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Reckless Spending, Debt, and Salespeople

June 29, 2020
by
Kyle Vamvouris
A person holding a phone and some money.

Ask my wife and she will be the first to tell you, I love to spend money. I tend to juggle multiple hobbies at once and get very "into" whatever it is I am focused on. Combine a little reckless credit card spending, a car payment, and my wife's student loan and we found ourselves around $32,000 in debt. We didn't think much of our debt at first. We spent money as we always did, not worried about it. After two years we were $30,000 in debt and didn't have much in savings. I stumbled upon Dave Ramsey and he said something that woke me up "you work too hard to have nothing to show for it." That quote hit me like a truck and I went home and told my wife that we are going to get out of debt. My wife and I got very serious and after 12 months of being very frugal we found ourselves joining the 22% of Americans who are debt free. To accomplish this we had to dramatically change our habits.

When I was young in my sales career I did what a lot of salespeople do, spend my commission check before I had it. This is not uncommon behavior, salespeople spending recklessly is ingrained in our culture. It was normal for sales managers to encourage their reps to purchase expensive items likes clothes, cars, and watches. The benefit to the sales manager was their reps would have to work incredibly hard to earn more commission to keep up with their reckless spending habits. Although this might sound like a good strategy to keep performance high I would argue that it does more harm than good. In this article I am going to discuss the reasons why salespeople should avoid reckless spending and especially avoid going into debt.

Hinders your job search decision making

There is a major lever you can pull when it comes to your career, that's the decision on where you choose to work. While the company you are interviewing with is doing their due diligence you should be also. You must make sure that the company has strong leadership, a supportive culture, and an innovative product. I'm sure you can guess a major hindrance in good decision making when it comes to job hunting... Money. When you have a car payment, credit card bills, student loans, and a cell phone payment it can be very challenging to go without pay long enough to make sure you are making the best possible decision when looking for a new job. This financial pressure can cause you to accept the first job offer you get and either under negotiate or worse, not negotiate at all.

Disrupts your career trajectory

Another reason why having too much debt will hinder your decision making is it increases your desire to chase more money in the short term, and sacrifice possible long term advancement. If you are in a position where you interview candidates you see it often, the resume filled with multiple one year stints at different companies. Repeatedly making lateral moves in chase of slightly higher compensation is a recipe for career stagnation. Having a lot of debt or trying to keep up with reckless spending habits can put you in this situation by pressuring you to change employers every time you get offered a slightly higher salary. You are typically better off staying loyal to the company you are with and focusing on advancing within the organization.

Negatively impacts your integrity

It is my opinion that, in sales, integrity is the most important characteristic. Without it you will eventually fail, see my article about Billy McFarland of the Fyre Festival. If a salesperson is speaking with a prospect that inst a good fit for their product or service then they should not try and sell them. This is a very simple concept that I truly believe most salespeople grasp. The problem with having a large amount of debt and a habit of over spending is that it will force you into a position where you have to consider sacrificing your integrity. Being desperate for a large commission check can cause even an honest salesperson to bend the truth for an extra buck.

There you have it folks, my two cents on why salespeople should avoid going into debt. What are your thoughts? Do you think that salespeople are more successful when they have to keep up with their aggressive spending habits? Let me know what you think.

As always, have a wonderful day filled with success and self-improvement!

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