An initial meeting with an investment advisor typically begins with a series of questions designed to find out what level of risk you are willing to accept.  Along those lines, consider the following investment scenarios:

A) You invested $50K in college tuition and after three years have received no visibility to how you have performed—no report card, no grades, no professor comments, nothing.  Are you willing to write a check for the fourth year and commit to another $50K for graduate school?

B) Over a five year period you invested $50K in a retirement plan that never provided visibility to its financial performance—no quarterly reports, no growth charts, no portfolio tables, nothing. How willing are you to continue giving them a portion of your paycheck?  Are you in for another $50K?

C) You invested $50K in a new business venture that never reported back to you its revenues or expenses—no cash flow statements, no profit-loss analysis, nothing. Are you interested in investing another $50K in this company?

Odds are none of these investment scenarios are attractive or appealing to you. Understandably, there is an unwillingness to invest in anything that lacks accountability or fails to provide visibility to its performance.

And this seems perfectly reasonable.  We shouldn’t assume simply attending classes will lead to graduation; and we shouldn’t assume blindly contributing to a 401k will yield enough money for retirement; and we shouldn’t assume a business is profitable simply because it keeps its doors open. To fully leverage an investment, we need visibility to its performance so we can continually evaluate its return.  And if that isn’t possible, we should be hesitant to invest more. Right?

So what about you? How much have you invested in yourself over the last few years? Let’s assume you’re working full-time and require another twelve hours each day for sleeping, eating and general health needs. That leaves you with roughly 2,300 discretionary hours each year to invest however you desire. Given the U.S. Census Bureau estimates median annual earnings for men working full-time in 2008 was $46K+, or roughly $22 per hour, means each year you have an opportunity to invest roughly $50K in yourself.

So how is that investment performing? Is it paying dividends? How do you know?

If you don’t, are you assuming showing up, blindly contributing and keeping your doors open will eventually provide you with a solid return? And if you weren’t willing to accept that level of risk in any of the scenarios above, what is different when it comes to your time?

I am no longer comfortable with such an investment strategy. I realize my time is limited, so I must invest wisely.