Job Security or Financial Security? Which is the Best Approach and How to Choose?

If you could have a choice between job security, financial security, and financial freedom, which one would you choose? Now for a gut check, where are you currently? Are you at job security? Are you a financial security? Are you at financial freedom? And if you’re not where you want to be, what’s preventing you from moving forward?

In this blog, we’re going to discuss what each term is, and provide you with the mindset shift that you may need to take you and your life to the next level.

What is job security?
For those who lean toward job security, the most important thing to them is having a steady income and being in what is perceived as a safe place. It protects them against economic downturns. They may have some type of 401(k) plan or some type of retirement plan linked to their employer. They tend to feel like they’re secure in their job.

However, as everyone knows, a job can go away at any time. There can be economic changes, economic disruptors that make an industry obsolete that the person may be working in. Companies fail all the time. There’s DSOs that do very well, and there’re DSOs that crash and burn and go bankrupt. With that said, no job is actually secure. Job security is probably the most risky position to be in.

What is financial security?
I know some people that have millions of dollars in their retirement account, but they still feel insecure, right? Why? Let me give you an example. One of my friends, a dentist, just sold his three practices. He was bought out by a private equity company for $12 million. After capital gains taxes, he still netted almost $8 and 1/2 million. Now he has literally millions of dollars, which is a small fortune for 99.9% of the population, but he still feels insecure. Why? Money is tied up in the market. The market is volatile. The stock market is a casino. He doesn’t know where his wealth will be when he wants it.

Second, he’s not getting any meaningful cash flow. And the cash flows that he does receive from dividends are subject to taxes. He feels insecure because his money is sitting in a retirement account linked to the stock market. What will happen tomorrow? What will it be worth tomorrow? Nobody knows.
So you can see, even the guy that has millions of dollars in the bank, still has some insecurity with what exactly he should do with his money. He’s still subject to the volatility of the stock market casino.

When you look at the income levels of somebody that values job security and somebody that values financial freedom, they might have the same training and earn the same amount of income. The only difference is a shift in mindset. That very small shift in mindset compounds into very large differences in people’s lives when you discover financial freedom.  Check out our next blog on financial freedom!