Saturday, December 08, 2007

Job Satisfaction, Annuities and Hard Work

Ben Stein is one of the columnists on Yahoo Finance! that I read periodically. Recently, he wrote a piece called Arm Yourself for Job Fulfillment and Retirement Bliss. In the article, Mr. Stein shares his perspective on concepts of true job satisfaction, financial security via annuities, and how wealth building requires hard work. While I agree with his points of view on job satisfaction and hard work, I am not comfortable with with purchasing a lifetime annuity. Here are my thoughts in these areas:

  • Job Satisfaction. Mr Stein writes that real job satisfaction results from meaningful and challenging work, where people genuinely respect, value and support each other. I can attest that my best projects have been ones where these criteria were met, both ways. On the other hand, my most challenging assignments were those where these criteria were not met either one or both ways.

    If I should ever start a company, I would hope to make these characteristics the basis of longer term business partners and business colleagues.

  • Hard work. Mr. Stein acknowledges that building and keeping of wealth requires hard work. I fully agree since I have not found an easy path to riches. For me, it is been one of hard work, discipline and some sacrifice. I am always skeptical of people who promote or are looking for "easy" ways to get rich.

  • Lifetime annuities. Mr. Stein recommends that using a lifetime annuity to guarantee income late in life, especially if one can no longer manage one's affairs. While I recognize the simplicity of this approach, I think it ignores the risk of a losing the money due to potential mismanagement by a financial institution. The recent subprime debacle has shown me that even apparently strong companies can make financial mistakes that can put their company out of business. In fact, the one lifetime annuity for which I will be eligible in the future, Social Security, seems to be constantly at risk of going away.

    I much prefer to count on my own trusted resources or advisors to manage my retirement funds. In addition, I may consider selling my house as source of income late in retirement.

  • Overall, I think Mr. Stein was on target for two topics. For the lifetime annuities, I would want a much better guarantee before considering putting my money with a single insurance or financial company.

    For more on Reflections and Musings, check back every Saturday for a new segment.

    This is not financial advice. Please consult a professional advisor.

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