High Earner Careers?

[Maverick3320]

The best things in life are free - exactly. I want my children (when I have them) to have the best shot at life so they can have the freedom to choose a career that doesn't have to be long hours, and spend more time with their children. I want to give them a choice. In other words, I'm "investing" my time in their (and their children's) futures. I can't speak for everyone else here, but I "obsess" over money on this site for the exact purpose of retiring early (to spend more time with family) and to give my future family more: more time, more freedom of choices, etc.

I tend to find that those who lash out at people working hard (and harder than them) often justify their lack of hard work by assuming that those who work harder are "worse" people than they are, and have substandard goals. Sure, take life easy, take a hipster-ish "meh" mindset, and scoff at hard work. Just know that some of us actually have a plan, and it has nothing to do with the newest Iphone (which, ironically, those that are taking life easy all seem to have).

The way I see it the greatest thing money can buy is freedom and freedom to me is the ability to wake up every morning with the knowledge that you don't have to worry about a damn thing when it comes to the basics and money and that day is entirely your's to do whatever the heck you want with. It means you don't have to go to a job you don't like and be around people you don't like for the next eight to ten hours. Most of us will never know this kind of freedom but many of us can come close to this in varying degrees. I'm certainly not of the "scoff at hard work hipster mentality" but I also refuse to allow myself to be a wage slave, grovelling before some manager who couldn't give a damn if I dropped dead.

Maybe I haven't made it clear but I see a sharp distinction between people who work hard to make money so that they can have a lot of fancy, status symbol material possessions and people who work hard so that they can have financial freedom and more time with their families at some point later on. Maybe it was a bit unfair to suggest that others are obsessed with material possessions but I did say some and I encounter so many people every day in real life who fit this bill. Maybe you didn't notice but we have people that will trample each other at Walmart on Black Friday to save a few bucks on the latest vogue trinkets.

I have a plan too. That's why I'm here. I understand where you're coming from. You mentioned freedom of choices. Money does provide more than just the flashy status symbols. I get that; it's what I was alluding to at the start of this post. I just wish we weren't so deeply rooted in the mentality that the chief measure of success and happiness is money and material possessions. I am also just so tired of the crass, vulgar, celebrity worshipping, dumbed down, materialistic,
culture and the morons that I have the misfortune of having to interact with every day that take part in it.

Agreed, and I apologize for not also differentiating between working hard for material status and working hard for freedom. I also encounter many people every day who fit the materialistic bill. Shopping in a busy store - especially a Wal Mart on Black Friday - is literally one version of my personal hell.

It certainly does seem like materialism is a culture problem. You can't turn on TV these days without tripping over a lawyer/doctor drama in the big city, or whatever the newest Real Housewives or Kardashian show is. In our culture, it's not how much you make, it's how much you spend. Unfortunately, in 20-30 years when my peer group is retiring, most people are going to realize that they probably should have saved more.

[DDMP20]

Yes, but that's no reason to not make plans. I don't even have kids yet. So it makes little sense for me to work less now and "smell the roses". I work hard now to save time later, for myself and the future family. Does this mean I'm literally slaving away? Of course not - I'm just making a choice to invest now. I do see a lot of my peers (that make quite a bit less) driving nicer cars, taking frequent vacations, buying a new iPhone every year. There's really nothing wrong with that; to each his own. Of course, a very high percentage of them also seem to vote for politicians that offer to give out more "free" stuff, but that's a whole 'nother story.

I'm actually really surprised by the responses I'm receiving on this. If any group in the world would understand the value of sacrifice now to benefit later, I would think it would be Bogleheads. "Be careful about working hard now, because your plan might fail"? Wouldn't this be analogous to saying, "don't save a lot for retirement now, because you can't predict the markets"? Yes, I could die tomorrow. Theoretically, you could also lose every penny you have in the markets tomorrow. That's no reason not to invest.

You work hard now to save time later? There's nothing wrong with working hard now AND taking the time to spend with loved ones or "stop and smell the roses. What good is working so hard now that you have no time for yourself or your loved ones if five or ten years goes buy and you realize that your kids are grown up and you missed it or, if you're not a parent, you missed out on all kinds of other things you would have enjoyed?

I get what you're saying. I think all of us are on this site because we have a plan. I think the point that some of us are trying to make is that don't let that plan consume your entire life to the point where you lose out on some of the things that most people, and I'm assuming this includes you, value, such as spending time with family and friends. You probably won't drop dead of a heart attack at 45 or 50 but if you did and all you did with every second of your life is plan for retirement to the exclusion of everything else then you have to ask was it worth it?

I think it's all about balance and that's a very personal subjective decision that we must each make as individuals. For me I will never define my life by my career as many do. I define it as a father and a husband as those are far more important to me than my career. I realize that not everyone feels this way and that some may enjoy their careers so much that it is the most important aspect of their existence. But since I feel as I do it tends to color my approach to pretty much every subject when I engage in discourse with others. There are a million and one corny, trite cliches I could offer but my general mindset is that more people should stop and enjoy life now and then while they're making all of their grand plans for the future. Life is fleeting.

[DDMP20]

Agreed, and I apologize for not also differentiating between working hard for material status and working hard for freedom. I also encounter many people every day who fit the materialistic bill. Shopping in a busy store - especially a Wal Mart on Black Friday - is literally one version of my personal hell.

It certainly does seem like materialism is a culture problem. You can't turn on TV these days without tripping over a lawyer/doctor drama in the big city, or whatever the newest Real Housewives or Kardashian show is. In our culture, it's not how much you make, it's how much you spend. Unfortunately, in 20-30 years when my peer group is retiring, most people are going to realize that they probably should have saved more.

No need to apologize. I think we can both see we're each other is coming from. Being a parent of young kids and looking at the stuff that goes on in the world today and knowing that this is the world I will have to let them go to kinda scares the you know what out of me and I often feel the need to vocalize how I feel about it. But that's life I guess.

Sorry for taking this thread so far off topic.

[Rodc]

Realizing this thread has been somewhat high jacked - does anyone care to
hazard a guess on what % of software developers in the US are making
$250-$300k ? I am not talking about what google is paying, or facebook -
what is the median salary, what salary puts you in the top 25%. If
I was looking at what a profession paid I would not be asking about the
top 1% or the top 10%. And to be honest I would not be talking about
anything other than what compensation is is reasonably durable - not
sure stock options would meet that criteria over the next 10 years.

Given that full professors in CS often get over 250k, for industry positions that require a PhD that is a rough lower bound for 5+ years experience beyond the PhD. In general industry has to pay more than what a tenured academic gets for fields of CS with substantial industry demand. About 2% of Americans probably have PhDs so specialized tech workers with PhDs are likely above median. If I had to guess the median over all seniority levels, I would guess total compensation of 160-180k is median in the bay area (under the assumption that junior people dominate the statistics). A household income of 423k only puts you in the top 5% in San Francisco as of 2013 and bay area tech salaries have been going up faster than inflation since then. Assuming many households have two incomes to get to top 5%, a top 20% tech income of 210k seems reasonable.

Ok so here is my guess for specialized tech workers:
160k-180k top 50%
210k top 20%
450k top 10%
???? top 1%?

For less specialized shrink everything by 30%?

Just to emphasize again, these tech incomes can be highly variable. So in a bad year everyone might get a 25% pay cut from the vicissitudes of the stock market. A medical practice is more consistent.

As posted above, looking a glassdoor and other things, that appears to be incorrect to the point of not even being close.

Do you have any data that backs this up and refutes the information in the links up thread?

[davebo]

I would say this based upon my observation: it's a lot easier to find a high income career than it is to find a high income career where you love the job enough to put in the hours and deal with the stress associated with it and not blow up your home-life.

It's generally easy to spot which group someone's in.

Good point Mike. Maybe it's not a completely accurate statement but sometimes it seems like there are two types of people in America today. Those who value their family more than their careers and those who value their careers more than the families.

It may sound odd, this being a site primarily created for the purpose of discussing investing and money, but I often find the obsession with money and material goods displayed by some on this site to be pretentious and sometimes even obscene.

Or perhaps they value their families so much that they want the best for them, and that's why they work so hard.

The best what? The best cars? The best electronic gadgets? Clothing? The best things in life are free.

The best things in life are free - exactly. I want my children (when I have them) to have the best shot at life so they can have the freedom to choose a career that doesn't have to be long hours, and spend more time with their children. I want to give them a choice. In other words, I'm "investing" my time in their (and their children's) futures. I can't speak for everyone else here, but I "obsess" over money on this site for the exact purpose of retiring early (to spend more time with family) and to give my future family more: more time, more freedom of choices, etc.

I tend to find that those who lash out at people working hard (and harder than them) often justify their lack of hard work by assuming that those who work harder are "worse" people than they are, and have substandard goals. Sure, take life easy, take a hipster-ish "meh" mindset, and scoff at hard work. Just know that some of us actually have a plan, and it has nothing to do with the newest Iphone (which, ironically, those that are taking life easy all seem to have).

It's not that it doesn't sound like a good plan on paper, but it doesn't end up working out like you laid it out. It's not likely you will make enough money to be able to actually retire after you have kids. So if you're a hard charger, then you'll end up probably still climbing up the ladder when your kids are young and it's possible you will be BUSIEST while they are young.

My wife teaches in an affluent area and the parents there are high earners. This is a family centered community so most of the dads are involved as much as they can be, but their jobs basically keep them away from most of the activities unless they are on a weekend. They are providing their families with a lot of good things like a safe place to live, great schools, the ability for the mom to stay at home, and vacations. I guess the question is whether or not this is how you want to raise your kids.

I actually took kind of an opposite approach in some ways. I like my job, but I’m working below my potential because my kids are young (3 kids, ages 4-7). My wife and I both work close to our homes and can drop the kids off at school and pick them up afterwards. I can coach their teams, we can go to swim lessons together, we can play outside after work, make it to all their events, etc. Our entire weekends are spent doing things with our kids while they are young.

The route that I went for extra income is to build an e-commerce business about 11 years ago that I still run to this day. It generates significant income for me and can be run at times that are convenient for me.

[DDMP20]

I actually took kind of an opposite approach in some ways. I like my job, but I’m working below my potential because my kids are young (3 kids, ages 4-7). My wife and I both work close to our homes and can drop the kids off at school and pick them up afterwards. I can coach their teams, we can go to swim lessons together, we can play outside after work, make it to all their events, etc. Our entire weekends are spent doing things with our kids while they are young.

The route that I went for extra income is to build an e-commerce business about 11 years ago that I still run to this day. It generates significant income for me and can be run at times that are convenient for me.

That's the kind of life our family wants too. You mention the extra income. I always hear people talking about making more money but almost never hear people talking about how they've decided to buy less s#*t that they don't really need.

[stoptothink]

Realizing this thread has been somewhat high jacked - does anyone care to
hazard a guess on what % of software developers in the US are making
$250-$300k ? I am not talking about what google is paying, or facebook -
what is the median salary, what salary puts you in the top 25%. If
I was looking at what a profession paid I would not be asking about the
top 1% or the top 10%. And to be honest I would not be talking about
anything other than what compensation is is reasonably durable - not
sure stock options would meet that criteria over the next 10 years.

Given that full professors in CS often get over 250k, for industry positions that require a PhD that is a rough lower bound for 5+ years experience beyond the PhD. In general industry has to pay more than what a tenured academic gets for fields of CS with substantial industry demand. About 2% of Americans probably have PhDs so specialized tech workers with PhDs are likely above median. If I had to guess the median over all seniority levels, I would guess total compensation of 160-180k is median in the bay area (under the assumption that junior people dominate the statistics). A household income of 423k only puts you in the top 5% in San Francisco as of 2013 and bay area tech salaries have been going up faster than inflation since then. Assuming many households have two incomes to get to top 5%, a top 20% tech income of 210k seems reasonable.

Ok so here is my guess for specialized tech workers:
160k-180k top 50%
210k top 20%
450k top 10%
???? top 1%?

For less specialized shrink everything by 30%?

Just to emphasize again, these tech incomes can be highly variable. So in a bad year everyone might get a 25% pay cut from the vicissitudes of the stock market. A medical practice is more consistent.

I'd love to see something substantive that backs up these numbers. I think I was the first person to throw out tech in this thread, my wife is in tech, as are several of my friends, and their compensation (for their education and level of experience) isn't really comparable to any other field; still, these numbers seem WAY optimistic. The top 10% making $450k+ ?

[Clearly_Irrational]

I'd love to see something substantive that backs up these numbers. I think I was the first person to throw out tech in this thread, my wife is in tech, as are several of my friends, and their compensation (for their education and level of experience) isn't really comparable to any other field; still, these numbers seem WAY optimistic. The top 10% making $450k+ ?

I'm in Tech, how the heck do I get that job? From what I know the top people make half of that in expensive markets with terrible work/life balance. For example developers who work on flash trading who live in New York.

[Lincoln]

I got there by working for a fortune 500 company with ownership for profit & loss (p&l) of a part of our business. I came from a state school with a business undergraduate degree, got a job starting @ $30K right after college in a HCOL area. My standard of living actually went down from college to my first job in the real world (thanks mom and dad!). This made me hungry and I worked hard, stayed late and continued learning through professional certifications. I parlayed that to increasing responsibility getting promoted every 1-2 years. I've been working for 13 years and I am just now starting to settle in to where I think I'll be for awhile. To move up would mean significantly more time away from home and would require more office politics.

I think the key for me was getting involved in special projects that were important to my managers and even higher ups. This was almost like a second job for me and its paid off well. I'd do my "day job" during normal hours and then stay late or carve out other time to work on these special projects. It turned me into one of the "go-to" people and it progressed my career accordingly. So basically, it all boils down to hard work and getting yourself the opportunities early on. Not much different than investing that is espoused on this site, start early and let the compounding do the heavy lifting.

[cb990z]

Ok so here is my guess for specialized tech workers:
160k-180k top 50%
210k top 20%
450k top 10%
???? top 1%?

For less specialized shrink everything by 30%?

Just to emphasize again, these tech incomes can be highly variable. So in a bad year everyone might get a 25% pay cut from the vicissitudes of the stock market. A medical practice is more consistent.

As posted above, looking a glassdoor and other things, that appears to be incorrect to the point of not even being close.

Do you have any data that backs this up and refutes the information in the links up thread?

See my earlier post in this thread, which does provide some data.

Glassdoor and other salary sites are often inaccurate because they leave out / are completely misleading on the non-salary compensation -- much of which is cash equivalent. My post shows how Netflix H1B salary data sheds some light on the peer Tech companies' total compensation numbers because of the way they do mostly cash compared to peers.

It's like looking at Wall Street salaries and leaving out the bonus and profit sharing. You often see some managing directory with a $400k base salary making >$1M consistently year after year. So if people say "no way that's not their salary" it kind of misses the point.

The other thing that I think people are missing is the "specialized tech workers" qualifier, not just IT employees in any field. Specialized doctors make integer multiples of what GPs do.

[DVMResident]

OP, I would broaden your question. A better focus is total life time earning. Focusing solely on income/yr ignores the tuition and years of training costs of getting to that high salary. Successful people take many different approaches and we're not going to hash all the specifics in a single thread. Generally, I think there are sweet spots that optimize training:pay out. I would bucket the best sweet spots into the following "tracks":

Short-training in-demand areas, long working life: HS plus a 1~2 training programs, often with a technical focus: machinists, heavy equipment operators, electricians, etc.

e.g. I have a friend with a machinist background and good hands started working for university at 19 in a metal shop, then worked his way into the imaging group, got the university to pay for a a 4-month training as cyclotron technician and for machine line coding, now grossing ~$63k/yr with with 9 years into a pension system at age 28 (2.5% * years of services * 3 avg highest, plus SS). He'll probably be a supervisor in the next 5 years. IMO, he's is doing great and his life time earnings will nip at the heels of many highly paid professional (due in large part to the heavy ended pension formulas and his young starting age).

Mid-low: BS/BA. Engineering and CS are typically the highest paid, but accounting and HR degrees do well, too.

Mid-training: BS + 1~2 year master degrees. Engineering, CS, nursing, HR, Accounting/CPA. Masters program are short and take very little away from your working years, but can add quite an income boost for life. Depending on the field, Masters are often a sweet spot to optimize life-time earnings.

Long-training, compressed working years: MD, PhD, JD. These prolonged training periods are often not worth it from a life time earning perspective. MDs, JDs, and dentists probably being the best paid, though it varies considerably by specialty (and the JD market is rough at the moment). A hand full will make very high incomes, but suffer from long hours (expect dentists ) and head winds of high taxes of compressed working years (+/- heavy debt load). STEM PhD have the advantage of getting paid through their training years, but tend to hit lower salary caps compared to the professional terminal degrees.

[FrugalInvestor]

A lot of it is being at the right place at the right time. I know a few people in this category, and they've honestly said luck played a big part.

I believe that this is true. It's also true that one can be a high earner in nearly any field (not necessarily any job) but it typically requires being a high producer. It also requires being with an organization that recognizes and rewards high production.

[bb]

"I would guess total compensation of 160-180k is median in the bay area ..."


Ahh - am I the only one that does not consider median salary in the Bay Area the
median salary for software development - or anything else? The OP was not
about salaries in the Bay Area.

[stoptothink]

"I would guess total compensation of 160-180k is median in the bay area ..."


Ahh - am I the only one that does not consider median salary in the Bay Area the
median salary for software development - or anything else? The OP was not
about salaries in the Bay Area.

Next you are going to try tell me that the median home value in the entire country is not $1.1m...

[Rodc]

Ok so here is my guess for specialized tech workers:
160k-180k top 50%
210k top 20%
450k top 10%
???? top 1%?

For less specialized shrink everything by 30%?

Just to emphasize again, these tech incomes can be highly variable. So in a bad year everyone might get a 25% pay cut from the vicissitudes of the stock market. A medical practice is more consistent.

As posted above, looking a glassdoor and other things, that appears to be incorrect to the point of not even being close.

Do you have any data that backs this up and refutes the information in the links up thread?

See my earlier post in this thread, which does provide some data.

Glassdoor and other salary sites are often inaccurate because they leave out / are completely misleading on the non-salary compensation -- much of which is cash equivalent. My post shows how Netflix H1B salary data sheds some light on the peer Tech companies' total compensation numbers because of the way they do mostly cash compared to peers.

It's like looking at Wall Street salaries and leaving out the bonus and profit sharing. You often see some managing directory with a $400k base salary making >$1M consistently year after year. So if people say "no way that's not their salary" it kind of misses the point.

The other thing that I think people are missing is the "specialized tech workers" qualifier, not just IT employees in any field. Specialized doctors make integer multiples of what GPs do.

Thank you. I lost track of that.

I'm not sure though the data say what you think they say.

Most of those are for senior people and moreover for job classifications that appear to have one person. I think we all believe that specific senior people can make a lot of money. If all you are saying is some very specific high value special people make a lot money then we agree. But I don't see how that is particularly germane to the OP.

But if we look at the single case in your data where there is more than one person in the job category we see generic software people and an average salary of $131K, pretty well in line with the glassdoor data for generic software people.

[randomguy]

"I would guess total compensation of 160-180k is median in the bay area ..."


Ahh - am I the only one that does not consider median salary in the Bay Area the
median salary for software development - or anything else? The OP was not
about salaries in the Bay Area.

But isn't one of the ways to get a high salary is to move to a HCOL area?:) If you want to make 250k/yr and are a software developer why wouldnt you be moving to the bay area and working for a glamour name? Obviously the 2 big factors are that most people are not good enough followed pretty quickly by people choosing not to move for money.

You might think of companies like google, facebook, apple, and so on when you here the term software developer. Those are the top 10% of developers. The rest of the field is doing stuff that doesn't pay anywhere near as much. As yes there is a ton of generalization in those statements.

[cb990z]

Thank you. I lost track of that.

I'm not sure though the data say what you think they say.

Most of those are for senior people and moreover for job classifications that appear to have one person. I think we all believe that specific senior people can make a lot of money. If all you are saying is some very specific high value special people make a lot money then we agree. But I don't see how that is particularly germane to the OP.

But if we look at the single case in your data where there is more than one person in the job category we see generic software people and an average salary of $131K, pretty well in line with the glassdoor data for generic software people.

I'm not an expert at this data, but I believe the high earner job classifications all having one person is partially an artifact of the H1B process requiring jobs positions to be pitched in such a way to attempt to demonstrate there is no citizen who can do the job. Furthermore, at many Tech companies, position titles like "Senior Engineer" are typically achieved with 4-5 years of experience out of an undergrad degree or 2-3 years out of a graduate degree. *shrug* It varies, though.

To your point though... see my reply to the next poster in a similar vein:

You might think of companies like google, facebook, apple, and so on when you here the term software developer. Those are the top 10% of developers. The rest of the field is doing stuff that doesn't pay anywhere near as much. As yes there is a ton of generalization in those statements.

The frame of reference of each poster may indeed be distorting the discussion. From my POV, I work in the Bay Area: it seems pretty commonplace to get compensation in the range that many posts in this thread are claiming are exceptions or rare experts. Seems usual from where I sit. I guess if you grow up on 5th avenue you might think, "it's pretty common to have a full time chauffeur."

[William Million]

300k/year is great, but advantage of being a Boglehead is you can get rich without ever earning that salary. Working in Govt, it was not realistic for me to earn that salary.

Not that I tell anyone about it, but my net worth is a heck of a lot more impressive than my annual salary.

[TradingPlaces]

Everybody should do a Venn diagram composed of what they love doing, what they are good at doing and what pays enough to allow a decent living standard.

Sadly, as best I can tell there is no three way intersection on that diagram.

Maybe. The key is to NOT HOPE that there is intersection.

The key is to MAKE that intersection. That happens by exercising will power, hard work, and years of experience.

[IFKC]

300k/year is great, but advantage of being a Boglehead is you can get rich without ever earning that salary. Working in Govt, it was not realistic for me to earn that salary.

Not that I tell anyone about it, but my net worth is a heck of a lot more impressive than my annual salary.

Agreed. And there are other compensations beyond financial.

This thread seems to have gotten somewhat off topic, but I'll toss another variable out there: how much does it cost to get into the field/job? IE, if you're paying $2,000 a month in student loans to pull down a 300k pre-tax salary, that's not quite a 300k salary.

[2tall4economy]

Ya...the 'tons of people making 300k+' thing in tech is very overblown and bubbliciously California-centric. I am consulting for a fortune 500 firm (financial services with heavy tech use) with 10B+ in revenue and they have 7 people making over 300k total comp in IT. A couple of those are making a lot more than 300k. All are managing very large budgets (30M+) and teams.

Fortune 500 firms are full of mediocre talent.

Yes they are, but that is a meaningless statement. By definition all firms have the majority of their talent as average / mediocre.

I've set budgets for and interviewed with a number of Fortune 500 firms, and they're all very similar on compensation; basically any vp (real vp, not banking vp where it's the first promotion) or real director position all in comp, any field, based in any col area will be $300k or more. Granted it's only the top 1% in the firms ranks that will ever see that but there tend to be plenty of individuals there. In my megacorp, just my function has 155 people at the $300k+ level. Add in the other functions like hr and sales and engineering etc and you're talking about thousands of people just in my company.

[Rodc]

The frame of reference of each poster may indeed be distorting the discussion. From my POV, I work in the Bay Area: it seems pretty commonplace to get compensation in the range that many posts in this thread are claiming are exceptions or rare experts. Seems usual from where I sit. I guess if you grow up on 5th avenue you might think, "it's pretty common to have a full time chauffeur."

I struggle with that as well. In my world I know lots of people who make very good money in Tech, though many are CTO, CEO, managing directors, have their own small companies, etc. And of course I don't ask them how much they make, though I can get a hint from lifestyles.

I also know folks a rung or two down from that who I don't think make near that kind of money (though in the general scheme of things they do fine), and of course I don't ask them either. That said I do know some hot shots working free lance coding job to job who do make that high end money. That said they have neither benefits or any job security so not entirely a free lunch.

The town I live in is not restricted to the top 1%, but I think is largely top 2%-3% with a whole lot in the top 1% so I just don't know that my view is very representative. My going in assumption was closer to yours, at least as far as SV, but as I poked around it seemed my view might be slanted. So frankly it is all a bit of a mystery to me.

[2tall4economy]

The frame of reference of each poster may indeed be distorting the discussion. From my POV, I work in the Bay Area: it seems pretty commonplace to get compensation in the range that many posts in this thread are claiming are exceptions or rare experts. Seems usual from where I sit. I guess if you grow up on 5th avenue you might think, "it's pretty common to have a full time chauffeur."

I also know folks a rung or two down from that who I don't think make near that kind of money (though in the general scheme of things they do fine), and of course I don't ask them either. That said I do know some hot shots working free lance coding job to job who do make that high end money. That said they have neither benefits or any job security so not entirely a free lunch.

In Fortune 500s you're absolutely right - pay is exponential. The top dog functional C*O (anyone other than CEO) will make, say $5m/year all in for an average industry, more for banking and oil and tech, less for some others. His or her direct reports will probably be at most $1m all in and that pay bracket will probably bottom out around $500k. The next rung down from there will top out where the last ends at $500k and go down to about $250k. The remaining 99% of the company caps out below $200k and probably 90% doesn't break $100k

you can confirm this from public filings.

[Vilgan]

That said I do know some hot shots working free lance coding job to job who do make that high end money. That said they have neither benefits or any job security so not entirely a free lunch.

Other than paid time off (which is just a margin of pay), the benefits quickly become irrelevant at higher levels of income in my experience. That said, there's a lot of various skills that come into play in the contract world that aren't necessary in the W-2 world and most people I've talked to far prefer the simplicity and security of the W-2 world. For specific numbers, 150k seems pretty standard at most tech companies with top paying companies like Facebook and Google going to 170k to 200k. This is for senior but not top level jobs. In the contract world, 300k is very doable and 400k-500k is possible if you are able to command a top rate or add employees or sub contractors. Contract world also offers the ability to make a lot and then go take a 3 month vacation between contracts while most companies prefer their employees not disappear for 3 months a year.

Someone mentioned Glassdoor and one issue with using Glassdoor is that the salaries are averaged over time so they are frequently well behind current compensation. I spent a bit of time talking to a Facebook recruiter and they now pay 170k base salary for positions that still show as 130k on Glassdoor.

[westie]

In my field you'll never achieve your 300K goal. However, it is not too difficult to break well through the 100K barrier in law enforcement (after 10 years) while earning a nice pension if you are willing to work some extra duty assignments and deal with the headache of a sergeant or lieutenant's rank.

As far as this subject goes, I think it's much easier to have a couple making 100K plus each vs one person making over 300K. With a household income around 200K, one can enjoy a pretty good life in the USA while saving around 50K a year.

I agree, retired federal LEO at 55, never made more than 135K a year but have a annual govt pension of 100K+. Along with the wife's pension and Soc Sec we have approx 140K in annual income for the rest of our lives. We feel very fortunate.

[Rodc]

That said I do know some hot shots working free lance coding job to job who do make that high end money. That said they have neither benefits or any job security so not entirely a free lunch.

Other than paid time off (which is just a margin of pay), the benefits quickly become irrelevant at higher levels of income in my experience. That said, there's a lot of various skills that come into play in the contract world that aren't necessary in the W-2 world and most people I've talked to far prefer the simplicity and security of the W-2 world. For specific numbers, 150k seems pretty standard at most tech companies with top paying companies like Facebook and Google going to 170k to 200k. This is for senior but not top level jobs. In the contract world, 300k is very doable and 400k-500k is possible if you are able to command a top rate or add employees or sub contractors. Contract world also offers the ability to make a lot and then go take a 3 month vacation between contracts while most companies prefer their employees not disappear for 3 months a year.

Someone mentioned Glassdoor and one issue with using Glassdoor is that the salaries are averaged over time so they are frequently well behind current compensation. I spent a bit of time talking to a Facebook recruiter and they now pay 170k base salary for positions that still show as 130k on Glassdoor.

We have a large number of W-2 employees and contract software folks. Many make exactly the trade highlighted in blue. Some absolutely prefer one side or the other in that trade. Seems to me that most I have talked to have a clear preference.

[LiveSimple]

We have a large number of W-2 employees and contract software folks. Many make exactly the trade highlighted in blue. Some absolutely prefer one side or the other in that trade. Seems to me that most I have talked to have a clear preference.

The folks who prefer the contract route are willing to take the risk for extra money. Mostly they believe in themselves and their skills.

[Rodc]

We have a large number of W-2 employees and contract software folks. Many make exactly the trade highlighted in blue. Some absolutely prefer one side or the other in that trade. Seems to me that most I have talked to have a clear preference.

The folks who prefer the contract route are willing to take the risk for extra money. Mostly they believe in themselves and their skills.

Many also have spouses with good incomes and health insurance and such, which mitigates the risk.

[randomguy]

We have a large number of W-2 employees and contract software folks. Many make exactly the trade highlighted in blue. Some absolutely prefer one side or the other in that trade. Seems to me that most I have talked to have a clear preference.

The folks who prefer the contract route are willing to take the risk for extra money. Mostly they believe in themselves and their skills.

Many also have spouses with good incomes and health insurance and such, which mitigates the risk.

There is no risk for most of the ones I know. They have a network of people that would vouch for them and they could have a normal job in under a week. Health insurance used to be an issue pre ACA but now a days it is just a 12k expense.

[Rodc]

We have a large number of W-2 employees and contract software folks. Many make exactly the trade highlighted in blue. Some absolutely prefer one side or the other in that trade. Seems to me that most I have talked to have a clear preference.

The folks who prefer the contract route are willing to take the risk for extra money. Mostly they believe in themselves and their skills.

Many also have spouses with good incomes and health insurance and such, which mitigates the risk.

There is no risk for most of the ones I know. They have a network of people that would vouch for them and they could have a normal job in under a week. Health insurance used to be an issue pre ACA but now a days it is just a 12k expense.

From what I can see that risk was real in 2008. Beware thinking the recent past has to continue.

Indeed many of the contract software people I know, especially those over about 45, and certainly over 55, and with families at home, are only contract software folks because they got laid off in 2008 and this was their only path. Unemployment is way down now, which is great. Not all mind you - some love the contractor route and it suits them well. And I would also comment from the resumes that come across my desk there are plenty of contract software folks who are far from hot shots, and rather are folks laid off from defense contractors or whatever, really hoping for a few more pay checks before being forced into retirement by forces beyond their control.

[randomguy]

From what I can see that risk was real in 2008. Beware thinking the recent past has to continue.

Indeed many of the contract software people I know, especially those over about 45, and certainly over 55, and with families at home, are only contract software folks because they got laid off in 2008 and this was their only path. Unemployment is way down now, which is great. Not all mind you - some love the contractor route and it suits them well. And I would also comment from the resumes that come across my desk there are plenty of contract software folks who are far from hot shots, and rather are folks laid off from defense contractors or whatever, really hoping for a few more pay checks before being forced into retirement by forces beyond their control.

Those defense contractors whose resumes you are getting are not the software contractors who were making 300k+. And getting a job in 2000-2002 and 2008-9 was not a big deal for the top end people. Heck ever darn person I knew at Google/Apple/Facebook was agressively at making it clear that they were still hiring if your current gig wasn't going well. Probably for the recruiting bonus more than my dazzling personality:)

But again few people are in this boat. The 300k+ contractor isn't the normal one even in the vally. The normal one is more like 120k who goes through some body shop that skims off the top. If your in the category you are treated as a replaceable resource.

It goes back to the top in anyfield makes out well. How far up you need to be varies based on career. Want to make money in Acting/Baseball/Basketball/Football? Plan on being in the top .1%. Software? Maybe top 10%. Surgeon? Top 50%. And of course you should look what happens if you don't make it to those top %.

[Rodc]

From what I can see that risk was real in 2008. Beware thinking the recent past has to continue.

Indeed many of the contract software people I know, especially those over about 45, and certainly over 55, and with families at home, are only contract software folks because they got laid off in 2008 and this was their only path. Unemployment is way down now, which is great. Not all mind you - some love the contractor route and it suits them well. And I would also comment from the resumes that come across my desk there are plenty of contract software folks who are far from hot shots, and rather are folks laid off from defense contractors or whatever, really hoping for a few more pay checks before being forced into retirement by forces beyond their control.

Those defense contractors whose resumes you are getting are not the software contractors who were making 300k+. And getting a job in 2000-2002 and 2008-9 was not a big deal for the top end people. Heck ever darn person I knew at Google/Apple/Facebook was agressively at making it clear that they were still hiring if your current gig wasn't going well. Probably for the recruiting bonus more than my dazzling personality:)

But again few people are in this boat. The 300k+ contractor isn't the normal one even in the vally. The normal one is more like 120k who goes through some body shop that skims off the top. If your in the category you are treated as a replaceable resource.

It goes back to the top in anyfield makes out well. How far up you need to be varies based on career. Want to make money in Acting/Baseball/Basketball/Football? Plan on being in the top .1%. Software? Maybe top 10%. Surgeon? Top 50%. And of course you should look what happens if you don't make it to those top %.

See blue. Right. That is the point. There are few hot shots in software, like in any field. But it is the norm? Seems the answer is no.

So I think we are in agreement.

[swaption]

Good point Mike. Maybe it's not a completely accurate statement but sometimes it seems like there are two types of people in America today. Those who value their family more than their careers and those who value their careers more than the families.

It may sound odd, this being a site primarily created for the purpose of discussing investing and money, but I often find the obsession with money and material goods displayed by some on this site to be pretentious and sometimes even obscene.

Or perhaps they value their families so much that they want the best for them, and that's why they work so hard.

The best what? The best cars? The best electronic gadgets? Clothing? The best things in life are free.

The best things in life are free - exactly. I want my children (when I have them) to have the best shot at life so they can have the freedom to choose a career that doesn't have to be long hours, and spend more time with their children. I want to give them a choice. In other words, I'm "investing" my time in their (and their children's) futures. I can't speak for everyone else here, but I "obsess" over money on this site for the exact purpose of retiring early (to spend more time with family) and to give my future family more: more time, more freedom of choices, etc.

I tend to find that those who lash out at people working hard (and harder than them) often justify their lack of hard work by assuming that those who work harder are "worse" people than they are, and have substandard goals. Sure, take life easy, take a hipster-ish "meh" mindset, and scoff at hard work. Just know that some of us actually have a plan, and it has nothing to do with the newest Iphone (which, ironically, those that are taking life easy all seem to have).

It's not that it doesn't sound like a good plan on paper, but it doesn't end up working out like you laid it out. It's not likely you will make enough money to be able to actually retire after you have kids. So if you're a hard charger, then you'll end up probably still climbing up the ladder when your kids are young and it's possible you will be BUSIEST while they are young.

My wife teaches in an affluent area and the parents there are high earners. This is a family centered community so most of the dads are involved as much as they can be, but their jobs basically keep them away from most of the activities unless they are on a weekend. They are providing their families with a lot of good things like a safe place to live, great schools, the ability for the mom to stay at home, and vacations. I guess the question is whether or not this is how you want to raise your kids.

I actually took kind of an opposite approach in some ways. I like my job, but I’m working below my potential because my kids are young (3 kids, ages 4-7). My wife and I both work close to our homes and can drop the kids off at school and pick them up afterwards. I can coach their teams, we can go to swim lessons together, we can play outside after work, make it to all their events, etc. Our entire weekends are spent doing things with our kids while they are young.

The route that I went for extra income is to build an e-commerce business about 11 years ago that I still run to this day. It generates significant income for me and can be run at times that are convenient for me.

I supplied the bold above. Simply put, my guess is that I am essentially one of the dads you describe above. My take on this and the perspective of the poster to whom you were replying, is that much of this is no more than rationalization of our own life choices. Why bother? At the end of the day, I have come to realize this is how I am wired. I rely on my wife to essentially point me in the right direction, and I'll jump through hoops to be there when it is important. But I will also jump through hoops to engage in my own activities (i.e. sports, etc.). In my own rationalized view of the world I say do my kids really need all of my attention on them? Now as they enter high school my guess is they feel more than enough attention on them. To some extent I feel that among my greatest gifts to them is to live my own life and to give them room to live theirs. Ultimately anything they will do will depend on what is inside. This also impacts how my relationship with them evolves. But that is just me. We can all derive great joy from our kids, but in my opinion too many give them the added pressure of being the primary source of their parent's happiness.

[SouthernCPA]

So many angry people in this thread....

I've had many clients who make well north of $300k a year and they have varied backgrounds and fields. Doctors (usually specialized), some Law Partners (although law seems to be feast or famine - some attorneys are crushing it, others are making less than my teacher wife), Dentists, Orthodontists, etc. Even a lowly little CPA could make north of $300k if they rose to partner in the right firm.

Aside from the big professions (dentist, surgeons, orthodontists, etc) the way to make $300k is to utilize cheaper labor/costs below you and sell at a higher price and keep the spread. This is how Law partners, CPA partners, etc get to those income levels because they essentially are building a business that just happens to sell their professional service that they went to school to learn. The technical aspects of their education and training are great, but the real money is made in the growing of a client base and then leveraging lower paid associates to produce the work and then replicating.

One of the wealthiest clients I've ever dealt with doesn't even have a college degree and if you saw him pull up to a restaurant in his used F250 and blue jeans many educated professionals would probably not think much of him, even though he's got a blue collar business and has around $35 million in cash or cash equivalents.

I'm not saying that we all need to skip college by any means, but the point is to say that selling a service that is in demand and leveraging lower costs to provide the service are the key to big incomes. Whether you are a W2 surgeon working for a hospital group or a blue collar business guy who rents out heavy equipment, you're selling something for a higher price than you paid for it. The surgeon is selling his time and expertise to a hospital (that also must stay in business), the blue collar guy is selling his product/service directly to customers.

No matter what you do, you've got to be dedicated and ready to sacrifice a lot of time either in education or building a company.

[davebo]

Or perhaps they value their families so much that they want the best for them, and that's why they work so hard.

The best what? The best cars? The best electronic gadgets? Clothing? The best things in life are free.

The best things in life are free - exactly. I want my children (when I have them) to have the best shot at life so they can have the freedom to choose a career that doesn't have to be long hours, and spend more time with their children. I want to give them a choice. In other words, I'm "investing" my time in their (and their children's) futures. I can't speak for everyone else here, but I "obsess" over money on this site for the exact purpose of retiring early (to spend more time with family) and to give my future family more: more time, more freedom of choices, etc.

I tend to find that those who lash out at people working hard (and harder than them) often justify their lack of hard work by assuming that those who work harder are "worse" people than they are, and have substandard goals. Sure, take life easy, take a hipster-ish "meh" mindset, and scoff at hard work. Just know that some of us actually have a plan, and it has nothing to do with the newest Iphone (which, ironically, those that are taking life easy all seem to have).

It's not that it doesn't sound like a good plan on paper, but it doesn't end up working out like you laid it out. It's not likely you will make enough money to be able to actually retire after you have kids. So if you're a hard charger, then you'll end up probably still climbing up the ladder when your kids are young and it's possible you will be BUSIEST while they are young.

My wife teaches in an affluent area and the parents there are high earners. This is a family centered community so most of the dads are involved as much as they can be, but their jobs basically keep them away from most of the activities unless they are on a weekend. They are providing their families with a lot of good things like a safe place to live, great schools, the ability for the mom to stay at home, and vacations. I guess the question is whether or not this is how you want to raise your kids.

I actually took kind of an opposite approach in some ways. I like my job, but I’m working below my potential because my kids are young (3 kids, ages 4-7). My wife and I both work close to our homes and can drop the kids off at school and pick them up afterwards. I can coach their teams, we can go to swim lessons together, we can play outside after work, make it to all their events, etc. Our entire weekends are spent doing things with our kids while they are young.

The route that I went for extra income is to build an e-commerce business about 11 years ago that I still run to this day. It generates significant income for me and can be run at times that are convenient for me.

I supplied the bold above. Simply put, my guess is that I am essentially one of the dads you describe above. My take on this and the perspective of the poster to whom you were replying, is that much of this is no more than rationalization of our own life choices. Why bother? At the end of the day, I have come to realize this is how I am wired. I rely on my wife to essentially point me in the right direction, and I'll jump through hoops to be there when it is important. But I will also jump through hoops to engage in my own activities (i.e. sports, etc.). In my own rationalized view of the world I say do my kids really need all of my attention on them? Now as they enter high school my guess is they feel more than enough attention on them. To some extent I feel that among my greatest gifts to them is to live my own life and to give them room to live theirs. Ultimately anything they will do will depend on what is inside. This also impacts how my relationship with them evolves. But that is just me. We can all derive great joy from our kids, but in my opinion too many give them the added pressure of being the primary source of their parent's happiness.

Right, I don't think there is really a right/wrong. Some people would feel guilty about it, some people wouldn't think twice. The kids that come out of these households are ready to conquer the world, so there is probably something to be said for seeing their parents tackle their careers. As long as they are engaged when they are back home, I think most kids will look back fondly on their childhoods.

My approach is not without some guilt either. In this case, my wife feels a little guilt for working and not being there for everything.

[DDMP20]

I supplied the bold above. Simply put, my guess is that I am essentially one of the dads you describe above. My take on this and the perspective of the poster to whom you were replying, is that much of this is no more than rationalization of our own life choices. Why bother? At the end of the day, I have come to realize this is how I am wired. I rely on my wife to essentially point me in the right direction, and I'll jump through hoops to be there when it is important. But I will also jump through hoops to engage in my own activities (i.e. sports, etc.). In my own rationalized view of the world I say do my kids really need all of my attention on them? Now as they enter high school my guess is they feel more than enough attention on them. To some extent I feel that among my greatest gifts to them is to live my own life and to give them room to live theirs. Ultimately anything they will do will depend on what is inside. This also impacts how my relationship with them evolves. But that is just me. We can all derive great joy from our kids, but in my opinion too many give them the added pressure of being the primary source of their parent's happiness.

Each family has it's own formula for happiness and I get the notion of giving the kids space and taking time for yourself as a parent. Both of these are healthy behaviors. However I often see parents that spend little to no quality time at all with their kids. Providing for a family financially and maintaining a career can be time consuming and you might not be able to be there for every little thing in a child's life. That's understood but if you can't be there for any little thing in a child's life then why have them in the first place? My kids are still young so I spend as much time as I can with them and I know they appreciate it. I'm sure those of you with older kids are right when you say they need more space as they get older. However I don't think anything in my life could ever give me as much joy as the opportunity to maintain close relationships with my children until the day I die. I'm far more impressed by the plumber who managed to be there for those little moments in his kids lives than I am by people like Steve "he changed the world of tech forever but didn't even admit his daughter was his until she was 19 years old" Jobs.

There's been a lot of talk about how a career can provide a "safe place or nice place to live" which has "good schools" and the desire to "have the best." To me, a certain portion of those who speak like this are, in reality, just snobs who like to look down their noses at others. I remember listening to one of the Saturday morning money shows on talk radio a while back. A man called in with what he considered to be a dire problem. Apparently he was making something like 300K but times were getting tough for he and his family and they were going to have to do the unthinkable and cancel one of their country club memberships. He was going on and on about how awful it was that he might have to do this. The show host, to his credit, politely told the guy that other people were calling in with what most would consider more serious problems like barely being able to save for retirement and that his predicament wasn't really that bad. The moron wasn't having any of it and the host said thanks for calling and hung up on him. Some people just have no sense of self awareness, humility or compassion.

[swaption]

I supplied the bold above. Simply put, my guess is that I am essentially one of the dads you describe above. My take on this and the perspective of the poster to whom you were replying, is that much of this is no more than rationalization of our own life choices. Why bother? At the end of the day, I have come to realize this is how I am wired. I rely on my wife to essentially point me in the right direction, and I'll jump through hoops to be there when it is important. But I will also jump through hoops to engage in my own activities (i.e. sports, etc.). In my own rationalized view of the world I say do my kids really need all of my attention on them? Now as they enter high school my guess is they feel more than enough attention on them. To some extent I feel that among my greatest gifts to them is to live my own life and to give them room to live theirs. Ultimately anything they will do will depend on what is inside. This also impacts how my relationship with them evolves. But that is just me. We can all derive great joy from our kids, but in my opinion too many give them the added pressure of being the primary source of their parent's happiness.

Each family has it's own formula for happiness and I get the notion of giving the kids space and taking time for yourself as a parent. Both of these are healthy behaviors. However I often see parents that spend little to no quality time at all with their kids. Providing for a family financially and maintaining a career can be time consuming and you might not be able to be there for every little thing in a child's life. That's understood but if you can't be there for any little thing in a child's life then why have them in the first place? My kids are still young so I spend as much time as I can with them and I know they appreciate it. I'm sure those of you with older kids are right when you say they need more space as they get older. However I don't think anything in my life could ever give me as much joy as the opportunity to maintain close relationships with my children until the day I die. I'm far more impressed by the plumber who managed to be there for those little moments in his kids lives than I am by people like Steve "he changed the world of tech forever but didn't even admit his daughter was his until she was 19 years old" Jobs.

There's been a lot of talk about how a career can provide a "safe place or nice place to live" which has "good schools" and the desire to "have the best." To me, a certain portion of those who speak like this are, in reality, just snobs who like to look down their noses at others. I remember listening to one of the Saturday morning money shows on talk radio a while back. A man called in with what he considered to be a dire problem. Apparently he was making something like 300K but times were getting tough for he and his family and they were going to have to do the unthinkable and cancel one of their country club memberships. He was going on and on about how awful it was that he might have to do this. The show host, to his credit, politely told the guy that other people were calling in with what most would consider more serious problems like barely being able to save for retirement and that his predicament wasn't really that bad. The moron wasn't having any of it and the host said thanks for calling and hung up on him. Some people just have no sense of self awareness, humility or compassion.

Not sure if you want my opinion, but I'll give it anyway. Honestly, comes across as way too much rationalization. Just be happy with your own choices and lot in life. The values and motivations you seem to ascribe to others are merely a crutch to help rationalize your own life choices. My decision to have kids has little to do with to what extent I am there for the little things, because my decision to have kids was not entirely for my benefit. If I want to be there for the little things or anything, then I'll be there. Last night I hastily exited the office early because the siren call went out for help that my youngest daughter needed with math. I know what my expectations are for the relationship I will have with my kids, and it could be completely different from the expectations of others. You know it's kind of funny, I tend to think highly of myself, the choices I have made, and the life I lead. To some extent I carry myself in a way that is consistent with that. I guess to an outside observer that could make me a snob. But labels aside, whatever path one takes, isn't that what we all really want?

[vitaflo]

We have a large number of W-2 employees and contract software folks. Many make exactly the trade highlighted in blue. Some absolutely prefer one side or the other in that trade. Seems to me that most I have talked to have a clear preference.

The folks who prefer the contract route are willing to take the risk for extra money. Mostly they believe in themselves and their skills.

Many also have spouses with good incomes and health insurance and such, which mitigates the risk.

There is no risk for most of the ones I know. They have a network of people that would vouch for them and they could have a normal job in under a week. Health insurance used to be an issue pre ACA but now a days it is just a 12k expense.

From what I can see that risk was real in 2008. Beware thinking the recent past has to continue.

I can only speak for myself because I went the contract route in 2009, but the downturn is what allowed me to do so. So many people got laid off (outside of tech) and companies were looking to automate a lot of what those people did and invested in software to do so. Software written by contractors because they didn't want the expense of long term employees. Easily the best financial/business decision I ever made was to take the risk and start my own consulting business during the downturn. It's been ridiculously easy to find work.

Now if you want to talk real risk, we can talk about the dot.com bust. That one hurt.

[William Million]

So many angry people in this thread....

I've had many clients who make well north of $300k a year and they have varied backgrounds and fields. Doctors (usually specialized), some Law Partners (although law seems to be feast or famine - some attorneys are crushing it, others are making less than my teacher wife), Dentists, Orthodontists, etc. Even a lowly little CPA could make north of $300k if they rose to partner in the right firm.

Aside from the big professions (dentist, surgeons, orthodontists, etc) the way to make $300k is to utilize cheaper labor/costs below you and sell at a higher price and keep the spread. This is how Law partners, CPA partners, etc get to those income levels because they essentially are building a business that just happens to sell their professional service that they went to school to learn. The technical aspects of their education and training are great, but the real money is made in the growing of a client base and then leveraging lower paid associates to produce the work and then replicating.

One of the wealthiest clients I've ever dealt with doesn't even have a college degree and if you saw him pull up to a restaurant in his used F250 and blue jeans many educated professionals would probably not think much of him, even though he's got a blue collar business and has around $35 million in cash or cash equivalents.

I'm not saying that we all need to skip college by any means, but the point is to say that selling a service that is in demand and leveraging lower costs to provide the service are the key to big incomes. Whether you are a W2 surgeon working for a hospital group or a blue collar business guy who rents out heavy equipment, you're selling something for a higher price than you paid for it. The surgeon is selling his time and expertise to a hospital (that also must stay in business), the blue collar guy is selling his product/service directly to customers.

No matter what you do, you've got to be dedicated and ready to sacrifice a lot of time either in education or building a company.

Difference between doctors and lawyers seems to be even a mediocre doc earns well, but not a mediocre lawyer. However, doctors start their earning rather late. Anyway, I would go into either profession solely for the money. If money was my sole motivator, I'd start a business and work my butt off.

[ks289]

So many angry people in this thread....

I've had many clients who make well north of $300k a year and they have varied backgrounds and fields. Doctors (usually specialized), some Law Partners (although law seems to be feast or famine - some attorneys are crushing it, others are making less than my teacher wife), Dentists, Orthodontists, etc. Even a lowly little CPA could make north of $300k if they rose to partner in the right firm.

Aside from the big professions (dentist, surgeons, orthodontists, etc) the way to make $300k is to utilize cheaper labor/costs below you and sell at a higher price and keep the spread. This is how Law partners, CPA partners, etc get to those income levels because they essentially are building a business that just happens to sell their professional service that they went to school to learn. The technical aspects of their education and training are great, but the real money is made in the growing of a client base and then leveraging lower paid associates to produce the work and then replicating.

One of the wealthiest clients I've ever dealt with doesn't even have a college degree and if you saw him pull up to a restaurant in his used F250 and blue jeans many educated professionals would probably not think much of him, even though he's got a blue collar business and has around $35 million in cash or cash equivalents.

I'm not saying that we all need to skip college by any means, but the point is to say that selling a service that is in demand and leveraging lower costs to provide the service are the key to big incomes. Whether you are a W2 surgeon working for a hospital group or a blue collar business guy who rents out heavy equipment, you're selling something for a higher price than you paid for it. The surgeon is selling his time and expertise to a hospital (that also must stay in business), the blue collar guy is selling his product/service directly to customers.

No matter what you do, you've got to be dedicated and ready to sacrifice a lot of time either in education or building a company.

Difference between doctors and lawyers seems to be even a mediocre doc earns well, but not a mediocre lawyer. However, doctors start their earning rather late. Anyway, I would go into either profession solely for the money. If money was my sole motivator, I'd start a business and work my butt off.

The different job prospects and salaries in the medical profession and law would seem to arise partly from supply and demand.
In 2013 there were 44,000 law school graduates in the US competing for about 20,000 job openings. In 2013 there were about 18,000 US medical school graduates and 27,000 residency training openings. Thousands are filled by international graduates and hundreds are left unfilled. Some graduates go into other professions.

[Cramerica]

Inventing a time machine would definitely more than double your salary.

I think a big advantage of engineering (not an engineer, but my brother, uncle, and grandfather-in-law are) is that you can make a good salary ($50k-$80k) with only a bachelor's degree. An engineer starting at age 22 with a $60k salary and little student loan debt has a huge head start over an MD starting at age 34 with $200k or more in debt, even if they do make $180k per year.

I am late to the party and haven't read the rest of the thread but just wanted to clarify here.

Most MDs do not start earning money at 34. You start earning between 50-65k during residency immediately after med school. For me, this was at age 25. Most residencies also include options for 401k, HSA, and other health and disability benefits.

You can also moonlight during residency to significantly increase your income. I am in a specialty with a long training track and I will begin to earn >300k starting at 31-32 with likely increase by 35.

[White Coat Investor]

Inventing a time machine would definitely more than double your salary.

I think a big advantage of engineering (not an engineer, but my brother, uncle, and grandfather-in-law are) is that you can make a good salary ($50k-$80k) with only a bachelor's degree. An engineer starting at age 22 with a $60k salary and little student loan debt has a huge head start over an MD starting at age 34 with $200k or more in debt, even if they do make $180k per year.

I am late to the party and haven't read the rest of the thread but just wanted to clarify here.

Most MDs do not start earning money at 34. You start earning between 50-65k during residency immediately after med school. For me, this was at age 25. Most residencies also include options for 401k, HSA, and other health and disability benefits.

You can also moonlight during residency to double and sometimes triple your income. I am in a specialty with a long training track and I will begin to earn around 350-450k starting at 31-32 with likely increase to 500-600 by 35.

I don't know if you are aware of it or not, but your situation is very different from average. For instance, I was 28 before starting residency. Others are older. Most specialties also don't start anywhere near $350K, and top out long before $600K. In fact, the average physician salary (not starting salary) is much closer to $200K.

[Cramerica]

Inventing a time machine would definitely more than double your salary.

I think a big advantage of engineering (not an engineer, but my brother, uncle, and grandfather-in-law are) is that you can make a good salary ($50k-$80k) with only a bachelor's degree. An engineer starting at age 22 with a $60k salary and little student loan debt has a huge head start over an MD starting at age 34 with $200k or more in debt, even if they do make $180k per year.

I am late to the party and haven't read the rest of the thread but just wanted to clarify here.

Most MDs do not start earning money at 34. You start earning between 50-65k during residency immediately after med school. For me, this was at age 25. Most residencies also include options for 401k, HSA, and other health and disability benefits.

You can also moonlight during residency to double and sometimes triple your income. I am in a specialty with a long training track and I will begin to earn around 350-450k starting at 31-32 with likely increase to 500-600 by 35.

I don't know if you are aware of it or not, but your situation is very different from average. For instance, I was 28 before starting residency. Others are older. Most specialties also don't start anywhere near $350K, and top out long before $600K. In fact, the average physician salary (not starting salary) is much closer to $200K.

The average age of a starting med student is now 24. Even using this, they would start residency at 28 and begin earning, on average, 55k per year during residency. Most people go into primary care ( internal medicine, family med, emergency med), which is just a 3 year residency. On average, they would finish residency at 31. These numbers are quite different than what has been posted in this thread. The biggest difference is that people forget we are paid 55k on average during residency. It is also common for senior residents to moonlight and significantly increase their income.

[Cramerica]

Hi guys. Interesting thread. My daughter who is a HS junior is considering taking up computer science or some IT related degree for college versus premed, then medical school. I've done some crude calculations of which career would lead to a higher net worth by age 52. I hope you would check my assumptions and calculations to see if my thinking is correct.

Assumptions A:

1. she finishes computer science at age 22, and starts working right away
2. no student loans to pay off, zero debt and zero net worth at 22
3. CS salary at $100K, saving 10% of salary per year ($10k)
4. invests in the usual retirement accounts with annualized return of 7%
5. works for 30 years until age 52
6. ends career at age 52 due to ageism in tech sector
7. her portfolio at 52 is $1,020,726.64

Assumptions B:

1. she goes to premed, then med school, then residency training, finishing that at age 30
2. no students loans or other debt, zero net worth at age 30
3. starts practicing right away, makes $200k per year, saves 10% ($20K) per year
4. invests in the usual retirement accounts with annualized returns of 7%
5. works for 22 years until age 52
6. her portfolio at age 52 is $1,068,718.90

She comes out ahead at age 52 if she worked as a doctor even though she only had 22 years to compound her money.

BTW, I used this investing calculator http://investor.gov/tools/calculators/c ... calculator

Thoughts?

Just wanted to reiterate here that your assumptions for B are fine except for not including the average 55k annual salary during residency. If she does a 3 year residency, that's an extra 165k. This also does not take into account food, retirement, health, and disability benefits during residency. Some programs also offer subsidized housing, concierge, and other free or discounted services. It also does not account for moonlighting during residency, which is common and lucrative.

I think it is fair to say that option B comes out significantly ahead on average from a purely financial perspective.

[jackholloway]

Failure modes matter - I know many CS people that switch careers into a fairly enumeration part of tech, and make good tech money. Further, when the tech bubble crashes, they can likely find a similar spot in whatever becomes big, (Aerospeace to software was the last transition, and the agile survived.)

I know many doctors that made it through the expensive part of the degree, then discovered they hate the practice of medicine, Medicine is also changing, and while doctors will stay well paid, they may not stay at the 350k plus levels brought up in this thread. That is part of life, but it sucks to have high debt, a a late start, and a job you hate.

I suggest that a student would do well to copper their bets by studying what they most enjoy, and have as many options as they can. If they do have talent for both medivpcine and tech, study some of both until the decision has to be made.

[A-Commoner]

Failure modes matter - I know many CS people that switch careers into a fairly enumeration part of tech, and make good tech money. Further, when the tech bubble crashes, they can likely find a similar spot in whatever becomes big, (Aerospeace to software was the last transition, and the agile survived.)

I know many doctors that made it through the expensive part of the degree, then discovered they hate the practice of medicine, Medicine is also changing, and while doctors will stay well paid, they may not stay at the 350k plus levels brought up in this thread. That is part of life, but it sucks to have high debt, a a late start, and a job you hate.

I suggest that a student would do well to copper their bets by studying what they most enjoy, and have as many options as they can. If they do have talent for both medivpcine and tech, study some of both until the decision has to be made.

Or how about hedging some by taking up CS as a premed degree, then go on to med school. I know some docs who took up music or other non-biological/non-STEM majors for undergrad, then became excellent physicians.

[A-Commoner]

Hi guys. Interesting thread. My daughter who is a HS junior is considering taking up computer science or some IT related degree for college versus premed, then medical school. I've done some crude calculations of which career would lead to a higher net worth by age 52. I hope you would check my assumptions and calculations to see if my thinking is correct.

Assumptions A:

1. she finishes computer science at age 22, and starts working right away
2. no student loans to pay off, zero debt and zero net worth at 22
3. CS salary at $100K, saving 10% of salary per year ($10k)
4. invests in the usual retirement accounts with annualized return of 7%
5. works for 30 years until age 52
6. ends career at age 52 due to ageism in tech sector
7. her portfolio at 52 is $1,020,726.64

Assumptions B:

1. she goes to premed, then med school, then residency training, finishing that at age 30
2. no students loans or other debt, zero net worth at age 30
3. starts practicing right away, makes $200k per year, saves 10% ($20K) per year
4. invests in the usual retirement accounts with annualized returns of 7%
5. works for 22 years until age 52
6. her portfolio at age 52 is $1,068,718.90

She comes out ahead at age 52 if she worked as a doctor even though she only had 22 years to compound her money.

BTW, I used this investing calculator http://investor.gov/tools/calculators/c ... calculator

Thoughts?

Just wanted to reiterate here that your assumptions for B are fine except for not including the average 55k annual salary during residency. If she does a 3 year residency, that's an extra 165k. This also does not take into account food, retirement, health, and disability benefits during residency. Some programs also offer subsidized housing, concierge, and other free or discounted services. It also does not account for moonlighting during residency, which is common and lucrative.

I think it is fair to say that option B comes out significantly ahead on average from a purely financial perspective.

You are correct here, residents/fellows do earn salaries from which they can save a small amount of money. So the doctor doesn't actually start at zero net worth at age 30...provided she doesn't take out student loans.

[quantAndHold]

Hi guys. Interesting thread. My daughter who is a HS junior is considering taking up computer science or some IT related degree for college versus premed, then medical school. I've done some crude calculations of which career would lead to a higher net worth by age 52. I hope you would check my assumptions and calculations to see if my thinking is correct.

Assumptions A:

1. she finishes computer science at age 22, and starts working right away
2. no student loans to pay off, zero debt and zero net worth at 22
3. CS salary at $100K, saving 10% of salary per year ($10k)
4. invests in the usual retirement accounts with annualized return of 7%
5. works for 30 years until age 52
6. ends career at age 52 due to ageism in tech sector
7. her portfolio at 52 is $1,020,726.64

Assumptions B:

1. she goes to premed, then med school, then residency training, finishing that at age 30
2. no students loans or other debt, zero net worth at age 30
3. starts practicing right away, makes $200k per year, saves 10% ($20K) per year
4. invests in the usual retirement accounts with annualized returns of 7%
5. works for 22 years until age 52
6. her portfolio at age 52 is $1,068,718.90

She comes out ahead at age 52 if she worked as a doctor even though she only had 22 years to compound her money.

BTW, I used this investing calculator http://investor.gov/tools/calculators/c ... calculator

Thoughts?

This is not a bad analysis. One thing to note, though, is that investing through a tech career is arguably less risky. Since the investment returns are spread into a larger number of years, a down year during the investment period will have less of an impact on the end total.

On the flipside, though, I suspect that job stability is better for physicians. Tech jobs are plentiful right now, and the money is flowing freely, but we tend to forget that both tech employment and income are affected during economic downturns. Like today, the late 90's were great. We all made piles of money. The 2000's, not so much. Most of us had periods of unemployment and took pay cuts at some point during that period. For example, my compensation peaked in 1999, and between stock market crashes affecting my stock and recessions affecting my base pay, I didn't catch up to my 1999 comp until 2012. A physician's compensation and job prospects would likely have been steadier during that period.

[Vilgan]

Hi guys. Interesting thread. My daughter who is a HS junior is considering taking up computer science or some IT related degree for college versus premed, then medical school. I've done some crude calculations of which career would lead to a higher net worth by age 52. I hope you would check my assumptions and calculations to see if my thinking is correct.

Assumptions A:

1. she finishes computer science at age 22, and starts working right away
2. no student loans to pay off, zero debt and zero net worth at 22
3. CS salary at $100K, saving 10% of salary per year ($10k)
4. invests in the usual retirement accounts with annualized return of 7%
5. works for 30 years until age 52
6. ends career at age 52 due to ageism in tech sector
7. her portfolio at 52 is $1,020,726.64

Assumptions B:

1. she goes to premed, then med school, then residency training, finishing that at age 30
2. no students loans or other debt, zero net worth at age 30
3. starts practicing right away, makes $200k per year, saves 10% ($20K) per year
4. invests in the usual retirement accounts with annualized returns of 7%
5. works for 22 years until age 52
6. her portfolio at age 52 is $1,068,718.90

She comes out ahead at age 52 if she worked as a doctor even though she only had 22 years to compound her money.

BTW, I used this investing calculator http://investor.gov/tools/calculators/c ... calculator

Thoughts?

Just wanted to reiterate here that your assumptions for B are fine except for not including the average 55k annual salary during residency. If she does a 3 year residency, that's an extra 165k. This also does not take into account food, retirement, health, and disability benefits during residency. Some programs also offer subsidized housing, concierge, and other free or discounted services. It also does not account for moonlighting during residency, which is common and lucrative.

I think it is fair to say that option B comes out significantly ahead on average from a purely financial perspective.

Moonlighting flows both ways tho, as it is very lucrative in tech. Also, 55k in residency seems fine to discount as simply paying for expenses. If the assumption is only 10% of 100k/year is saved, then 55k during residency is probably not going to result in much saved.

I think the main takeaway from the tech vs medical comparison is that its close and either way is very practical. Actual performance is going to deviate massively from this since both tech and medical offer significant income from moonlighting and huge variations in actual income experienced. I went the tech route at a meh school and make more than most doctors. Go with whichever one is more appealing and results should be fine. I think the main thing to do is to assume either path will be fine monetarily and look for other pros and cons of tech vs med.

Note: I think examining the assumption of premed is worth doing tho. Its been a few years for me but my memory was that premed was generally a bad idea as it left you few options if you end up hating medicine. Why not go with an undergrad that has $$ earning potential and THEN go to med school if she is still interested? Committing the rest of your life to the doctor path when you are 18 seems.. rough.

[blackjack4808]

I don't make nearly what some of these high earner careers but as a UPS driver; i personally think i got it way better than most high level careers; I make close to 100k and could make up to 120k; I have fantastic health insurance which i pay nothing for and i have a fantastic pension; oh and i never spent a dime on education. oh the best part is i drive around delivering stuff...