The Perks and Trials of Working (Trading) for Yourself

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The Perks and Trials of Working (Trading) for Yourself

There is a great allure to ditching the office and venturing off to make a living on your own. Trading is a great way to earn a living, but it isn’t all roses and it isn’t easy. If you are considering trading as a primary income stream, or have recently begun a career as a stay-at-home trader, it needs to be thought of as a business. In essence, you need to become your own boss and make sure you do what needs to be done–which includes potential research, developing a trading plan (this should be completed before any trades are made) finding trade setups and following your trading plan. Simple enough, but it isn’t quite as easy as it sounds. Here are some of the trials I have faced, and overcome, over the last decade as an independent trader…as well as some perks which will hopefully motivate you to endure the tough times.

  • Myself! I originally traded for a firm, but then decided to go off on my own. I misjudged how much discipline it takes to get out of bed each morning, and actually work, when you don’t HAVE TO be somewhere. I floundered for a couple months, until I created a routine for myself. Just like your normal morning routine which gets you out of bed and into the office, you need to create a similar routine for getting out of bed, and making your way to your computer to trade. I established firm rules about getting up at the same time every day, eating breakfast, checking emails and then trading at the same time each morning…just like being at work by a certain time. The routine greatly helped get me get used to working for myself and building my disciple.
  • Distractions! While I absolutely love to trade and watch the markets, let’s face it, there are a lot of distractions at home, especially when there is no boss around to tell you to get to work. As mentioned when I decided to trade independently from home, the first few months were filled with distractions—I ended up sitting on the beach, I watched TV, surfed social media, wrote articles–all sorts of things, other than trading. Once again, creating a routine for the day helped.

I check emails and “internet things” before starting to trade. I then trade for about 1 to 3 hours. Then I write for an hour as I enjoy writing about the markets. Then I take a couple hours off, eat and go to the gym or out for a run. When I get back I put in another hour of writing and about 15 minutes looking through charts which may set-up well for the next trading day. All in all, I force myself to put in about 4 to 5 hours of “work” a day. Less than that I find I can lose focus, more than that I also lose focus, and end up getting distracted anyway. So I found a compromise, and developed and a routine that lets me do my job, but also have time and freedom to enjoy my life…which is what trading is all about anyway.

  • Risk Control! When you trade from home, and are trading your own money, no one is going to prevent you from making a disastrous split second decision. You know there may be consequences, and your spouse may even monitor what you are doing, but in a split second a bad decision can cost you everything. Deeply understand this. When you trade for yourself there is no back stop, except for the back stops you put in place. I apply risk controls on myself–I don’t risk more than 1% of my account on a trade, and I stop trading if I have lose more than 3% of my capital in a single day (or roughly three trades in a row). You’ll come up with your own rules, but DO create them. Trading is a business, one bad day doesn’t matter. There is always tomorrow…as long as you keep the bad days small.
  • Isolation! Working by yourself can get kind of boring after a while. This is an easy fix though. During your couple hours off during the day, leave the house. Engage in lots of other social activities, or you may even opt to join trader chat rooms/discussions online while you trade to give yourself some social contact while you work from home.

I won’t spend much time going over the perks, since that is why most of you want to trade in the first place.

  • Time: For the most part, you don’t need to sit in front of your computer all day. Typically a few hours or less is all it takes to day trade. Most of the day the price action isn’t great, so trade a time where you find the best opportunities, and leave the crappy times for other traders to lose money on.
  • Freedom: Working for someone else you don’t ever feel fully in control of your life. When you work on your own you have that freedom. Keep in mind though this is a double edged sword in some ways. When you work on your own there are no excuses, and no one to bail you out if things go awry. Freedom is also dependent on being able to make enough to money to live, but most new traders struggle and can’t do this.
  • Money: Many traders start trading to get rich. I highly advise against this attitude. If you can make a living as a trader you are in the top of 1% of the traders in the world–already a tall order. Strive for trading consistency instead, and a high quality of life, which includes lots of free time to do things you love and also wake up each morning to do something you love to do –trade!

Reviving Blue Collar Work: 5 Benefits of Working in the Skilled Trades

A couple weeks ago, I outlined and (hopefully) debunked four common myths about skilled labor. While these stereotypes about blue collar work may have been true 50 years ago, they simply aren’t the case in today’s world.

In the 90s and early 00s, everything was about the business world. Wall Street was going gangbusters, this new fangled thing called the internet was taking off, and dream jobs were those in which you sat in an office with a computer and made millions. Those jobs were not terribly difficult to come by. Today’s youth have those same notions of where the good jobs are, but nowhere near the same success in finding them. While the job market is improving from the economy’s nosedive six years ago, it’s still not what it was pre-recession, especially for new college graduates, for whom the unemployment rate is at 8.5%, versus 5.8% for the workforce as a whole. It’s time young people looked outside the white collar box when it comes to landing a steady, good paying job.

My aim with this article is to convince you that blue collar jobs are in fact what some young men ought to aspire to, just like they aspire to be a lawyer or banker. I’m not trying to convince you that blue collar jobs are better (though in some cases they will be, just as in some cases white collar jobs will be better), but that they are simply on par with office jobs by nearly every measurable factor in terms of what makes a career a “good” one. That’s the stereotype that most needs breaking — that blue collar careers are beneath white collar ones and less desirable. The simple reality is that they aren’t, and here are 5 good reasons why:

1. Trade School: Cheaper & Shorter

One of the biggest benefits to working in the skilled trades is the education required. While there are many positives to going to 4 years of school for a bachelor’s degree, there are also a few big negatives, including cost. Since 1990, tuition costs have risen over 300%, far outpacing the growth of the economy. When costs rise at 7-8% per year, while inflation grows 2-3% per year, you end up with a product that becomes unaffordable. For many folks, though, that unaffordability isn’t standing in the way, because student loans are easy to come by. Because of that, about 2/3 of students with bachelor’s degrees are leaving college with debt that averages $26,000 per student. That’ll make for a $300 monthly payment for a decade. (From experience, it’s a little depressing when your student loan bill is more than your car payment.) All in all, your average bachelor’s degree is likely going to cost you over $100,000 — closer to $150k if completely financed through loans.

The vast majority of training programs for the skilled trades, on the other hand, last from 6 months to 2 years, and will cost just over $30,000. Even if that cost is entirely financed by student loans, you’re looking at a total of $40,000, which is still a savings of at least $110k!

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This makes for a huge opportunity cost for those going to 4-year colleges. You’re spending an extra 2-3 years in school, paying tens of thousands per year, while the tradesman is already graduated and earning money (in some cases, making six figures as a 21-year-old).

One final factor is simply that some 18-year-olds aren’t ready for a college environment. You’re thrown off the cliff from your warm and comfortable home life into total independence. It’s not an easy transition for anyone; in fact, about 40% of all undergrad enrollees will drop out before earning a degree.

Trade school offers a nice on-ramp to independence. You’ll often stay close(r) to home, you receive real-world, hands-on training from the get-go, and you aren’t spending every waking moment with folks your same age and in the same position in life (which can make for a difficult social transition once out of college). Again, there are certainly benefits to attending a 4-year university (we’ve outlined the pros and cons here), but the big pros of trade school are that you’ll save a lot on tuition, start being able to make money sooner, and can start taking measurable steps towards adulthood more quickly.

2. Compensation: Trades Jobs Are Well-Paying

Even those who are concerned about the hefty price tag of college still feel that while the cost may be high, it’s always worth it, since it will increase their lifetime earnings potential.

This worry over compensation definitely looms looms large in holding teenagers back from considering trades work. And while money is not the most salient factor in determining a career, it is certainly important. The assumption is that the income ceiling is higher for white collar work than it is for blue collar. And frankly, in an absolute sense, that’s true. Those who are pulling in a million a year aren’t tradesman; the vast majority are college graduates. But these very wealthy individuals represent a miniscule percentage of the workforce.

If we look at averages, which is where most of us are and will be in terms of our career, the paychecks for trades are either at or above other careers. One study of the trades from just the state of Michigan found the above to be true — that the ceiling was higher for white collar, but the median was actually higher for blue collar. The range for the skilled trades (per hour) was $13-$34, for a median of $21/hour. For all other occupations, the range was $8-$39, for a median of $16/hour.

Now, could those numbers be skewed, especially on the low-end, by workers who only have a high school education? Absolutely. So what happens if we just compare national averages for wages earned by college educated white collar employees and tradesmen? They’re almost the same, with white collar folks coming in at $1,000 more per year. Over the course of a 40-year career, that ends up as a fair amount of money. But when you factor in college costs, plus a few more years in the workforce, that difference actually begins to favor the blue collar worker.

Let’s take a look at the starting salaries of the largest skilled trades careers, and you’ll see they match up against the average starting salary for college grads (which is reported to be $48,000 – and let me tell you, I don’t know a single bachelor’s degree holder who started out at that high of a salary!).

  • Maintenance Mechanic: $38,000
  • Aircraft Mechanic: $49,000
  • Sheet Metal Mechanic: $47,000
  • Driver: $51,000
  • Electrician: $44,000
  • Painter: $35,000
  • Machinist: $37,000
  • Pipefitter: $49,000

Remember, those are the most common blue collar jobs. If you look at the higher end of trades work, you’ll see wages that are much higher than college grads:

  • Locomotive Engineer: $63,000
  • Elevator Repairer/Installer: $73,000
  • Subway Operator: $60,000
  • Nuclear Technician: $69,000
  • Aerospace Operations: $61,000

Remember, these are base salaries that come just as a result of your having the proper skills. Just like with white collar work, there are many trades fields in which you can move up the ladder and earn far more. If you show management skills and big picture vision, you’ll receive promotions and raises, just as you would in an office setting. You can also start your own business, and use your entrepreneurial, creative, and customer service skills to set yourself apart from the pack, at which point your income potential is as high as your ability to hustle.

You may be surprised to learn that being a tradesman could get into that somewhat hallowed six-figure salary range in far less time, and with far less money spent on schooling, than just about any other field of work. And you could possibly make even more than that; think a plumber can’t make a million bucks a year? Think again!

Beyond wages, there are many other factors that actually play a more important role in workplace satisfaction. Which leads to our next point…

3. Job Security: The Skilled Trades Can’t Be Outsourced

Compensation is important, but only the third most important factor in overall job satisfaction. The first is actually “opportunity to use skills and abilities” (more on that below) and the second is job security. So while pay in the trades may be commensurate with white collar work, for some, these other factors will boost this type of work ahead of occupying a cubicle.

In our new economy, complete job security just doesn’t exist. Anything can happen to any company, and you can be let go. But some jobs are a lot more secure than others. Information and tech jobs are particularly vulnerable to being taken over by robots or moved overseas, but even once-secure jobs in the medical and legal sectors have begun to be outsourced as well.

The trades, on the other hand, simply cannot be outsourced. While the world may not always need bloggers, it will always need mechanics, electricians, plumbers, welders, etc. When you’re locked out of your house, you won’t phone a customer service line and deal with robots trying to resolve your issue, you’ll call a locksmith (unless of course you can pick your own lock!). The roads and bridges in this country will always be built here. Our skyscraper projects won’t be constructed in France and shipped over (that was a one-time deal with Lady Liberty). While jobs in the information/tech/customer service sectors can always be shipped away, the careers that require literal hands-on work cannot be.

One of the points that Mike Rowe hammers home in his book, Profoundly Disconnected, is that Americans are disconnected from the things that keep our lives and society running on a daily basis (hence the title of the book). Without the trades, our society would literally crumble. Roads/bridges would go into disrepair. Cars would break down and not be fixed, and new cars wouldn’t be made to replace them. Our electrical grid would shut down and we’d lose power. Plumbing would break down or back up, and we’d all be swimming in our own waste. Not a pretty picture, is it? It may seem sort of dystopian, but in fact our infrastructure is falling apart before our eyes. The American Society of Civil Engineers rates it as a D+. 60 Minutes, just this week, did a feature on America’s crumbling infrastructure. This is an incredibly salient issue. Without more skilled tradesmen, it will only get worse.

Of course, as 60 Minutes points out, politicians need to fund these projects, to pay these tradesmen, to fix our decaying roads and bridges, but that’s a whole ‘nother subject. Yet even if these projects don’t get funded for a long time…

Listen to my podcast with Mike Rowe about the trades:

4. Availability: There Are Plenty of Jobs For the Taking

Trades jobs are not only very secure, there’s a whole lot of openings for them as well.

In the last post I briefly mentioned the skills gap here in America – the state of having more jobs available than workers who are trained and able to take those jobs. A big part of that reality is simply that there are more tradesmen retiring than entering the field. Among all jobs in the US, workers aged 25-44 make up about 48% of the workforce; among skilled trades jobs that number is 46%, a mere 2-point difference. When you look at the 45-54 age range the picture is very different. That group makes up 23% of the general workforce, but 32% of skilled trades, meaning that millions more tradesmen will be retiring in the next 15 years than white collar professionals.

For the blue collar worker, there are jobs to be had. They may not be in your city of choice, but that’s a reality faced by much more than just tradesmen. Certain industries flock to certain geographical regions (show biz and Hollywood, fashion and NYC, etc.), so to be successful you may have to move. According to some estimates (including Mike Rowe and his foundation, which works to put tradesmen in good careers), there are literally millions of unfilled jobs right now in the skilled trades, with many more to be created in the years to come.

In fact, in just the next two years, an expected 2.5 million middle-skill jobs (those that require less than a bachelor’s degree but more than a high school diploma) will be added to the workforce, accounting for an incredible 40% of all job growth. The city of Houston alone is expected to add 100,000 jobs in that same time period. North Dakota is in the midst of a petroleum boom, requiring not just oil/gas tradesman, but also electricians, plumbers, carpenters, etc. to build up the infrastructure. Atlanta has a booming film industry that employs almost 80,000 people, with many more needed for the technical aspects like setting up lighting and sound, set construction, etc.

All over the country, the skilled tradesman is in demand.

5. Intangibles: The Satisfaction of Blue Collar Work

Above, I mentioned that the number one factor in overall job satisfaction is being able to use your skills and abilities. It was in 2020 when that factor overtook job security for the first time, just four years removed from the economy crashing. People are quickly discovering that feeling happy and fulfilled at work is incredibly important.

Do you want to spend 40 years of your life bored and dissatisfied for most of your day? Obviously not. But that’s what 70% of Americans feel at work, with highly educated people actually being more likely to be disengaged with their workplace. While boredom can obviously happen at any job, the tradesman who’s working with his hands all day simply has less opportunity for disengagement, as boredom at work often happens when there just isn’t enough to do. Idleness is not often a problem for the blue collar man.

In the last article, I mentioned the false notion that one has to “follow your passion” in order to be happy at work. This is often taken to mean that you should find something you enjoy, then acquire skills in that field. Actually, it works the other way around; find a way to use your skills, no matter what those skills are, and you’ll be passionate about your work. I won’t go into that at length here, but give that section a read from the previous piece.

Other intangibles to be mentioned are things like autonomy at work and work/life balance. In an age where most people’s jobs are accessible by internet and smartphone, disconnecting from work is hard to do. You see emails come in at night, and you respond almost without thinking about it. You hop on the computer for a second, and it turns into an hour or two of work because it’s right there, and seems urgent. You become a slave to email, and to your higher-ups, even if that’s not the intention. When you work with your hands, you can come home at night and actually disconnect from your job. You aren’t always “plugged in,” which gives you a better chance to refresh your body and mind for the next day’s work. Of course, you can choose to work after hours if you’d like – but you’ll also be able to charge your customers a premium for your services if you do!

One final factor is simply the satisfaction that can come from doing something tangible and concrete with your time. Fixing things, building things, seeing the actual, physical fruit of your labor; this is often far more personally fulfilling than spending 8 hours on an excel spreadsheet. As author Matthew Crawford notes in a great article in the New York Times, “Many of us do work that feels more surreal than real. Working in an office, you often find it difficult to see any tangible result from your efforts. What exactly have you accomplished at the end of any given day? Where the chain of cause and effect is opaque and responsibility diffuse, the experience of individual agency can be elusive.” In fact, in our modern economy, 40% of jobs are related to coordinating and mediating rather than actually doing something directly.

The woodworking hobbyist pursues this pastime because it feels really good to build something. The tinkerer of cars loves doing it because he can see something dead come to life, as a product of his own two hands. There is a satisfaction and fulfillment that comes from manual work that simply cannot be achieved in any other setting. For some folks, manual work will remain a fruitful hobby, but for others, it can blossom into a meaningful and long-lasting career.

Conclusion

When we’re weighing which types of jobs to apply for, or even which to accept from multiple offers should we be so lucky, the differentiators often come down to benefits. Pay, job security, balance, work environment, etc. For too long the skilled trades have been neglected as not having any benefits. Thankfully, the tide is turning, and people are starting to see that blue collar work offers some real advantages over white collar work. There are jobs available, pay is good, job security is excellent, and the satisfaction may be greater than being in the information industry.

In some cases and for some people, better jobs and benefits will come as a result of a 4-year degree and being in an office setting. That’s just fine. But for some folks, that’s just not the case. My hope is that the young men reading this, as well as the seasoned men considering a career move, will weigh all their options, and determine what’s best for them and their future.

Pros and Cons of Working for a Small Company and Finding Small Firms

Job searching is a numbers game. To successfully find employment, you need to target a wide range of employers. The more resumes you distribute, and the more you network, the better chance you have of landing interviews, and a job.

Why You Should Think Small

Most candidates seeking employment often ignore smaller employers and focus their efforts on larger firms.

That could be a big mistake: Small firms may be in a better position to hire you, and there are more of them. According to the U.S. Small Business Administration, small businesses represent more than 99.7 percent of all employers. They also employ more than half of all private-sector employees, pay 44.5 percent of the total U.S. private payroll, and generate about 75 percent of net new jobs annually.

Small companies tend to have business plans progressive enough that they can succeed regardless of how the economy is doing. They tend to be nimble and excel at finding their niche, regardless of the field. Also, small firms usually don’t have large overhead that is burdened by big companies with fancy addresses and designer lobbies.

The Pros of Working for a Small Company

Being employed by a small-size company offers many benefits to your career:

More visibility

Work roles at small companies are often less specialized than at large firms. That means employees get to wear several hats, interact with staff more often and are afforded a 360-degree view of company-wide operations. Plus, in a smaller organization, it’s easy to interact with c-suite executives and the decision-makers. Because employees have more visibility, it is often easier to advance in a smaller organization.

Experience in a Variety of Areas

Because you’re wearing many hats, you’re likely to gain knowledge and insight beyond your role. Small company employees often gain multiple skills and areas of expertise to enhance their resume.

Increased Flexibility

Small firms may also have more flexibility when it comes to considering alternative work arrangements such as flextime and job sharing. The dress code may also be more relaxed.

Your Co-Workers May Be Your Friends

At smaller companies, it’s common to form deep bonds with your colleagues. Collaboration opportunities abound since employees are so likely to do work that goes beyond their job description.

It Offers an Entry-Point to the Industry

Working for a small company can be a good stepping-stone to a larger employer in the same field.

The Cons of Working for a Small Company

But it’s not all rosy. Here are some potential downsides to employment at small companies:

There May Not Be Many Career-Building Perks

Small firms may have fewer formal training programs, and their benefits packages can be more limited. Some HR processes (like maternity leave policy, for instance) may not be set up, which can be challenging.

Sometimes, Your Growth Will Be Limited

The option to transfer to other departments may be limited or non-existent. You may also encounter less opportunity for growth and promotion at a small firm, and most likely, there will be fewer people who can serve as mentors. Plus, at a smaller company, if you do not get along with your co-workers, avoiding them may be difficult.

Smaller Companies Can Be Unknown Entities

A large company often comes with known workplace culture and reputation. That can be helpful when you apply to your next role — recruiters and hiring managers will be familiar with your current company. With smaller companies, you may find yourself spending time in your interview explaining the company, rather than talking about your accomplishments.

In general, if you prefer structure ahead of flexibility, a larger company may be a better fit.

How to Find Small Companies

If you want to target small firms, the INC 5000 list is a great starting point. The entire list is accessible for free online and updated annually. You should also do some research on your own because you never know when the tide will turn and a company will downsize, relocate overseas, or go out of business.

Vault.com has a searchable database of companies as well and is worth looking at. Job seekers can look up a company by name or search by industry, city, state, country, the number of employees, and revenue. You can also get career advice and help with resume writing. You may even find message boards where you can get the inside scoop on the company culture. Other resources for identifying small emerging companies include local chambers of commerce and the business section of your local newspaper.

Information on new companies and updates on local businesses are typically published regularly.

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