LIFE ZONES
All of us who manage monthly money are actually managing a salary. And since we receive our salaries every month, we may be tempted to think that we need only to worry about the month – until the next deposit into our bank accounts. Certainly, we must meet our current monthly needs, but the big picture is much bigger than the month. Indeed, it’s even bigger – make that longer – than the current year.
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Which brings us to our series title: My money, my business, my life. This suggests an altogether different attitude. I must manage my salary as if it is a business (it is), and as if it impacts my whole life (it does).
Back to the big picture. The big picture can best be shown by a “lifeline” given in the form of a three-row table/calendar. And as you can see, we are looking at 3 life zones:
Zone 1. Learning
The big picture is indeed our whole lifetime, from age zero, all the way to age death – which we assume will occur in old age. The first zone of 21 years is our learning years, shown in grey. Grey is the colour of concrete, and concrete makes a good foundation. For most of us, the grey zone is nearly over – although learning never stops. (We realise that most of our children are still in this zone.)
Zone 2. Earning
The next zone (comprising 2 x 21 years) is our 42 earning years. These are our green years, and green represents go, go, go! We earn our monthly money, and we think that everything is just grand. In a way, it is. And in a way, it isn’t. It isn’t grand if we miss the final zone of the big picture.
Zone 3. Returning
The final zone of 21 years takes us to age 83. These years I’ve called the returning years, and I’ve coloured them in red. (They are our retirement years). Why have I called them returning, apart for the easy rhyme with learning and earning? Yes, we are likely to be returning to our Maker during this time. Death is a certainty. I write this with no pessimism at all. Death is a certainty, and the good news is that we can do a lot to prepare for it.
There’s a second reason for using returning. What returns are you getting on your investment? Have you heard that question? In this zone, you will receive no salary. If you don’t want to depend only on a State pension, you need to invest in some kind of retirement fund. For 21 years you’d be living on your returns. And 21 years is half as long as your earning years! I think that’s a huge fraction indeed. Plan for it.
Jay Pillay (1953- any time soon)
Jay Pillay’s first two critical decades were spent where his first decade began – in Pietermaritzburg. After studying at ML Sultan Technikon in Durban (anyone remember that place?), he then joined the sugar industry, working in Tongaat, Durban, and Xinavane – a sugar mill village 120km north of Maputo. Oh yes – there was a brief period of unfaithfulness, when he flirted with aluminium in Richard’s Bay. Upon retirement, he and his wife Dorothy – settled in Southport.
Jay began writing about salary management (for ordinary people living on a salary) in the early 2000s. Many of his articles were published by The Ripple Effect, a Durban-based corporate newsletter. In all his writing, Jay says he attempts to emphasise the big picture in salary management: it’s not just about making it to your next payday – it’s about making it to the end of your working life. It’s not just about your working life – it’s about your retirement too. It’s not just about the cost of living – it’s about the cost of dying too. It’s not just about you as a salary manager – it’s about your dependants too.
This 16-part series is being published here for the first time. It would be invaluable for salary managers in the early years of their lives – who realize that salary management is a lifetime business. Finally, it’s not just about reading stuff on salary management – it’s about careful thought (that means time, well invested), and then taking appropriate action.
There’s a second finally. To daughter Nikki, thank you for the picture.
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