How to Make Friends with Your Finances During a Life Transition

“Kevin” was experiencing sticker shock. After years of life in the corporate world, he had accumulated a healthy nest egg. The kids were grown and gone. Time, he said, to launch an Internet marketing business.

“But everything is so expensive!” he exclaimed. “Take this weekend seminar. Over four hundred dollars for two days? That’s outrageous!”

When you’re experiencing a major life change, it’s hard to evaluate prices. You feel like you’re spending big bucks every day. Travel. Moving. Resume Services. Business Start-up.

But I encourage clients to banish words like “cheap” and “expensive” from their vocabularies, forever. Instead, I encourage everyone to respond to sticker shock with three questions.

(a) How does this price relate to the market?

Before hiring a consultant, attending a seminar, choosing a moving company or buying computer equipment, do some research. Learn the going rate. Sometimes you’ll get increased value by paying more. Sometimes you won’t. But you should be suspicious of offerings that are way below or way above market price.

Author Barbara Ehrenreich, posing as a corporate job hunter, hired a resume coach who charged by the hour. As reported in her best selling book, Bait and Switch, the hours dragged on as the coach found more and more ways to make the resume “perfect.”

Had Ehrenreich checked the market, she would have learned that many resume consultants charge a flat fee, not an hourly rate.

(b) What value can you expect to get?

Spending a thousand dollars seems like a lot of money...but not if it’s the best way to earn two, three or even ten thousand dollars.

But throwing money at a career or business challenge won’t work either. You have to choose resources that make sense for you as an individual. I know lots of career changers who invested big bucks in education and training – only to realize the promised opportunities didn’t fit their unique profiles.

Kevin’s seminar actually was a good value because comparable seminars cost at least twice as much. And a seminar would save him months of research time as he explored new business opportunities. He would meet a dozen experienced, successful entrepreneurs – all potential mentors and role models – in one location. To get comparable value, he’d have to travel all over the country or rely on phone and email connections.

(c) What’s your time frame?

Whether you’re moving, changing careers or starting a business, you probably have a finite amount of money to spend. I recommend investing in research to discover the most effective ways to reach your goal. You may need (or want) a few paid consultations to understand your new world, so you can set meaningful priorities.

But you’re most likely to waste time and money by trying to move too fast, not by paying too much for a specific product or service.

My clients tell me they lost money by not doing their research. One client spent a significant sum to have her resume “blasted” to a thousand employers. She actually was harmed by having her name associated with the distribution company.

Another client reacted to job loss by calling the moving company. “I need a change of scene,” he declared.

Six months later, he felt stranded. Someone suggested he give me a call. “I thought I’d love living here – but I hate it,” he said. “I didn’t even know what questions to ask before I came.”

Bottom Line: In the end, you’ll gain the greatest value from your purchases by doing your research and investigating all your options. “Expensive” and “cheap” tend to get redefined during a life change. And if you plan ahead, you won’t even need to raise the question.

Based on my ebook Transform Dollars to Dreams
http://www.cathygoodwin.com/moneybook.html