The Most Important Investments You Can Make Are Those That Increase Your Value

Investing is an important piece of the puzzle when trying to increase your net worth. You can invest in stocks, bonds, index funds, property or crypto. But if you’re starting from scratch, without inherited money, you’ll need a decent income in order to invest. And the way to increase your income is to increase your value. When it comes to  increasing your value, on the job market and beyond, these are the factors you need to be looking at.

Your Education

Investing in your education can pay off, but not always. If your sole aim is to increase your value in the job market think long and hard about the type of education you need and what the true return on your investment will be. College degrees, in the USA at least, lead to long-term debt for most people. They also lead to higher salaries, overall, but a lot depends on other factors, and as with any statistics, it’s worth treating the numbers with some skepticism.

There are plenty of college educated people on low salaries, and plenty of workers with no degree and a decent income.

Remember that not going to college correlates with other factors that might have an even bigger impact on future income, such as coming from generational poverty or experiencing teen pregnancy. Put simply, it pays to consider your ‘big picture’ circumstances, intended career path, and the type and amount of education you need to get there, rather than buying into the oft-repeated but inaccurate idea that if you don’t go to college, you’ll never make it out of a minimum wage job.

We’ve discussed before here at Wealthtender which degrees result in higher salaries. We’ve also talked about less conventional ways to get a degree and how to find cheaper routes to the credentials you need. In a world where, for many people, college is an investment in their future career prospects, rather than a fun experience, it’s important to look carefully at the real impact your formal qualifications will have on your future income.

Your Skill Set

Your education and your skill set may be linked, but they can also be looked at as separate assets, with distinct investment needs. We’ve talked before about some of the most lucrative freelance skills that you can develop, and that’s worth considering if you want to freelance or run a side hustle. Your skill set will also impact your value on the open job market, your chances of promotions at work, and in some industries, the level of your bonuses and commissions.

Building skills outside of formal education can often be what gives you the biggest ROI, because the most valuable skills aren’t always the most expensive to learn. Skills can be learned in one-day workshops, online courses, paid-for-by-your-boss training, and on-the-job experience. Sometimes they can be learned by watching enough of the right YouTube videos. Learning valuable skills can be free, cheap or at the very least a lot less expensive than that college degree. That’s why the ROI can be much greater.

Hard skills that you use in your chosen profession are the most marketable, especially if they’re rare. But don’t overlook soft skills like people management, communication and negotiation. There are times when they’ll really pay off too.

Your Contacts

When it comes to getting the best opportunities, they say it’s about who you know. They’re wrong. Sort of. It’s more about who knows you and what they think of you. This hit me in college when I asked my professor, who was very well respected in the industry, for a reference.

I went to my favorite professor, not because I thought she’d necessarily give me a great reference but because I knew she was capable of giving me an honest and specific one. I knew her, but she also knew me. I’d engaged with her classes, but I’d also used her office hours, dropped in with questions about assignments or upcoming exams, and actually expressed opinions on the topics we were studying. She expressed, with tact of course, how nice it was to write a reference for a student she felt she really knew, and commented on how often she had to write references for ex-students she could barely place.

She knew me, and she thought highly of me. Unsurprisingly I got offered the job I needed the reference for. Investing time in expanding your network and developing your contacts is a great way to increase your value. Take the time to connect with your teachers, professors, colleagues and fellow students, especially those who will end up in a similar industry to you. Spend some time, and money if needed, attending industry events, training courses, and even cross-departmental activities within your company. Make an impact. As good a one as possible. Don’t focus on who you know. Focus on who knows you (and what they think of you).

Your Experiences

Experiences make you who you are, which definitely matters. But they can also add value to what you offer. That summer in Spain means you now have truly conversational Spanish, rather than classroom Spanish. Playing (or coaching) that sport for so long made you an expert in teamwork (or leadership). A random experience can just happen to tie into a question you’re asked at interview, or provide you with a story to tell your boss that makes you that little bit more memorable. A shared experience can enable you to relate to a colleague’s situation, and maybe provide a solution or resource they need. Or maybe a specific experience just gave you the confidence you need to pull off a big product pitch or steer an important meeting in your favor.

The ROI on experiences isn’t always obvious, immediate, or tangible. But it’s there. Invest in them. Invest your time, energy and money. If you can purposely pick experiences that also pay off in terms of skill development or relationship building, then great. Two (or three) birds with one stone is always good. Just be aware that your experiences may add value and provide future pay-offs in ways you don’t expect, and couldn’t possibly have foreseen.

Karen Banes is a freelance writer specializing in entrepreneurship, parenting and lifestyle. She writes articles, website content, ebooks and the occasional award winning short story. Her work has appeared in a range of publications both online and off, including The Washington Post, Life Info Magazine, Transitions Abroad, Brave New Traveler, Natural Parenting Group, and Copia Magazine. Learn More About Karen