BigMoney Jobs(high school student wants to be rich some day)

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BigMoney Jobs(high school student wants to be rich some day)

Postby Gauss44 » Wed Apr 24, 2013 2:24 pm

In your opinion, for a high school senior who's choosing a career path, which of the following requires the 1st most, the 2nd most, and the 3rd most:

1. Training or education
2. Luck or abnormally high IQ
3. Overall likelihood of getting rich

A doctor, lawyer, investment banker, or something else (real estate, investing well, being thrifty, etc.)?

Feel free to discuss specific specialties or practice areas in your response.

Background: A bunch of us have been debating this lately, so I want to know what you think. Career counselor isn't helpful. Student has an A average and is a high school senior. He's well-rounded and kind of likes all school subjects equally.

(This is my very 1st post to Bogleheads. I originally posted this on Fat Wallet, and a bunch of people on that forum referred me to this forum. FW members asked about personality tests: He already took myer briggs and we would like to keep those results private. On another personality test, he got top scores in analytical and influential categories. He's leaning toward investment banking, so any 1st or 2nd hand information about getting into that or what that's like would especially be appreciated.) Thanks in advance.

Edit: ENTJ; analytical and influential
Last edited by Gauss44 on Tue Apr 30, 2013 5:04 pm, edited 1 time in total.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby NYBoglehead » Wed Apr 24, 2013 6:04 pm

For starters, have him to his best to stay of debt (to include student loans). If loans are necessary to pay for school, try to get rid of them as fast as possible as debt is the biggest drag on people accumulating wealth. Next, since he's in high school and already thinking about money, he should contribute to a Roth IRA and work while attending college in order to contribute annually to the Roth.

While there is nothing wrong with making money, I'd ask him why he wants to be an investment banker. If the thought of brokering deals and evaluating M&A, etc gets him excited then it very well might be a good fit. But if the money alone is the sole motivation, he might find it to be disappointing.

The fact is that there are a lot of jobs that have salaries high enough to make you "rich" if you save and invest. Engineers and actuaries come to mind. You could also make a very good living in law enforcement, Lieutenants and Captains in large metro areas make six figures + OT and retire with pensions.

Point is, your student should evaluate what he is interested in and try to decide on a path to pursue from there. While money is important, it shouldn't be the sole driver of career decisions.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby Rick Ferri » Wed Apr 24, 2013 6:15 pm

1) Training or education? It's a little of both - but that's not it.
2) Luck or abnormally high IQ? It's a little of both - but that's not it.

You make your own opportunities in this world. It's not something that's taught in a classroom or on the job. Luck plays a part, but you have to be smart enough to understand when luck comes banging on you door. When you see something that could be done better, just do it. Do what most people wouldn't do. Be willing to work harder than anyone else for a purpose. That's what will make you rich.

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Re: BigMoney Jobs(high school student wants to be rich some

Postby ziszew » Wed Apr 24, 2013 6:32 pm

What Rick said...

Or, to put it succinctly, do something that makes you want to get out of bed in the morning.

I come from a large family and have siblings/cousins in each of those fields.

What Rick said...

...and go to the school library and check out The Millionaire Next Door.

In my experience, people who choose a career to "get rich" rarely do, while those that follow their passion and work hard are more likely to.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby bottlecap » Wed Apr 24, 2013 6:42 pm

Rick Ferri wrote:You make your own opportunities in this world. It's not something that's taught in a classroom or on the job. Luck plays a part, but you have to be smart enough to understand when luck comes banging on you door. When you see something that could be done better, just do it. Do what most people wouldn't do. Be willing to work harder than anyone else for a purpose. That's what will make you rich.

Rick Ferri


This about sums it up. I wish I'd been told this in high school.

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Re: BigMoney Jobs(high school student wants to be rich some

Postby Gauss44 » Wed Apr 24, 2013 6:48 pm

Once he narrows down some career options, he might go shadow or intern to see if he likes it. For now, his main interests are money and sports. (He's been investing in a Roth IRA since age 16.)
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Re: BigMoney Jobs(high school student wants to be rich some

Postby Jfet » Wed Apr 24, 2013 6:51 pm

All the previous responses are true and you should listen to them, but if you want a real world answer of probably the most bang for the buck career that will get you a future so bright you have to wear shades..... software engineering, and be good at it. 4 years, don't bother with master's degree. School choice matters somewhat, but there are some excellent state schools too.

there are not many degrees where you can study for 4 years then start a job making 90K+ a year...software engineering is one of the few.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby ziszew » Wed Apr 24, 2013 7:13 pm

Gauss44 wrote:Once he narrows down some career options, he might go shadow or intern to see if he likes it. For now, his main interests are money and sports. (He's been investing in a Roth IRA since age 16.)


His interests line up with about 98% of every adolescent male (tongue planted firmly in cheek).

There is no magic bullet. The best advice is to do what you want to do; chasing a paycheck is rarely sustainable.

"Sports" and "money" are exceedingly broad. Both of those career paths have a very high attrition rate (and your friend will very quickly find out that he was a big fish in a fairly small pond...)
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Re: BigMoney Jobs(high school student wants to be rich some

Postby lostInFinance » Wed Apr 24, 2013 7:16 pm

A lot depends on your definition of rich. If you want to be Zuckerberg rich, you basically need to be an entrepreneur and start your own company. If you just want to be in the top 1% of earners, then doctors and lawyers are the two most common professions in that income bracket. My personal opinion is that most anyone in the top 5% IQ wise, basic social skills, and ability/willingness to spend x years in law/med school, can probably make it as a doctor or lawyer. I think being a successful entrepreneur is luck more than anything else.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby Jfet » Wed Apr 24, 2013 7:19 pm

ziszew wrote:
Gauss44 wrote:Once he narrows down some career options, he might go shadow or intern to see if he likes it. For now, his main interests are money and sports. (He's been investing in a Roth IRA since age 16.)


His interests line up with about 98% of every adolescent male (tongue planted firmly in cheek).

There is no magic bullet. The best advice is to do what you want to do; chasing a paycheck is rarely sustainable.

"Sports" and "money" are exceedingly broad. Both of those career paths have a very high attrition rate (and your friend will very quickly find out that he was a big fish in a fairly small pond...)


I would agree with you about sports and the small chance you have of making big money in it.

I would disagree that the best advice is to do what you want to do. One of the reasons our society has such a huge student loan problem is too many people took that advice and spent $100,000 on a degree in Egyptology, only to find out that even though they really liked their field, the number of available jobs is somewhat limited.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby DiscoBunny1979 » Wed Apr 24, 2013 7:21 pm

Jfet wrote:All the previous responses are true and you should listen to them, but if you want a real world answer of probably the most bang for the buck career that will get you a future so bright you have to wear shades..... software engineering, and be good at it. 4 years, don't bother with master's degree. School choice matters somewhat, but there are some excellent state schools too.

there are not many degrees where you can study for 4 years then start a job making 90K+ a year...software engineering is one of the few.


---------

While there are some jobs like software engineering that can start with a high salary, one has to know where those jobs will be. For instance, will the jobs be in overly priced bay area whereas an average ugly house costs $600,000 to $1,000,000?

I don't think the OP should be relying so much on salary. The OP should consider the factors of how far the money earned will go in the area the OP will live. For instance if you can be a software engineer in Texas, making $90K a year and living in a new house costing $300,000 - it would most likely be a better choice than being a software engineer in California, making $90K a year and living in a 40 year old house costing $800,000. Unless of course, you don't want to live in Texas. The point is how much money will there be after expenses?

Given that, I think that nursing, being a nurse like in an emergency room probably pays a decent rate just about anywhere.....have you checked the fees for an anesthesiologist?

In my opinion, getting Rich is not just about the money in your pocket - it's about doing something that makes you happy and in return other people benefit. That's what being wealthy is all about in my opinion . . . doing something you enjoy and getting paid for it.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby Jfet » Wed Apr 24, 2013 7:27 pm

DiscoBunny1979: very true. It is important to consider location when considering income. I often think that our tax system is a bit unfair because it does not take into account location when phasing out certain deductions, like tuition. I would rather make $120K in Alabama than $180K on the west coast...I could live like a king in Alabama for that income and I would get most deductions and not have to back door my Roth.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby Default User BR » Wed Apr 24, 2013 8:48 pm

Jfet wrote:All the previous responses are true and you should listen to them, but if you want a real world answer of probably the most bang for the buck career that will get you a future so bright you have to wear shades..... software engineering, and be good at it. 4 years, don't bother with master's degree. School choice matters somewhat, but there are some excellent state schools too.

there are not many degrees where you can study for 4 years then start a job making 90K+ a year...software engineering is one of the few.

There might be a few places in the country where a new hire starts at that level, but most places are going to be a lot less.


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Re: BigMoney Jobs(high school student wants to be rich some

Postby ziszew » Wed Apr 24, 2013 9:04 pm

Jfet wrote:<<snip>>

I would disagree that the best advice is to do what you want to do. One of the reasons our society has such a huge student loan problem is too many people took that advice and spent $100,000 on a degree in Egyptology, only to find out that even though they really liked their field, the number of available jobs is somewhat limited.


I'll counter that with a family member who went to law school, hated the work, and is now a high school teacher. Money not well spent either (and he has the loans to prove it).

I'm not suggesting the OP's friend take out 250k in loans to get a degree in underwater basketweaving, but rather chasing a paycheck rarely pays in the long run unless you actually find some enjoyment in the work itself. If you read the book I mentioned, many of the millionaires involve self-employed persons in the trades or "small" business. I'd encourage any child of mine to seek a solid career in one if that is what they wanted to do.

"Getting rich" isn't a goal, it's an outcome.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby nimo956 » Wed Apr 24, 2013 9:06 pm

It's very competitive to break into investment banking, private equity, hedge funds, consulting, etc. If you want the route that will most likely lead to landing a job in this field, then you should go to a top college for undergrad, either an Ivy or Stanford or MIT. Major in Econ, Math, Physics, or some kind of engineering. Maintain at least a 3.7 GPA. Join some kind of extra-curricular activity related to finance and use it to land a summer internship your junior year at a big name firm (Goldman Sachs, JP Morgan, etc.). You need the internship to get the interviews at your school's career fair the following fall.

Realize that while everyone wants to be able to provide for and support their family, doing something just to accumulate a ton of money is not a "remedy for a great society" as John Bogle recently said in his Frontline interview. You will trade all of your time for the big starting salary right out of school. Expect to work 80-100 hrs a week Sunday-Saturday. You will have very little time to socialize with friends outside of work. Most people burnout after 2 years. Only you can decide if the salary is worth it.

Edit: Also, make sure you know how you'll be spending the bulk of your time in these positions. My understanding is that it's not very strategic or creative. You mostly just edit pitch books all day.

Edit 2: After you burn out in 2 years, you take a "vacation" by getting your MBA at either: Harvard, Stanford, Penn, MIT, UChicago, or Northwestern.

Edit 3: Also realize that investment banking is an "up or out" culture. Meaning that every few years you either get promoted to the next level or get fired. These are all sales jobs in the end. The only way to be successful at these firms is to continually be the best at bringing in clients to generate money for your firm.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby ieee488 » Wed Apr 24, 2013 9:54 pm

a forgotten "skill" is People IQ.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby shaboob » Wed Apr 24, 2013 10:04 pm

I vote for engineering. I'm an engineer so I'm biased. From personal experience, here are some big advantages:

- industry scholarships
- internships and co-ops that pay $15-$20 an hour
- good paying on campus jobs
- many companies will pay for your masters (engineering) or an MBA
- doubled my salary in 7 years out of college
- PE licenses
- corporate travel to cool places

Summing it up, the pay is great, and you can get a free masters degree very easily. The result is that at 31 years old, I make and have way more than almost all of my friends and did it with way less debt.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby fishnskiguy » Wed Apr 24, 2013 10:12 pm

Although I'm very happy with my career choice and where it took us to where we are now, if I was seventeen today, I would go into petroleum engineering in a heartbeat. Lots of travel, some outdoor work, and in time, the chance to start your own company and make big, big, bucks.

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Re: BigMoney Jobs(high school student wants to be rich some

Postby shaboob » Wed Apr 24, 2013 10:23 pm

edited
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Re: BigMoney Jobs(high school student wants to be rich some

Postby abuss368 » Wed Apr 24, 2013 10:24 pm

Rick Ferri wrote:1) Training or education? It's a little of both - but that's not it.
2) Luck or abnormally high IQ? It's a little of both - but that's not it.

You make your own opportunities in this world. It's not something that's taught in a classroom or on the job. Luck plays a part, but you have to be smart enough to understand when luck comes banging on you door. When you see something that could be done better, just do it. Do what most people wouldn't do. Be willing to work harder than anyone else for a purpose. That's what will make you rich.

Rick Ferri



Thank you Rick for the excellent advice.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby dewey » Wed Apr 24, 2013 10:30 pm

ziszew wrote:What Rick said...

Or, to put it succinctly, do something that makes you want to get out of bed in the morning.

I come from a large family and have siblings/cousins in each of those fields.

What Rick said...

...and go to the school library and check out The Millionaire Next Door.

In my experience, people who choose a career to "get rich" rarely do, while those that follow their passion and work hard are more likely to.


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Re: BigMoney Jobs(high school student wants to be rich some

Postby gkaplan » Wed Apr 24, 2013 10:46 pm

Plastics, young man. Plastics.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby ziszew » Thu Apr 25, 2013 12:02 am

gkaplan wrote:Plastics, young man. Plastics.


I had to look it up. Hilarious
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Re: BigMoney Jobs(high school student wants to be rich some

Postby Barefootgirl » Thu Apr 25, 2013 9:59 am

My first piece of advice would be - don't grow up, it's a trap.

All joking aside, add my voice to the chorus advising one not to pursue a career based strictly on income. That said, if investment banking might be the passion, go for it and yet the same could be said for a career as an elementary school teacher or small business owner.

As someone who has watched the cost of an advanced education skyrocket, no matter what one chooses, one should consider performing a cost/benefit analysis. It appears in many cases, we no longer attend university to broaden the mind, but now rather as an admission ticket - and cost of admission appears quite high in my opinion.

Consider non traditional paths. Ignore the outside voices regarding the color of your collar, stay close to the ground, observe, listen. Jump in the car and drive around to local businesses, ask the owners what their biggest challenges are, what their greatest success comes from, what they would do differently the next time.

It might be worthwhile to sit in on a dinner of business owners, particularly self made people who might have been born in other countries.

It is very wise to ask these questions and I wish the best for our youth today....we will need them! :) BFG
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Re: BigMoney Jobs(high school student wants to be rich some

Postby feh » Thu Apr 25, 2013 1:48 pm

Jfet wrote:All the previous responses are true and you should listen to them, but if you want a real world answer of probably the most bang for the buck career that will get you a future so bright you have to wear shades..... software engineering, and be good at it.


I've been writing software for 25 years now, ever since I obtained my BS. My career has provided good income, and coupled with boglehead frugality, should have me retiring early.

But, math and science were/are my passions. I agree with others that following a career path just for the potential salary is a bad idea.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby otbricki » Thu Apr 25, 2013 1:53 pm

One thing not mentioned here is entrepreneurship. It's a great adventure and success at it can lead to wealth, perhaps more so than any other undertaking.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby lightheir » Thu Apr 25, 2013 1:54 pm

I'll echo the importance of not chasing income when finding a job, but that usually does work itself out on its own in college and after.

I will chime in from direct observation of my friends/peers, from ivy league college and postgrads what has seemed to played out in general:

- Investment banking is tops for pay. Work like a dog, uber-hard to get a plum job, but the pay is very high, especially a few years out. It's harder than it sounds.

- Anything else in hi-level finance is next highest paying. Whether it be private equity, real estate, or consulting, pay has been very high, higher than that of doctors and lawyers. Almost equally hard to get a spot as investment banking - these jobs are usually available mostly to those with connections from business school or a very strong academic record. They usually aren't going to Mr. Joe Average from the local state university.

- Doctors and lawyers do well, but are definitely well below the finance guys. It's a long and hard road though - with massively delayed gratification that almost completely nullifies the (decreasing) income that you finally achieve.

- Megamillionaires like Zuckerberg and other star achievers are extraordinarily rare. So rare that you should consider your odds of hitting it on a smaller scale similar to your odds of achieving professional athlete status. I would absolutely NOT use those guys like JObs, Zuckerbergs, Gates, as examples that your kids should emulate. That would actually be a formula for financial disaster in most cases, as all of them, including the vaunted Steve Jobs, benefited hugely from being at the right place at the right time and having a good dose of luck to boot at the most critical ventures in their lives. (It would be very easy to argue that had Jobs been born a mere 5 years earlier, he would not have had his early successes in computing, and could have very well ended up just a college dropout if he kept his ways about not fitting into systems.)
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Re: BigMoney Jobs(high school student wants to be rich some

Postby Grt2bOutdoors » Thu Apr 25, 2013 2:16 pm

1. Education - become a mathematical genius, then either develop an algorithm that correctly predicts the winning lottery numbers or work for a hedge fund that charges 2 n 20 for a few years, before setting up your own shop.
2. Education - actuary. Great salary, great quality of life - super hard to become one though.
3. Chemical engineering or petroleum engineering - go work for one of the larger intergrated players, rise to the mid/top managerial levels or put in 30 years and retire with a nice plum. Although when oil was in the low teens, oil was not the place to be.
4. Avoid commerical banking - too much regulation now, more coming, too many Joe averages - you want to land in a place where there are smart if not smarter individuals and make your mark there. Joe average will not compensate you for your brains or hard work, avoid places like that. Use glassdoor.com or the vault.com to see what others are saying about the company atmosphere and compensation. At the end of the day, unless you are calling the shots or running your own shop/department - you want to be rewarded, not just be paid average if you are far above it.
5. Either start or work at a truly innovative company - "me too" companies are not where you want to be. That means places like start-ups, biotechs, genetic engineering or pharma development based on biologics/dna markers. Super hard to get into, need like phd's and other degrees.
6. Last resort if education is not your gig - get a job in the Bakken shale, although you may have difficulty in finding a place to sleep and eat.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby marbat » Thu Apr 25, 2013 2:18 pm

lightheir wrote:I'll echo the importance of not chasing income when finding a job, but that usually does work itself out on its own in college and after.

I will chime in from direct observation of my friends/peers, from ivy league college and postgrads what has seemed to played out in general:

- Investment banking is tops for pay. Work like a dog, uber-hard to get a plum job, but the pay is very high, especially a few years out. It's harder than it sounds.

- Anything else in hi-level finance is next highest paying. Whether it be private equity, real estate, or consulting, pay has been very high, higher than that of doctors and lawyers. Almost equally hard to get a spot as investment banking - these jobs are usually available mostly to those with connections from business school or a very strong academic record. They usually aren't going to Mr. Joe Average from the local state university.

- Doctors and lawyers do well, but are definitely well below the finance guys. It's a long and hard road though - with massively delayed gratification that almost completely nullifies the (decreasing) income that you finally achieve.

- Megamillionaires like Zuckerberg and other star achievers are extraordinarily rare. So rare that you should consider your odds of hitting it on a smaller scale similar to your odds of achieving professional athlete status. I would absolutely NOT use those guys like JObs, Zuckerbergs, Gates, as examples that your kids should emulate. That would actually be a formula for financial disaster in most cases, as all of them, including the vaunted Steve Jobs, benefited hugely from being at the right place at the right time and having a good dose of luck to boot at the most critical ventures in their lives. (It would be very easy to argue that had Jobs been born a mere 5 years earlier, he would not have had his early successes in computing, and could have very well ended up just a college dropout if he kept his ways about not fitting into systems.)


Echoing almost everything that's in this post, except that investment banking (sell-side) is not necessarily the best paying finance specialty. It's a common jump-off point for buy-side jobs (private equity and hedge funds) which tend to pay more. Separately, trading tends to get you a bit more money than banking if you are "successful" at it, but it doesn't convert as well into other areas of finance.

In terms of income opportunity:
entrepreneurship > finance > doctors/lawyers > engineers

In terms of likelihood of reaching high income once you are in the field:
finance > doctors/lawyers > engineers > entrepreneurship

In terms of ease of entry to the field:
entrepreneurship > engineers > doctors/lawyers > finance

In terms of stability/comfort:
engineers > doctors/lawyers > entrepreneurship > finance

Source: I have an engineering background, was accepted to med school and declined, and now work in finance (although it's one of the areas that isn't paid quite as well as investment banking :P).
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Re: BigMoney Jobs(high school student wants to be rich some

Postby flossy21 » Thu Apr 25, 2013 2:34 pm

Here's an article that recommends Petroleum Engineering.

http://money.cnn.com/2013/04/25/news/ec ... ?iid=HP_LN
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Re: BigMoney Jobs(high school student wants to be rich some

Postby marbat » Thu Apr 25, 2013 2:41 pm

flossy21 wrote:Here's an article that recommends Petroleum Engineering.

http://money.cnn.com/2013/04/25/news/ec ... ?iid=HP_LN


Just to respond to generically to a lot of these kinds of articles that recommend engineering:

Engineering gives you a decent starting salary, stability, and work life balance. It will likely make you upper middle class, but it won't make you rich. The starting all-in pay for investment banking is typically higher than the all-in pay for any kind of engineering (~$120K), and it also scales much, much higher (the main disadvantage for engineering - pay growth over time). After two-three years of banking, it's possible to leave for a $300-350K all-in private equity job. The petroleum engineer will be lucky if he's up to $150K in that same time period.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby bungalow10 » Thu Apr 25, 2013 2:45 pm

Have him find his passion and then add a few extra math and stats classes to it so he can develop problem solving skills. Good analytical skills are always in demand.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby KyleAAA » Thu Apr 25, 2013 2:48 pm

flossy21 wrote:Here's an article that recommends Petroleum Engineering.

http://money.cnn.com/2013/04/25/news/ec ... ?iid=HP_LN


I would be careful chasing "best starting salary" lists. Engineers tend to start out with good salaries but quickly plateau (usually within 7 or 8 years) unless you move into management. It doesn't suck to be making $90-110k for the rest of your life, but you aren't going to get very rich either. You might accumulate and inflation-adjusted $3-4 million over a 40 year career using Boglehead principals. Not bad, but not filthy rich, either.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby Phineas J. Whoopee » Thu Apr 25, 2013 3:11 pm

KyleAAA wrote:
flossy21 wrote:Here's an article that recommends Petroleum Engineering.

http://money.cnn.com/2013/04/25/news/ec ... ?iid=HP_LN


I would be careful chasing "best starting salary" lists. Engineers tend to start out with good salaries but quickly plateau (usually within 7 or 8 years) unless you move into management. It doesn't suck to be making $90-110k for the rest of your life, but you aren't going to get very rich either. You might accumulate and inflation-adjusted $3-4 million over a 40 year career using Boglehead principals. Not bad, but not filthy rich, either.

I'll make a general comment in a minute but I want to respond to this point in particular.

Starting salaries are great. Ongoing salaries, royalties, commissions, capital gains, dividends, interest, and so forth are greater. Be sure whatever it is can keep your attention well enough that you will, not can, will keep up with, and preferably ahead of, new graduates.

I remember seeing a dean of a graduate engineering school giving a commencement address saying that 20 - 25 years out from your master's you should be VP of Engineering. There were a lot of people in that room. Not everybody will get to be VP of Engineering. What then? What then especially if technology fundamentally changes and it's too late to start again from entry level? What then if your high starting salary led to a high present salary and new grads get a lot less than that and are better at the new stuff than you are?

Risk is unavoidable.

PJW
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Re: BigMoney Jobs(high school student wants to be rich some

Postby Jfet » Thu Apr 25, 2013 3:25 pm

KyleAAA wrote:
flossy21 wrote:Here's an article that recommends Petroleum Engineering.

http://money.cnn.com/2013/04/25/news/ec ... ?iid=HP_LN


I would be careful chasing "best starting salary" lists. Engineers tend to start out with good salaries but quickly plateau (usually within 7 or 8 years) unless you move into management. It doesn't suck to be making $90-110k for the rest of your life, but you aren't going to get very rich either. You might accumulate and inflation-adjusted $3-4 million over a 40 year career using Boglehead principals. Not bad, but not filthy rich, either.


maybe electrical and mechanical engineers plateau at that level, but software engineers go on to make $200K+ if they are good, and they don't even have to be in charge of a team.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby Phineas J. Whoopee » Thu Apr 25, 2013 3:28 pm

Gauss44 wrote:In your opinion, for a high school senior who's choosing a career path, which of the following requires the 1st most, the 2nd most, and the 3rd most:

1. Training or education
2. Luck or abnormally high IQ
3. Overall likelihood of getting rich

A doctor, lawyer, investment banker, or something else (real estate, investing well, being thrifty, etc.)?

Feel free to discuss specific specialties or practice areas in your response.

Background: A bunch of us have been debating this lately, so I want to know what you think. Career counselor isn't helpful. Student has an A average and is a high school senior. He's well-rounded and kind of likes all school subjects equally.
...

Hi Gauss44,

Welcome to the forum!

I don't believe the question has an answer which can be given. There's a lot of great advice in this thread, but I think you're asking which career path will make a person rich some day.

Nobody knows the future.

Does your friend want to be rich some day just as he's reaching old age so he can retire? Does he want to be rich some day not too long after entering the workforce? Does he want to have a high net worth he carefully shepherds until he can support himself on his assets alone and work becomes a choice? Does he want to lead a lavish lifestyle as soon as possible; or perhaps for as long as possible even if that means starting to lead it a little later?

Investment banking worked pretty well over the last few decades (ever since investment banks gave up on being agents and became principals), but now the people in those jobs face enormous hostility. Federal government work was steady with a nice retirement system but now is under strong political attack. Law was pretty lucrative until so many people noticed and went to law school that now there's a glut. Medicine? Is your friend's plan to become a brilliant research surgeon, create many inventions that benefit mankind, and win the Nobel prize, or is it to work as a general practitioner in an underserved poverty-stricken locale? The latter medical career can be planned. The former can't.

Bill Bernstein, a well-regarded author and sometimes poster on this forum, has pointed out that historically, economic and political systems have changed in ways beneficial to some, and deleterious to others, every few decades, and advises against trying to optimize one's future finances beyond about an 80% success rate because way up there the risk of social change exceeds financial risk.

I say again, not as an answer but as the truth, nobody knows the future.

PJW
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Re: BigMoney Jobs(high school student wants to be rich some

Postby HomerJ » Thu Apr 25, 2013 3:32 pm

marbat wrote:
flossy21 wrote:Here's an article that recommends Petroleum Engineering.

http://money.cnn.com/2013/04/25/news/ec ... ?iid=HP_LN


Just to respond to generically to a lot of these kinds of articles that recommend engineering:

Engineering gives you a decent starting salary, stability, and work life balance. It will likely make you upper middle class, but it won't make you rich. The starting all-in pay for investment banking is typically higher than the all-in pay for any kind of engineering (~$120K), and it also scales much, much higher (the main disadvantage for engineering - pay growth over time). After two-three years of banking, it's possible to leave for a $300-350K all-in private equity job. The petroleum engineer will be lucky if he's up to $150K in that same time period.


The petroleum engineer also won't have to pay for a Manhatten apartment or a pricy East Coast house with a 60 minute commute... He'll more likely be living in the Mid-west where housing is cheap or overseas where all housing and expenses are paid for by the company. He also won't have to pay back large student loans from overpriced Ivy League schools. He won't have to wear fancy clothes or drive a fancy car to fit in with his co-workers. There will be very little temptation to spend lots of money to keep up with the "Jones's".

There are some financial advantages working as a plain ol' engineer.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby Clearly_Irrational » Thu Apr 25, 2013 3:32 pm

Entrepreneurship or self employment are best routes to wealth. You just can't get enough leverage or inertia working for someone else. That said, it's tough to start out that way if your parents aren't loaded so picking something that allows you to make above average wages in a field where people often start their own businesses mid-career is the next best option.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby KyleAAA » Thu Apr 25, 2013 3:57 pm

Jfet wrote:
KyleAAA wrote:
flossy21 wrote:Here's an article that recommends Petroleum Engineering.

http://money.cnn.com/2013/04/25/news/ec ... ?iid=HP_LN


I would be careful chasing "best starting salary" lists. Engineers tend to start out with good salaries but quickly plateau (usually within 7 or 8 years) unless you move into management. It doesn't suck to be making $90-110k for the rest of your life, but you aren't going to get very rich either. You might accumulate and inflation-adjusted $3-4 million over a 40 year career using Boglehead principals. Not bad, but not filthy rich, either.


maybe electrical and mechanical engineers plateau at that level, but software engineers go on to make $200K+ if they are good, and they don't even have to be in charge of a team.


Maybe in Silicon Valley, but not anywhere else I'm aware of. I'm a software engineer, btw. Team leads don't even make $100k here. That said, $100k in Atlanta compares pretty well with $200k in the valley.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby Jfet » Thu Apr 25, 2013 4:01 pm

Clearly_Irrational wrote:Entrepreneurship or self employment are best routes to wealth. You just can't get enough leverage or inertia working for someone else. That said, it's tough to start out that way if your parents aren't loaded so picking something that allows you to make above average wages in a field where people often start their own businesses mid-career is the next best option.


Actually it would be interesting to see a study on 1000 people.

500 of them try to start their own business

500 of them get a 4 year degree in engineering, go to work for someone else, and leverage their salary in the stock market (or get company stock options)

I would be curious which group would have more people who end up "rich"

I have heard that a fairly large number of entrepreneurs actually fail...
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Re: BigMoney Jobs(high school student wants to be rich some

Postby awval999 » Thu Apr 25, 2013 4:01 pm

Just because something is hot today, doesn't mean its going to be hot 5 years from now. Petroleum vs. Nuclear engineering is the perfect case. For all we know in 5 years there will be a breakthrough in a small, unusual green energy---- and the market will react immediately and offer those with experience in the niche field the big bucks--- within 5 years you'll have market saturation because all the college students will go into that field.

Point is pick something you enjoy.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby Jfet » Thu Apr 25, 2013 4:06 pm

KyleAAA wrote:
Jfet wrote:
KyleAAA wrote:
flossy21 wrote:Here's an article that recommends Petroleum Engineering.

http://money.cnn.com/2013/04/25/news/ec ... ?iid=HP_LN


I would be careful chasing "best starting salary" lists. Engineers tend to start out with good salaries but quickly plateau (usually within 7 or 8 years) unless you move into management. It doesn't suck to be making $90-110k for the rest of your life, but you aren't going to get very rich either. You might accumulate and inflation-adjusted $3-4 million over a 40 year career using Boglehead principals. Not bad, but not filthy rich, either.


maybe electrical and mechanical engineers plateau at that level, but software engineers go on to make $200K+ if they are good, and they don't even have to be in charge of a team.


Maybe in Silicon Valley, but not anywhere else I'm aware of. I'm a software engineer, btw. Team leads don't even make $100k here. That said, $100k in Atlanta compares pretty well with $200k in the valley.


In the Seattle area, you can pull 200K working at Google, Amazon, Microsoft, and probably a few other places. I don't mean 200K base, but with bonuses you can get there. I do think around 200K is a plateau and then you do have to go into management. If you can stomach management, $1,000,000+ is fairly common.

The real money of course would be a smaller startup where you get significant stock options...but that is a lot of paycheck risk too.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby lightheir » Thu Apr 25, 2013 4:26 pm

The plateau is a lot closer to $100k, actually in terms of salary.

The Silicon Valley rich programmers don't get there because of salary. They get there through stocks and stock options and getting in on ground floor. Software engineers are always being hunted for, but dont' get the crazy notion that someone will pay you $200k+ for your skills. They'll pay you that much to buy a fully fledged profitable software company that you are running, but they're not going to pay you much more than $100k, maybe mid 100s for coding.

Managers doing less coding can make more, but it's not a lot more. Again, the money is in the equity, not the salary.

And for sure, $1million is NOT common in management, even in Silicon Valley. It's downright super-rare, even in the internet heavy hitter companies.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby Clearly_Irrational » Thu Apr 25, 2013 4:32 pm

Jfet wrote:I would be curious which group would have more people who end up "rich"

I have heard that a fairly large number of entrepreneurs actually fail...


I think it would really depend on what you define as "rich". I think a frugal engineer could easily end up "well off" but I think rich would be tough.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby Gauss44 » Thu Apr 25, 2013 4:44 pm

Clearly Irrational has a good point. I think my friend's son (posted with permission) means truly rich. But I also think he might need to settle for well off. For this reason, I don't want to limit anyone's response.

There might some career paths where he would have a shot at what he wants with reasonable fallback options.
Last edited by Gauss44 on Thu Apr 25, 2013 4:53 pm, edited 1 time in total.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby beachplum » Thu Apr 25, 2013 4:46 pm

My Father -in-law was a chemical engineer for GE and had a comfortable life. I know he didn't always enjoy it and was very happy to retire.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby aaasdaef » Thu Apr 25, 2013 5:02 pm

I know several engineers at a major tech company in the Valley, and a senior software engineer can indeed get close to 200K base salary (not counting annual bonus and stocks). Note that every engineer is expected to reach this level (per company policy) which simply means having high technical competence, not necessarily leading projects. Actual project leads (not talking about managers here) for sizable projects are earning even more, as do subject field experts. I believe you can look this up on glassdoor. This is a totally different world from a normal east coast software job that some people are familiar with. And I don't think that cost of living is really twice as high here.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby otbricki » Thu Apr 25, 2013 5:08 pm

Jfet wrote:Actually it would be interesting to see a study on 1000 people.

500 of them try to start their own business

500 of them get a 4 year degree in engineering, go to work for someone else, and leverage their salary in the stock market (or get company stock options)

I would be curious which group would have more people who end up "rich"

I have heard that a fairly large number of entrepreneurs actually fail...


Entrepreneurs fail a lot. Especially the first time. However the second time success rate is much higher. To have a good chance of success you need to be willing to try multiple times.

In the end it really depends how much money you need to feel rich, and how fast you want to get there. I'm an engineer and have a net worth of about $2M nearing retirement. Is that rich? Does your son think that's rich? I don't know. It is comfortable though. I didn't really start to feel that way until my house was paid off and my kids were done with school. That was after about 30 years of work.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby otbricki » Thu Apr 25, 2013 5:19 pm

aaasdaef wrote:This is a totally different world from a normal east coast software job that some people are familiar with. And I don't think that cost of living is really twice as high here.


Cost of living index for Palo Alto is listed as about 180.
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Re: BigMoney Jobs(high school student wants to be rich some

Postby HornedToad » Thu Apr 25, 2013 5:21 pm

aaasdaef wrote:I know several engineers at a major tech company in the Valley, and a senior software engineer can indeed get close to 200K base salary (not counting annual bonus and stocks). Note that every engineer is expected to reach this level (per company policy) which simply means having high technical competence, not necessarily leading projects. Actual project leads (not talking about managers here) for sizable projects are earning even more, as do subject field experts. I believe you can look this up on glassdoor. This is a totally different world from a normal east coast software job that some people are familiar with. And I don't think that cost of living is really twice as high here.


This is my experience as well. Not just Software engineers but Programmer Analysts, Business Analysts, Tech Leads, IS Project Managers, etc. that all fall on the IS side of a company can easily be in the 100-150k+ in salary with bonus/stock options/equity taking them much higher. This is more for ~5-15 years into the career though, not starting salary. This would be for Bay Area or major companies within in California/Washington.

I'd put engineer easily above lawyer. It also has a good path to true riches and not just well off with small start-up costs for a side company or entrepreneurial route with software as a service, mobile, etc.

That said, the majority of engineers will just be well off. But that's true for the majority of all people
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