WHEN ASKED by Kiplinger about financial planning for individuals, President Obama recently said, “Spend on things that are going to increase your productivity and your income over the long term.” I agree with this sentiment. I get excited about purchasing items and services that can multiply the amount I’ll earn over the course of my career. It’s money well spent. Abundance Bound is built on the philosophy that knowledge increases your wealth.
I mention this quote because in the mail I recently received a workshop flier. It was the third piece that week. If I went to every great-sounding workshop, I’d never work. Auditions and client needs would be out the window. I’d spend all my time in class.
So I thought about the President’s financial advice and wondered, “Where is the crossover point that education no longer matters?” Sure, I can always use another workshop which increases my skills, but as a person with limited time, when is the quest for additional information trumped by using the skills I’ve already acquired?
From a purely financial perspective, there is a simple equation you can use to answer this question. If your goal is to earn more, you’ll solve the problem by asking a simple question:
How long after the workshop will I have to work to see a return justifying the cost?
There are only two factors at work here. First, you need to calculate the value of the workshop. It should be easy to determine whether a class will help you earn more money. You should intimately know your skill set and be able to determine which seminars will broaden your ability to create income. I use the words “should know,” because I always seem to meet a person in a workshop who is clearly already a master of the subject matter. Sometimes we attend a workshop because psychologically it makes us feel good. Although it’s good to feel masterful, it’s generally advisable to avoid workshops that won’t broaden your repertoire.
The second factor is, of course, money. How much does the seminar cost? That number is easily obtainable and from there, it’ll be easy to either justify the time spent or take a pass on the opportunity.
There are ways to make it worthwhile to attend more workshops. What if you could increase the value and lower the price of the seminar?
Obtaining more value isn’t difficult. Develop a study group with other participants and share knowledge. Listen to podcasts or read books on the same material to cement your learning. Use the subject matter immediately to internalize newly-acquired habits.
It’s also easy–but less well known–to lower the cost of some workshops and continued education. Here are a few. Because they’re not as familiar to many people, I’ve bullet-pointed them for you:
- Write off the training. The IRS allows business owners to deduct training that is a part of your job and not covered by an employer. Not only may you deduct the actual fees, but also ancillary costs, such as mileage, lodging and food.
- Find grants. Many workshop programs offer funds to qualified individuals who don’t have the financial resources to afford a class. Ask the firm giving the workshop about these; often they’ll have leads. If you’re a member of a related organization, ask if they give discounts to members attending training.
- Save effectively. If you can’t take the training now but need to build funds, save efficiently. A 529 plan is often referred to as a college savings plan, but invested funds may be used for any accredited higher learning institution. Make sure the training is offered by an accredited firm and you could save the money to attend your classes tax free.
- Explore tax credits. If your classes are offered as part of an undergraduate degree curriculum, you may be eligible for the American Opportunity Credit. This credit covers $2,500 of the first $4,000 of qualifying undergraduate expenses. If your class isn’t part of a formal degree program, you still may be eligible for the Lifetime Learning Credit, which is available to a wide range of students. The IRS recommends you ask the institution providing education if your workshop would qualify for these credits.
By increasing the value and lowing the cost of a workshop, it makes the time spent honing your craft easier to stomach. Instead of skipping an important seminar, you could pick up the skills to both increase your productivity and income in the future.