Train Thoughts

I was thinking about retirement and the difference between me and my brother in our careers.  He’s had a successful run at Cisco into senior management and makes a good living.  I left my job at Microsoft, where I made a fine living to start a company.

I took the risk up front of whether I could/can build a successful business that will someday fuel my retirement.  My brother focused on growing his career at Cisco.  His bet is his career will continue to progress and he’ll have long term employment until he retires.  There is of course middle ground here.

He has essentially chosen to defer his risk until his services are nolonger needed (layed off, or fired).  If he makes it to retirement at Cisco he’ll certainly have a good retirement.  If he’s let go before retirement, he’ll need to find another job.  Depending on how long it takes, he made need to dip into savings and that could push out his retirement horizon.

If my business is successful, I presume that I make enough money when we exit that my retirement is secure.  If the outcome is less than this, then I have to make a decision to start a new business or to go work for another company.  Man, that would be tough.

I chewed on this over breakfast and came to the conclusion that I don’t think either option is really more risky than the other, but it comes down to how we as individuals handle navigate risk.  I hedged risk by getting partners and raising money to help with the business.  My brother has developed skills to navigate corporate politics that reduce his risk.

If I were at Cisco without the skills to manage risk there, I would get fired and find myself eating out of the gutter.  My brother might not be equipped to start a business and find himself in the cardboard box next to me.

We all have different skill sets that help us manage risk and reward.  Some people are really good at making the right moves in a big company to remain employed and grow, others will find themselves on the short path out the door.  Either path we choose, like a good portfolio, we need to be re-balancing it as we age with more skills to reduce risk.