Kid doesn’t want a low paying major…

Parents Forum
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Most jobs in finance are “horizontal” , not vertical. Meaning they are not in the Financial Services/Banking sector, they are regular finance roles for regular companies (i.e. horizontal).

The folks who work on the pricing team at Pepsi. People who work in treasury at Merck. Tens of thousands of finance professionals in state and local government- whether their specialty is budgeting, costing out health insurance, spending reserve funds when a bridge falls down. The military- thousands and thousands of civilian finance professionals on both the government side and private contractors/producers of military equipment. Healthcare companies- SO MANY FINANCE PEOPLE.

And yet every kid on CC wants to work in M&A for Goldman Sachs. I don’t get it. But the “horizontal” finance jobs aren’t going away, even if the banking sector contracts significantly. Someone out there is doing a sensitivity analysis right now to figure out what’s going to happen in the Pharma industry if the “don’t vaccinate your kids” movement continues.

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Well - in our town teachers get paid pretty well, but it’s still not enough to afford most housing in the town if it is only the teacher salary the household is relying on. It’s an uncomfortable situation- people move here for the schools, place upward pressure on house prices and price teachers out.

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I used to teach high school, and now I’m a professor (so I switched careers but never left teaching), and I work with students who are preparing for teaching careers. The world needs your daughter! It’s true that teaching can be grueling at times (especially in the early years), but it’s also incredibly rewarding, and talented elementary school teachers truly change lives. As to salary – no, it’s not the highest-paying profession, but pay can be pretty good, depending on the state and district. There are opportunities for pay bumps with continuing education credits or Master’s degrees. And you really do need to take benefits into account when considering compensation – teachers typically get excellent health and retirement benefits that make up for shortfall in salary. There are also opportunities for more lucrative positions in administration, should your daughter ever want to go that route. And teaching affords a degree of job security and stability that many more lucrative fields don’t.

If she has the geographic flexibility, advise her to seek out states/districts with higher starting salaries and where teachers’ unions are legal. She’ll have the best opportunities for higher pay and benefits in those areas.

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Tagging onto @Thumper1, I am also a Speech Pathologist. Each of us is really different and we basically are independent. Our experiences are completely different, but we all serve to teach.

My career started in the hospitals and clinics, and as I had children, I transitioned to the schools, using the skills I had been taught throughout undergrad and graduate school as well as my clinical experiences. I worked with teachers who appreciated my candor and directness.

I worked with physicians who did not appreciate my candor and directness, but I also worked with wonderful physical therapy staff, occupational therapists, social workers, psychologists (daily!) and exemplary nurses everywhere.

In the schools, I worked with children who had difficulty producing language and understanding it, as well as working on articulation production, fluency (stuttering), vocal hoarseness, cleft palate nasality, augmentative communication (Steven Hawking speech), Sign language and social communication.

It’s a tough major, but you end up teaching throughout your whole career ages 0 to 99+. There’s such a need and demand for speech language pathologists in that she could write her own terms. I worked for an agency that allowed me to experience work in the public schools, hospitals, clinics and private practice.

I always had health insurance. I always had job security. I could find a job within a day and be in the HR office within three days. No, I’m not rich by any means, other than the experiences that I got with all of these families who were very appreciative of my skills. I did have a consistent income. I lived on my own for a while before I got married; my husband made triple what I made, but I really liked my job.
Was it tough? Absolutely.
Was it satisfying? Absolutely.
Was it perfect? No, but I expected that there would be times that were challenging.

Not only do you have to love what you do, you should be good at it, or you will be unfulfilled in a career that isn’t for you.

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I think there are both the practical reasons (high tuition, debt, etc.) and the social reasons (everyone else is panicked about it and has decided finance is the answer). The attractiveness of finance as a profession may vary – there was a point at which computer science was the way to go and management consulting at another point. But, helping investors make a return on money or being able to bring money to companies is always likely to pay well.

When I was developing my career, I definitely made choices that reflected the income potential of various paths. I wanted to make sure I earned a very good living. But, my choice was not to maximize income but instead to treat income as a constraint subject to a) doing something I thought was interesting; b) doing something I thought I was good at; and c) doing something with autonomy. But I invested massively in building my capabilities so that I could meet the kind of income constraint that worked for me without having to maximize income. I definitely chose not to pursue a couple of more lucrative directions – I had a job offer to work for another family office when I left the first one and later co-founded a hedge fund and we got an acquisition offer which was largely an aqui-hire from one of the most successful hedge funds. The latter would probably have created the most wealth but I did not want to do that for my career.

I think there is massive uncertainty about what jobs will exist 20 years from now. Will we need hedge fund traders? Algorithm designers? Will we need people who can structure debt? Will we need surgeons? We probably will need a lot fewer accountants, middle managers, lawyers. It really is hard to have a lot of visibility.

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My daughter works in a social worker-type role, working with people with intellectual disabilities. She loves her job and it’s extremely important as she is the one to monitor whether any abuse (physical or financial) is taking place, for example. She has families crying to her in good times and bad and she feels so valued.

She does, however, make so little that she found out she could qualify for many of the government assistance programs that she helps her clients access. And her job requires a bachelors degree, masters preferred.

I have seen similar jobs requiring masters and paying under $20/hour.

This is how society values many people and things. All over funding is being cut for mental health programs, special needs education and more. My D would never be happy in a finance type job, where you don’t see the impact of your work, except maybe when you look at your paycheck. It’s sad really.

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True. So many kids to compete with in finance. My kid just graduated in it. He never found a finance internship in any of the summers despite a good GPA and lots of applications. They start hiring super early, too, and none of us knew that. He added accounting as a double major to use up the business electives. The first Accounting internship he applied for, they instead offered him a permanent job upon graduation. He started last week! Accounting sounds boring, but you can get a job in it currently. And probably the finance jobs are not all thrilling either. I keep telling him every organization needs accountants, so you could work a lot of places.

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One of my co-worker’s daughters went into finance. She originally wanted to be ballet dancer, but that didn’t work out. She worked for a big bank (think Goldman Sachs) for a little while, but she got burned out and found out she was pregnant. She moved to a smaller company where she gets paid less, but still gets paid well. Now that she has a kid, she loves that she isn’t working 80 hour weeks and she said she will never go back to one of the big banks.

D had a friend growing up and both of this friend’s parents worked in finance. The parents were always working, even on vacation. They had 3 kids, 2 boys and 1 girl. The girl was D’s age. I remember when this girl would come to our house for playdates, she was often picked up by a nanny and when her parents did pick her up, they always seemed so frazzled. None of the 3 kids went into finance.

My step sister in law worked in finance and got burned out. She then did the bookkeeping for a small business and never looked back. Everyone said she seemed so energized and relaxed when she left her big fancy finance job.

As for teaching, I am related to a lot of teachers. My sister and her husband taught high school for many years in one of the highest paying school districts in the country. They did quite well and have been able to have a comfortable retirement. Being DINKS does help too.

My husband’s sister taught 3rd grade for many years and then moved to 6th grade. Her husband taught middle and high school math and then became a principal. They both made decent money and had comfortable retirements. They taught at a very well regarded private school that pays teachers and administrators very well. Their son even got to attend the school at a very significant discount.

I worked for years at a private school that also pays teachers and staff and administrators very well. We also got a discount for tuition for my kids. Some private schools do pay well, but they have high standards.

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If your daughter wants to earn more money (you referenced her concerns) and is ok with leaving the classroom, she can earn the necessary certifications and become a principal, vice principal, curriculum coordinator, education policy, etc.

She can also work in sales for products related to school STEM, she can work for an educational testing company, etc. I recently ordered literacy supplies from a company, and the person who assisted me with the purchase used to be a teacher. He understood the needs of the kids, what I was looking for, etc.

I think it’s great that teaching is her calling. To me, this means she will persevere when the job gets tough (and it will).

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And it becomes more expensive in the end when neglected social work problems end up becoming problems that police departments get called to deal with (homelessness, addiction, etc.).

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Everyone! Thank you so much for all the feedback! My dad was a teacher/administrator and my mom was a nurse…they had a lovely house in the suburbs and a cottage at the beach. My dad worked every summer, but it was just an accepted norm. We live in a high cost of living area, so teachers need to be part of a dual income family with a higher earning partner to be able to buy a home and take vacations etc. But, I see the earnestness in this kid and her desire to serve, and I have a really hard time squashing that in favor of earning. I appreciate that there are lots of paths she can take to pivot out of early childhood education if she decides to make a change. Thank you for reminding me that most of us didn’t have it all figured out at 16, 17, 22 or beyond! And Service to others is never a bad choice :growing_heart:

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Finance has increased its share of the economy over recent decades, presumably by exploiting its essential service to the economy to privatize gains while socializing losses. With respect to the latter, industry consolidation has allowed some companies to become “too big to fail”, causing the government to cover more losses than required (by things like FDIC and SIPC insurance) to avoid greater losses to the rest of the economy. Industry consolidation also reduces competition between firms in the industry.

So it is no surprise that more people want to work where the money is, rather than the sectors of the economy that are getting squeezed to the point where pay levels are trending toward becoming too low for any but the most frugal to live on.

https://cepr.net/publications/the-growth-of-finance-in-graphs/

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Do what you love and love what you do. If you really love your work, the money you make will be fine. If you hate the work, no amount of money will make the job one you love.

Both of our kids love what they do.

One is a freelance musician who will never make a ton of money. But he is able to pay his bills, and save too. More important, he loves what he does.

Kid 2 is a doctor and makes more money than DS. But the money is not why she is doing this work. Fact is, she loves the job.

If you work a job you love, you will be happier, than if you work a job just for the money. My opinion.

As a career public school educator, I never felt underpaid, and I always loved my work.

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Perhaps you can look into various school districts away from your current high COL area, look for States and district where being a teacher pays “enough” to have a standard middle class life and offers solid benefits. Since she’s troubled about the financial aspect, you can show her that in all of State A and B, in District Y, X, AND Z in State C, in several districts in State D there are ways to pursue a career in what she loves to do.

You can also look into States or cities that have universal preK and the conditions for working with preK kids, States with K-4 certification and preK through 4 schools…

(I think this is too complicated for a High schooler to find, especially wrt pay vs. COL and benefits, but a HS student can absolutely look at the information and compare.)

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She can major in gen ed and special ed (some schools have this, others do not).

Not only will this make her more marketable, but she can develop expertise in dyslexia and various disorders in reading, writing, and spelling.

She can earn a LOT of money as a tutor (depending on where she works or advertises her expertise). This, in addition to her teacher salary and benefits, can lead to a very nice income.

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This is an excellent point! I pay her math tutor $110/hour!

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I’m assuming this means you, the parents, are relatively high income?

If so, and the concern is the daughter’s ability to make ends meet and live a somewhat comfortable life, it might be worth looking at your own financial planning through that lens.

I sat down with a friend a few years ago with a kid in a similar situation. I was just helping out with financial planning software and this issue came up. Basically, these parents were in a position to help the kids with house purchases, to gift them the exclusion amount every year, and still projected to leave seven figures to each after a long and comfortable retirement. But the kids had no idea.

Anyway, after running the numbers this couple decided it made sense to expand the gifting and pull it forward. There were tax and planning reasons to support that decision also. The effect of that was that the kids effectively had their retirement savings and housing costs fully funded from college graduation on.

Not everyone can do that, but I thought it was worth mentioning. If you’re looking at having a lot left over, it might help your kids to distribute some early.

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Public school teachers in our area (DC metro area) do quite well. And since it is a 10 month position, many that I know get fun, part time jobs in the summer. Or teach summer school.

But I hear teaching kids after the pandemic has been extra difficult (hopefully getting better now??)

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That’s where my sister and BIL taught and they both had wonderful long careers and made good money. They had/have a wonderful life. And their careers led to a very comfortable retirement. Of course they are DINKS, so that helps a bit.

Also, you can earn a lot of money, be terrible at managing your money, and live paycheck to paycheck……

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My son in law works at a private school as the head of foreign language department. I don’t know how much he makes, but I would assume a lot less than D2 at a big law firm. She works very long hours, so he takes care a lot of household chores. When they have kids some day he probably will be primary caregiver. He does tutoring on the side. He is very financially responsible. He bought an apartment on his own in a nice part of Brooklyn before he met D2. He told me that he saved for the down payment through tutoring. He is looking to become a headmaster at one of those private schools.
D1’s sister in law is a tenured teacher in NY state. She did rounds of IVF that was paid for by her insurance and she is now 3 months pregnant with her second chi,d. She is going to take a year off after the baby is born. Her H is an electrician working for the state. He does a lot of over time. They have a very large house with all the toys and trimming.
D1 is a MD at a large bank and her husband is in software. Their apartment is 1/3 of her SIL’s house (by choice). D1 works and travels all the time, but she likes her work. She has been in IB since a junior in college.
Last week my firm let 1/3 people go. I heard stories of people with new baby, wife not able to work, people over 50 and they are not sure about getting another job. I think with AI, a lot of junior analyst jobs are going to go away. Young people should think about what careers will survive AI.

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