vampiro

lol...well u wont starve but i just meant that o'course these jobs offer a more relaxed working environment but when it comes to hard cash it doesn't beat the professions i mentioned....Money after all is money is guy A is making 300k an year (at $70/hr) and B is making 90k (at $60/hr) its still only guy A who can buy a Brand new Porsche or a real expensive house without pushing himself too much....


" Additionally, there are other opportunities to make money--royalties and consulting, for example. "
By this...did u mean to show them as professions where people make money or did u mean to say that proffs can do those stuff and make additional money.....

anyways as u mentioned royalties..by that i would assume making something and well there aint anything that can beat entrepreneurship...i mean for a techie banking and stuff should always be secondary i.e. if he is not able to make a breakthrough..

pip-pip

I meant those were things profs could do to make extra money. And I'll agree, there's nothing that can beat entrepeneurship.

Alot of the profs I've known are quite well-compensated; I was as conservative as possible in breaking it down hourly. My friend started off at 100k a year at 27 years old. Another friend makes more per hour than his brother at an NYC white shoe firm. I also live a few blocks from the Yale prof neighborhood; those guys are not exactly going without.

Regardless, noone chooses to be a prof for the money or the lifestyle. But it's nice to know it's being rewarded.

sakky

I can believe that a family doctor could pull in 500k in REVENUE. But he also has to pay to maintain the office, pay his staff workers, pay for malpractice (a VERY big deal), pay to market his services, etc. etc.

Secondly, I would not call entrepreneurship a "low stress job" by any means. Any entrepreneur, including private practice doctors, takes on massive risk by having his own business, including putting his entire personal wealth in jeopardy. And it has nothing to do with malpractice (which is a whole 'nother area of risk), but rather just liability risks. For example, if you have your own business, and somebody slips and falls on some ice on your pavement and seriously injures himself, that guy is going to sue you. If one of your employees sexually harrasses a patient, that patient is going to sue both you and your business. It's not enough to simply incorporate yourself, because if the lawsuit is big enough, the plaintiffs will go after not only your business's assets, but your personal assets as well. And then you always run the risk of running afoul of some government regulation that you have never heard of, and having the government seize your business and your personal assets. The laws regarding small-business regulation and taxation are simply voluminous. Every entrepreneur I know is paranoid that they might be breaking a law that they had never heard of before.

Heck, I know some former entrepreneurs that have basically given it up and taken regular salaried jobs for the simple reason that they got tired of the risk to their personal wealth. If you take a regular salaried job and you do something bad, the worst thing that can happen is you get fired. But if you're a small business owner and you do something bad, you can be made bankrupt through a lawsuit or a government seizure.

sakky

I agree that nobody chooses to be a prof for the money. But the lifestyle? I think that quite a few people want to be profs for the lifestyle. It's actually a very very enjoyable lifestyle for a certain kind of person. This is particularly so once you get tenure, which makes you unfireable. Once you have tenure, then as long as you do the bare minimum of what is asked of you, you have a job for life. That gives you complete freedom to research and study precisely the topics that you want to do, and not things that don't interest you. Or if you prefer to spend your time doing consulting or starting your own business on the side, you can do that instead. Plenty of engineering, science, business administration, and economics profs do exactly that and become quite wealthy through their side activities.

The point is, depending on your personality, the prof lifestyle can be an excellent lifestyle.

pip-pip

When I said lifestyle, I meant the McMansioned, Porsched, trophy wifed lifestyle.

No, what you're describing is the precise reason why I want to be a prof. That, and I'd go absolutely out of my mind at a normal job.

mpnsoft

Sakky:

With all due respect to your entrepreneur friends, I have owned and operated a C Corporation since 1985 that does business in all 50 states. Though it takes a certain temperament to be self-employed, handle employees, and deal with customers, I believe the stress level of being an entrepreneur is comparable to being an employee with an equivalent degree of responsibility.

Also, though there are situations where the personal liability protection afforded a C corporation can be lifted by the courts, that’s atypical. Of course, a self-employed physician (among others) is personally liable for any court levied judgments.

Massive risk? That depends on quite a few factors. I can point to examples that both make & refute your point among my friends & colleagues. “The grass is always greener on the other side of the fence” is an adage that may apply here. For instance, many employees are frustrated with their lack of control at their place of business – just one of many stressful workplace factors… Employer funded, defined benefit pension plans are becoming extinct… The list goes on.

I know many people on both sides of this fence. By & large, the entrepreneurs seem to have more freedom & job satisfaction than their counterparts who are employed at various corporations. BTW, I’m not sure whether your “entrepreneur” references are aimed mostly at self-employed individuals or businesses that include employees. I’m referring to both types…

sakky

I highly doubt it. Again, think about the situations. As an employee, what's the absolute worst thing that can happen? You get fired. But as an entrepreneur, you can be sued out of all your possessions.

Furthermore, you have to fund all of the infrastructure of your company yourself. For example, if you are an employee, and your office building gets destroyed by fire or terrorism or whatever it is. You just shrug your shoulders because it's not your property that got destroyed. Again, the worst thing that can happen to you here is that you get laid off because the company doesn't have the money to pay you back. But if you are the company owner, then it is your building and your property that got destroyed. So it is up to you to try to recoup your losses via your insurance company, and if they are not forthcoming (i.e. they have a clause that says that we won't reimburse for certain conditions that happened to be invoked), then you're screwed.

Basically, the point is, as an entrepreneur, you're putting far more on the line. To even start a company, you usually have to go into debt to create an office, advertise, hire initial staff, and so forth. So if your business fails (as 90% of all new business ventures do), then you're stuck paying back that debt. Contrast that with a regular employee. Worst thing that can happen is you get fired. But you never have to put up your own debt to take a regular job.


I think this mostly has to do with self-selection. The people who are entrepreneurs are not randomly selected. Rather, they are the ones who happen to have a high tolerance of risk. Sure, these people are happy because they have the psychological profile for it. That doesn't mean that others should do the same. Some people have the psychological mindset for entrepreneurship. Others don't. That's my point.

sakky

There are a number of profs who have that. For example, if you can become a tenured prof at a prestigious business school, like HBS or Stanford, you can definitely have that kind of lifestyle.

But like I said, if you just want money and glamour, then don't become a prof. Just go to investment banking.

mpnsoft

Sakky:

“As an employee, what's the absolute worst thing that can happen? You get fired. But as an entrepreneur, you can be sued out of all your possessions.”

As I had pointed out in my prior post, that’s simply not true. It only applies to certain businesses (e.g. doctor, lawyer), sole proprietorships, or designated S corporations. If you were one of my customers, you wouldn’t have the right to sue anything other than the corporate entity for assets owned by the corporation. You can’t attach my personal possessions. That’s a matter of law, not my opinion.

Your other example is rather extreme. Building destroyed? Terrorism? Perhaps you know some people who’ve suffered grave misfortune? Regardless, your examples seem to be about possibilities, not realities. And, BTW, I live in the NYC area and both family & friends were personally affected by destroyed buildings & terrorism a few years ago…

As far as debt is concerned, that depends. Often, startups do require loans and personal guarantees. Mine didn’t. My wife’s didn’t (she’s owns & operates a multi-disciplinary facility that provides health care). Both are over two decades old & were started with little no or no debt. Again, I can cite many specific examples. You’re talking about generalities.

Regardless, research by economists such as Thomas Stanley, author of books such as “The Millionaire Next Door” repeatedly indicates that entrepreneurs make up a large percentage of those who are well compensated… which I believe was the original subject of this thread… I simply don’t think you should discourage (disparage?) entrepreneurship.

And sure. You’re right. Businesses fail (your 90% figure). And when they do, employees can lose as much as or more than employers. If I go out of business, what happens to the employees who have outstanding mortgages and rely on that income to pay all their bills? You assume I (as the business owner) have higher debt than they do… you’d be mistaken. I suppose you also assume they'll immediately find new jobs...

Again, though I’m sure it’s not your intent, I simply think you’re being somewhat extreme…

mpnsoft

Oops! Mistake on my prior post (#24). S corporations have limited liability... did not mean to type that!

vampiro

Since we are having a good discussion here...Can anyone tell me

1.how to get every and i mean each and every information regarding Finance industry.. Information as in the terminoligies and practices in the various fields...Like i can read WSJ because it tells regularly about good things happening in Investment Management or Hedge Funds,NO I want to know what exactly Imanagement or I banking or Operations and research fields are and what they deal with...Basically some literature which will get me thorough with every field of Financial Industry (many books, some sort of trivia book anything).....


2.Also if u check out the subjects available for AP tests we see that there are only 2 subjects Micro and Macro Economics that are sort of preparatory for a career in finance...As I originally have an intense science background will studying the prescribed tests for these(Econ) subjects put me onto the max level a person can prepare for these fields in High school....(Basically i dont care if a college gives me credit or not for the course i just want information and knowledge...as in Finance they already hire any major as long as GPA is good)...Also is it required in the first place to even know Econ in order to move to finance..Also tell me whether students interested in Finance do any other reading in High school ( I have a good 3 months ahead of me so i want to make myself at par with any high school kid who has done such courses in high school)

mpnsoft

Knowing all the car brands & models won’t make you an engineer. Knowing about funds doesn’t qualify you to run one. Many paths can get you there. Both my sister-in-law & brother-in-law got job experience at NYC firms after college and then went back for MBA’s in Finance (hers from U. Chicago; his from Wharton). Their undergrad degrees were in general business/economics/etc. He’s a Managing Director at Credit Suisse. She’s at MacKay Shields (specializing in bonds) and has taken multiple certification exams post MBA. One close friend got there with a math degree from Seton Hall. He’s now at Credit Suisse as well. Another's at Smith Barney/Citigroup. There are many variations on this theme and many different courses/degrees/backgrounds that will get you there. Being a math whiz is a plus. Memorizing WSJ cover to cover isn’t. Get good grades in college… look for serious internship opportunities… and hope the right firm takes an interest in you… All these people do have a few things in common: they’re highly intelligent, driven, and resourceful. And some of them still work an amazing # of hours each week. So... read whatever interests you... *because* it interests you -- not because you expect it to make a career difference. Memorizing the dictionary isn't a guarantee that you'll become a prolific writer.

Drew00

I dunno man. My dad is an engineer (though I do believe he'd be considered management) and he makes quite a fine paycheck (200-300k/year.)

vampiro

ummm I think you guys got me wrong...See i know knowing about something does not make you good at it but how the hell am i supposed to know whether i want to pursue Investment Management or Equities or Investment Banking unless i know what they are about...So thats what i wanted to ask....Tell me what sort of literature i should refer to get a background on the stuff , I know that once i enter a job then its my application of the material but i just want to gain information on the market what terminoligies mean etc.....
I mean u answer me....if u dont even know what Programming is all about will u just blindly opt for a CS major in college.....

Btw I am going to major in Computer Science....is this a good proposition for Finance career (people have told me that CS and Math majors are very much in demand on Wall Street aka Finance industry)....I Think i do have a half a mind to minor in finance or econ...which one would be better for a career in Finance...

sakky

No, actually it applies to ALL cases. Again, take the case of the guy who slips and falls on an icy patch on your sidewalk and breaks a bone. You better believe that he is going to sue whatever business shell you are using (corporation or whatever) and if that isn't enough to pay his bills, then he is going to furthermore sue you personally. And that IS a matter of law. This is something that you can look up. You can't just run a business that hurts somebody and then just walk away from all of the obligations by just hiding behind a corporate shell. Otherwise, everybody would do that.

In fact, this is precisely the problem that many would-be entrepreneurs run into. I happen to know quite a few people who would love to be entrepreneurs, particularly selling computer services to companies (i.e. setting up and upgrading computer networks, servers, and so forth). But what's the major hangup? Liability. Basically, if they screw something up on the job that causes a customer's computer systems to go down, the customer will sue them, bankrupting not only whatever corporate shell they are using, but potentially their own personal beings as well. That's why most of them don't become entrepreneurs. They checked it out with their lawyers and there is no way to get around it. In short, there is no way that you can completely shield yourself from all personal liability as an entrepeneur.

Besides, look at it from the standpoint of the customer. Let's say that you are a big company that needs to upgrade your computer systems. So you hire one of these computer consulting companies (which are usually just small shops), and they come in and screw up your existing systems, causing all your systems to go down for several days, resulting in lost productivity and lost e-commerce sales. You know that you are going to want to sue that consulting company. If that consulting company is just a corporate shell, then you will want to sue the individual entrepreneur too. After all, you ought to be recompensed for all those days of lost productivity. Otherwise, rich entrepeneurs would simply create new corporate shells all day long, knowing that they can never lose their possessions. So they set up company A, and that company gets sued our of existence. So then they set up company B, and that company also gets sued out of existence, and then they set up company C, etc. etc. Everybody would do this then and lawsuits would be pointless because you would always be attacking an empty corporate shell.

It doesn't have to be extreme. It can just simply be an economic downturn. It can be just a random lawsuit. It can be a whole hosts of factors.


Uh, of course we have to talk about generalities. After all, we might as well talk about people who win the lottery. That's the easiest way I know of to become a millionaire. However, the GENERALITY is that playing the lottery will lose money. Just like there are people in the world who smoke 3 packs a day and still live to be a 100. However, the generality is that smoking will reduce your life expectancy.

I am not trying to discourage anything, I am merely stating that entrepeneurship takes a certain mentality that not everybody has. Are successful entrepeneurs well compensated? Of course. But that doesn't mean that everybody should become one. The real question is whether you can take the risk of not having a steady paycheck.

The difference between entrepreneurship and "employee-ship" is quite fundamental. Entrepeneurs only make money when the business is profitable. But employees make money no matter what. Whether the business is making money or losing money, employees still expect to get paid, and if they don't, they can sue, and they have the power of the law to force employers to pay backwages. Nor would the corporate shell work very well, as I highly doubt that the government and the courts would look too kindly at an entrepreneur who was trying to hide behind a corporate shell to avoid paying his employees. If the business makes no profit, then the entrepreneur makes nothing. But all the employees got paid their wages.

Hence, it is quite clear that the risk is far higher for the entrepreneur. It's a correlation of risk and reward. Every week that an employee works, he knows he is going to get paid. However, an entrepreneur can work for a whole week and get paid nothing. Entrepeneurs get all of the upside, but also all of the downside.

This is why I have seen many former entrepreneurs got regular jobs during the 2001 downturn. This was particularly true in Silicon Valley where many people who had struck out on their own as independent computer consultants found that there was no consulting business to be had and they needed a steady paycheck, so they took a regular job.

The point is, everybody has to assess whether they really have the risk profile associated with entrepreneurship or not. Some people have it. Some people don't. We should not encourage people who don't have the risk profile to try entrepreneurship.

Besides, I said it before, I'll say it again. If all you care about is money, then just go and become an investment banker. A lot of entrepreneurship happens in banking too - i.e., a lot of successful bankers go off to start their own hedge funds and private equity firms. But again, you have to ask yourself whether you can tolerate the banking lifestyle.


I don't want to be harsh, but 200-300k is a rounding error for the top bankers. The best bankers can literally make more than 100x that.