because we have worked hard to get good grades.
  • We invoke psychological defense mechanisms to believe we can afford what we are buying: we deny that interest rates will go up, we rationalize the luxury car is necessary to impress clients.

There are many more irrational reasons for overspending, but the point is we need to stop doing it.

OVERSPENDING ON COLLEGEgraduates

“Too many degrees are a waste of money. The return on higher education would be much better if college were cheaper.”

One of the biggest problems in our nation right now is that young people are overstretched with costly student loans and it’s limiting their ability to live independently. Financial analysts have shown that, for many people, the investment in college has a negative return. (See The Economist and The Wall Street Journal for recent articles). Why are people spending so much on college then?

“Four in 10 college graduates, according to a recent Gallup study, wind up in jobs that don’t require a college degree.”

Frankly, I think the biggest reason why young graduates are in great debt is because they thought they had to go to the college they chose to get a good job. This is driven by anxiety—the fear of not being attractive in a highly competitive job market. Evidence shows that expensive college degrees are not necessary for most jobs. Check out the College Planner for more on this and for advice.

“A study by the Harvard Business Review found that almost half of the top executives at Fortune 100 companies did not go to prestigious schools.”

Prestige is another driver for choosing a college. I think that parents are the main contributors to the prestige factor because it makes them feel more successful as parents to have their children go to more prestigious colleges. The Boston Globe reports on how parents are using Face Book as a bragging platform to boast about their children’s college acceptances.  Here is a great blog from the Huffington Post for all you parents out there who are doing this.

The Huffington Post provides a “ranking of the public colleges with the highest return on investment.”

Entitlement is another major factor. A high school student told me she wouldn’t consider going to the local state college, as she literally turned up her nose. I was confused because it was a good school at an even better price and her family had only modest means. She chose to go to a state college in a neighboring state and pay out-of-state fees instead. She also moved back home after graduating, burdened with large student loans.

These are all psychological reasons for choosing colleges that may turn an otherwise practical decision to an impractical one.

OVERSPENDING ON LIFESTYLEmoney roll

Student loans aren’t the only factor contributing to young people’s financial problems. The new grads feel entitled to a high standard of living right out of college. I have been surprised at how many 20-somethings I know who have lived in their own apartments, walking distance from the beach here in costly San Diego. Some of them have moved back home because they say the cost of living is too high for them to afford. Well, of course it is if you expect to have an apartment next to the beach! Seriously, who can afford that?

What are reasonable expectations for a standard of living for a recent college graduate? A used car, an apartment with roommates and mismatched, self-assembled furniture in a rundown part of town would seem like a start. It takes time to earn money and save up to buy furnishings, piece by piece, and eventually make enough money to rent a nicer apartment or get a nicer car (emphasis on “or”). It’s not reasonable to expect to have all this right out of college, especially if you have loans to pay. It’s also part of the experience and the fun of being young.

All of the issues here are affected by the economy and demographics as well as psychological factors. Yes, it is more competitive to get into college these days and there is higher unemployment than at some times in our history. The standard of living has also increased so we should expect to have a higher standard of living than at previous times in history. Yet, young people are still financially overstretched and they don’t have to be. We don’t have control over all of these factors.  Yet we can take control of the psychological factors if we are aware and deliberately make practical choices.

Be wise. Make a practical decision on where to go to college. You will be thankful later.

Stop and Think

by Joanie Connell

stop and thinkThe downside of operating at lightning speed is that we don’t have time to reflect on what we’re doing. We respond to challenges with knee-jerk reactions and leap onto the bandwagon without ever stopping to question whether this is the right way to go. We think it is right because everybody else is doing it and we don’t want to get left behind.

In today’s world, we are all under an enormous amount of pressure to do things quickly. We need to keep up with minute-by-minute stock prices, what is “trending now” on social media, whose kid is participating in the most extra-curriculars, which traffic lane is going the fastest, and what emails are already stacked up in our inboxes. It’s exhausting! Yet, we don’t stop. We keep running faster and faster, managing more and more information.overwhelmed

Ironically, the need for speed is slowing us down. Really. It. Is.

How could that possibly be? It is because we aren’t taking time to stop and think. When we run at full speed, we make careless mistakes. When we do too many things at once, we make haphazard decisions. When we feel pressure to keep up, we mindlessly follow the pack. If we don’t take time to stop and think, we may end up losing the race—remember the tortoise and the hare—and trampling others along the way.

CARELESS MISTAKES

Typos, bugs, and safety recalls are often caused by careless mistakes. We are racing to meet deadlines, under pressure to get torace car print or to market quickly, and we work fast without checking it over. Careless mistakes cost us time and money. For example, the most common reason for the IRS to reject an income tax return is because of a careless mistake, like the person forgot to sign the form. A rejection is usually accompanied by a fine. Thus, slowing down to proofread your tax form could speed things up and save you money.

As much as we like to think that we are good at multitasking, the evidence is to the contrary, especially when it comes to complex tasks. Of course, doing a load of laundry while you are washing the dishes is fairly benign (unless you forget about the laundry). Texting while driving is not. At work, we read email during meetings and wonder why our meetings are so ineffective. At home, we do our homework while instant messaging. It’s hard to concentrate on more than one thing at a time. You can shift back and forth, but even then you may lose time reintegrating yourself into each task. Often, completing a task before you move to another can save you time.

CROWD MENTALITY

Much of our world is online and crowd driven. Add time pressures to the mix and we end up with impulsive, irrational decisions that are made carelessly, without contemplation. Stock market crashes, fads, and riots are caused by a crowd mentality. We lose ourselves in the presence of a crowd. It’s called “deindividuation” in social crowdpsychological terms. When we get caught up in the excitement and momentum of a crowd, we lose our judgment and do things we wouldn’t normally do on our own. Riots after sporting events are a good example. Most sports fans would not smash car windows and set fire to things on their own, but when they get caught up in the post-game fury of a stadium full of fans, they can find themselves doing extreme things. The same is true in business.

Online interactions have a similar effect. People deindividuate when they are online. For example we’ve all seen people post comments on blogs or send emails that they would never say in person. We feel less personally accountable online, similar to when we are in a crowd. And what are we doing online? Creating crowds! People these days define their value by their numbers of followers, friends, likes and retweets. The news reports on what is “trending now” on social media to acknowledge what the largest numbers of people are doing and saying. It may be “trending” but it doesn’t mean it is a good idea.

SOCIAL COMPARISON

People feel better about themselves when they are better than someone else. When you get a B on a test, you feel better when you find out someone else got a C. Social comparison is a way to feel better about yourself by thinking or saying negative things about other people. Gossiping is the quintessential example.

The flip side of putting others down to make ourselves feel good is to compete with others to do better. To feel good, we want to outdo our neighbors, coworkers, classmates, FB friends, and Tcompetitionwitter followers. For example, if my friend is taking 4 AP classes, I should take 5. If the competitor is decreasing costs by 5%, we should decrease by 10%. If my coworker works 10 hours a day, I should work 12. If my teammate runs 12 miles a day, I should run 15. This also manifests with opinions and positions. If others in my political party are moderately liberal/conservative, I will be more liberal/conservative to show I am better or more committed to the group. After enough people do that, the party is broadcasting extremist statements. This is called “group polarization.” We all know what calamities that can lead to.

It’s tpauseime to stop and think.

It’s time to slow down and check our work to avoid careless mistakes. It’s time to pause and make well thought-out decisions to make sure we are doing what we want to do. It’s time to question the crowd to see if it is going in a direction we think is valuable for us to follow. The cost of not thinking is far greater.

Saying “No” to your Boss without Hurting your Career

by Joanie Connell

For most of us, it’s no on the handhard to say “no”—if not all of the time, at least in some situations. One such situation is when you think it might harm your career. Ironically, sometimes, not saying “no” might actually hurt your career more. Examples are: when you are being asked to do something illegal or immoral, or something that you will not succeed at. You might not succeed at a task because you are too busy to do it well or because you aren’t skilled enough to do it well. In either case, it will reflect badly on you when you fail.

When I tell people they need to be able to say ”no,” they often balk and say that they can’t say “no” to their boss. Then I say, “How about if you say ‘yes’ to your boss?” Their eyes light up when I tell them it’s possible to say “yes” and “no” at the same time. Try the models below.

  • “Yes. If I do this then I won’t be able to do that… Which do you think is more important?”
    • Boss: “Could you take on the budget proposal for the new product we’re developing?”
    • You: “Yes, absolutely. I’m currently working on the financial analysis of the old product though. If I take on the budget for the new product, I won’t be able to finish the analysis as quickly and I had originally estimated. Which do you think is more important to do first?”
  • “Yes. If I do it in that timeframe, however, it won’t be my best work. I could offer to do this instead… What do you think would be best?”
    • Boss: “Could you write up the 40-page report by tomorrow morning?”
    • You: “Yes, I’d be happy to. If I write 40 pages in one day, though, it won’t be polished. If I had till the end of the week, I’d have time to go over it a second time and proofread it. What do you think would be best?”
  • “Yes. Would it be okay to delegate that to …?”
    • Boss: “Could you manage the offsite planning?”
    • You: “Yes, I’d be happy to be responsible for it. Would it be okay to delegate the work to Marnie? She’s looking for more leadership opportunities and is good with logistics.”

These exact phrases may not fit with your style, but you get the idea. You accept the work with full disclosure of the sacrifice (not completing other work, not your best quality work, or not you actually doing the work) and give your boss the opportunity to decide what is more important. If your boss says, for example, that she doesn’t need your best quality on a 40-page report, just a rough draft, or maybe even an outline, then you’ve brought it down to a reasonable task in a short timeframe. If your boss says he needs it to be top quality and would rather wait, then you have turned it into a reasonable timeframe to complete the task.

Bosses don’t want their people to fail. It reflects badly on them too when you fail. They want the work done and done well and done on time. You need to speak up when you won’t be able to deliver. A positive way to do that is to help the boss find solutions, rather than raise obstacles. Bosses like solutions. And the bosses who don’t like to hear “no” like to be able to decide what is more important. If you give them that opportunity with the models above, then you will be able to keep your head above water too.

Rearing Resilience

“It is easier to build strong children than to repair broken men.”

–Frederick Douglass

1st place ribbonI went to a youth music competition this weekend.  There were 12 musicians in the age category I watched.  They varied a great deal in their ability.  After an hour of performances, the judges announced the winners.  There were 2 First Place winners, 4 Second Place winners and 6 Third Place winners.  Everyone won.  I overheard one of the Third Place winners asking her parents if Third Place was really Last Place.  The parents looked at her, not knowing what to say as she took the medal off her chest and put it away.  She wasn’t fooled.

crying babyThere is a movement toward sparing the feelings of children when they lose, make a mistake, fail, or simply aren’t the best at something.  We raise our children in a culture where “everyone’s a winner.”  However, when they grow up and find out that only very few people get into the best colleges and very few end up in their dream jobs right out of school, they are dumbfounded and caught off guard, and they crumple in defeat.  We aren’t preparing our children to survive in a world where everyone really isn’t a winner.

Resilience is probably the most important quality for success at work and life. Being able to stay strong, even in the worst of times, is what leads to success. It is the rare individual who goes through life without adversity. In fact, it would be surprising if there were any such people. Some people face greater adversity than others and have to be strong to get through it. For example, think of cancer survivors, kids who have escaped from neighborhood gangs, Holocaust survivors, or the Lost Boys of Sudan. How did they endure? What kept them going? It was inner strength and optimism. They never gave up.

Hopefully, none of us will have to face such severe adversity, but it is important to be able to get through what adversity we do encounter. How do we develop the inner strength to stay strong? We train for it just like we do for everything else. We start out small with low levels of adversity, such as not getting the piece of candy we want, working out our differences with our school friends, and learning from a failing grade that we have to study for tests. We move onto bigger problems to get through, such as handling the pain of breaking an arm or getting stitches, denting the car and having to pay for it ourselves, and working through our first heartbreak. Then we move onto even bigger things, such as learning to live with a difficult roommate, turning down an evening out with friends to save for the rent, and sticking it out at a miserable summer job. These experiences prepare us for the critical ones that require us to draw from our strength to get through trying circumstances and forge optimistically ahead.

Successful people are resilient.

Failing to Succeed

by Joanie Connell

successWhat does it take to succeed? Isn’t that the burning question? Of course, it depends on what your definition of success is to begin with. Is it money, fame, power, happiness, self actualization? The first step in success is to know yourself—what is important to you, what do you value, what are you good at, what are you not so good at? Failing that, you will never truly succeed.

I was an electrical engineer before I became a psychologist. I went into engineering for all the wrong reasons. They seemed like the right reasons at the time, because I was young and inexperienced, and I was looking for a short-term solution. I wanted to make money, and my parents made it abundantly clear that I needed to be able to support myself upon completing college.

I spent many a night flipping through the book of college majors, looking longingly at music, French, and sociology, but questioning what kind of money I would make if I went down one of those paths. Given that I was good at math and computers, I chose the one major I could find where I could start out as a professional with only an undergraduate degree: electrical engineering.

I did succeed at making money, but I was not happy. I had to go back and do a lot of soul searching. I bought the book “What Color is your Parachute?” and diligently worked through all of the exercises. I explored and prioritized what was important to me. I solicited feedback from friends and family on what they thought I was good at and what would be a good fit for me. I interviewed many professionals in a variety of jobs to see if these jobs would be a good fit for me. Through this process, I decided to become a communications consultant. I learned that I needed to go back and get a Ph.D. to be successful at that. I learned that I liked to solve problems (like an engineer) but they needed to be people problems. I learned that I did have to make enough money to support myself, but not as much as an engineer. I learned that I needed to make a positive impact on the world (even in a small way) to be successful in life. That’s what is important to me.

A few years back, during a coaching session, an executive told me that I had found my calling. It was the best compliment I have ever received at work. I realized then and there that my strength and passion are to help people reach their potential in life. I’ve gone through countless failures to get to that point, and it hasn’t been easy.

Like with exercising and diets, people want to learn the shortcut to failuresuccess. The New York Times Bestsellers list is full of books on how to be a successful leader. The problem is: there is no formula for success. It takes discipline and hard work, and every successful person will tell you that they have failed.

Even the Harvard Business Review has dedicated a special issue to failure. Every article talks about major business failures. The key message, however, is to learn from your failures.

Proctor & Gamble’s former CEO, Alan Lafley, says that, in his experience, “we learn more from failure than we do from success.” He says that 80% of new product innovation fails in the industry of household products. It wasn’t until he had P&G go back and systematically study their failures over the past 3 decades and define what success meant, that they understood why. Needless to say, they’ve improved their success rate ever since.

People are the same way. Instead of forgetting the past, we need to learn from it to do better in the future. We also need to take risks to succeed. If we wrap ourselves up in a security blanket, we will close ourselves off from opportunities to grow.

In the end, failing is important to succeed.