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Austere Couture

Garishness may finally be going out of style. The bling phenomenon of recent years always struck me as blatantly insulting. For one thing, it represents misplaced priorities, particularly for an entrepreneur. If you can afford flashy cars, jewelry and clothes, you can afford to invest more into the long-term viability of your company and your coworkers. Young fashionistas driving leased BMWs should think about what means more to their future – an awesome borrowed car or a growing bank account?

Whether or not people can actually afford flashy clothes and accessories, or are merely pretending to be wealthier than they really are, conspicuous consumption seems like a slap in the face to the less fortunate. But just as the lava from the Earth’s core periodically rises up and kicks tail on the planet’s thin crust, the history of class warfare is the history of poor people rising up and kicking rich people’s ample bottoms. The heat and pressure are rising.

Our Ponzi economy brainwashes people to believe that what we own determines who we are. A lot of young people have seen through this, joining anti-consumer movements and shunning the impractical trappings of fad and fashion. I believe that people should aspire to financial independence and I don’t think there’s anything wrong with seeking comfort, but I think the next few years of economic hardship will make it very uncool to wear labels and logos on the outside.

Today, are luxury fashions status symbols or symbols of desperation? Do Louis Vuitton handbags and Rolex watches represent exquisite fashion sense or maxed-out credit cards?

Entrepreneurs get rich by not spending hard-earned money frivolously, so I’m glad the social pressure to spend unwisely is abating. The pendulum is swinging toward a different social pressure: the pressure to behave responsibly. I’m no fashion designer, but I wouldn’t be surprised if black, gray, and earth tones make a big comeback in 2009, along with the thrifty working class that built this country. How chic.

Job Security is a Myth

Some people are born entrepreneurs, some people struggle to become entrepreneurs, and – in tough economic times – many people have entrepreneurialism thrust upon them.  

People often cite security as the primary reason for choosing employment over the stresses of business ownership, but I believe their sense of security is misplaced. Job security is a myth, and always has been a myth. Businesses fail, economies falter, tastes and trends change. Jobs move to where labor is cheap. Capital goes where it can find profits. So why not take your capital – in the form of talent – where it profits you most

According to a study by the Center on Aging and Work/Workplace Flexibility at Boston College “…about 20 percent of men aged 51 to 61 in 1992 were self employed, already a sizable proportion. Twelve years later, more than one third of those working were self employed – an increase of more than 50 percent.” There are many reasons for the increase, but whether they left or lost their jobs, I think a lot of older workers have seen through the job security myth.

Older workers usually have a little capital built up, but they also have the wisdom to see that the stresses of owning your own business are far superior to the stresses of working for someone else, because the benefits accrue directly to you. For example, many who move from employment to entrepreneurship find that even when they make less money, their lifestyle improves dramatically simply because they have so much more control over their day-to-day responsibilities.

As we learned from The Millionaire Next Door, entrepreneurialism and frugality are the cornerstones of personal financial security. In our current economic crisis, I have no doubt the government will do everything it can to mitigate the damage, but I don’t think the rest of us should just wait around to see what happens.

The most common comment I hear from late-blooming entrepreneurs is that they wonder why they waited so long. They believed their job with a big company provided security, but then came the downsizing or the rightsizing or the restructuring or the bankruptcy. And remember, when the company declares bankruptcy, it is the company that wins protection from creditors, not the employees. The imprisoned executives from Enron have better retirement prospects than most of their former employees.

Go rogue: start a business. Stop selling your time to indifferent strangers and start capitalizing on your talent. Sole proprietorships are easy and require little extra paperwork, making it easy to dip your toes into entrepreneurial waters while you are still employed. There is no such thing as job security, so as long as you’re taking chances, why not take a chance on yourself?