damaged people dot com

Hey,
I'm researching bussiness schools for after I graduate from high school and the information I'm gathering doesnt seem realistic. I figured you guys would be able to help me. From what I'm finding out from the princetonreview.com, the average graduate from Columbia University's Business School has a starting salary of over $143,000 while other ivy-league schools have more or less of that amount. Forbes also agrees with the information I am finding. Is it really realistic to believe that you can be making that much right after getting your MBA from one of these schools? I could have my MBA at 21 years old. Tuition for these schools is about $40,000 a year, 4 years equals $160,000. I figure if you planned to pay off your debt in 4 years, that would mean your living off of $100,000 a year from about the time you graduate. 21 years old. I feel like I must be missing something. Can someone help? The links for the information I found are as follows...

This
And
This

Painted wrote:Hey,
I'm researching bussiness schools for after I graduate from high school and the information I'm gathering doesnt seem realistic. I figured you guys would be able to help me. From what I'm finding out from the princetonreview.com, the average graduate from Columbia University's Business School has a starting salary of over $143,000 while other ivy-league schools have more or less of that amount. Forbes also agrees with the information I am finding. Is it really realistic to believe that you can be making that much right after getting your MBA from one of these schools? I could have my MBA at 21 years old. Tuition for these schools is about $40,000 a year, 4 years equals $160,000. I figure if you planned to pay off your debt in 4 years, that would mean your living off of $100,000 a year from about the time you graduate. 21 years old. I feel like I must be missing something. Can someone help? The links for the information I found are as follows...

This

and

This

Ummm...Paints, neither of those links work.

As for that, if you did in fact make that starting wage, figure that you are going to have Social Security taken out, plus Federal Income tax (current highest tax bracket is 35% of your gross income, while making 143K per year would place you in the 28% bracket). 1.45% of your gross income is taken for medicare and 6.2% of your gross is taken for Social Security (up to a max gross income of $87,900, based on 2004's values; this ceiling increases every year).

OK, let's do some math:

You have a base salary of $143,000 after school (not likely in Spokane):

$2073.50 goes to Medicare
$5449.80 goes to Social Security, and
$40040.00 goes to Uncle Sam

This cuts your income down to $95436.70.
If you end up living in a state that has a state income tax, money will be taken out for that. So will your contribution to your medical benefits.

At this point, you have to decide how much you want to pay off the debt versus how nice you want to live. You will have to pay all the standard bills for housing, utilities, food, clothing, transportation, etc. ( These vary by region, your cost of living will be much higher in NY or CA). The simpler you live, the more you can put down towards paying off your school loans. And from bitter experience, live simple now by choice instead of being forced to simplify because you have debt eating up your income.

OK I will try and fix the links...apparently my friend must have missed something.

The friend Says:

Youre right. But I still ask, is it realistic to believe that the average starting
wage is $140,000? I mean, I know taxes and all bring you down a ton. But, (cause I'm not working this may be totally off), isnt the average wage in spokane about $35,000? I know spokane is going to be much cheaper than where those major universities are located, but to be making 4 times what someone is making and to be making it right out of college. Those people who are making $35,000 are still paying taxes and all too (obviously considerably less.) And at the same time, if I were to pay off $40,000 a year and plan to be done with debt in 4 years, I would still have $40,000 to pay for living expenses which is pretty comfortable when single. lol, I'm sorry. I'm getting into an argument. Rather, just answer, do you think it's realistic to expect $140k?

(P.S. At 35% percent, taxes are a killer. Thats a ton of money to lose. How do people (general public) feel about numbers that high?)

One of the nasty things about the word "Average" is that it can be deceptive. Most people think that the average really means that most of the incomes used to calculate the average fall close to the Average value.

Anyone who has taken statistics can tell you that the average paints an incomplete picture of the range of incomes. There is another statistical measure called the Median that can tell a different story. The Median represents the midpoint value of the number of samples taken (in this case, the number of graduating student's incomes). 50 % of the samples fall below the median and 50% fall above.

Do you use Excel Spreadsheets? I could best illustrate this on a spreadsheet.

The bottom line is that if the median closely equals the average, then the average is a good (yet still incomplete) indicator. If the median is radically different from the average, then the average is not a good indicator to use.

As for Spokane, not likely.

It all depends on what you major in (your "specialty") and therefore what you get a job doing and where you get a job.

Almost 13 years ago I got out of college and 2 weeks later I'm making over $30,000 a year contracting with the company I'm with now. Back then, good money. For me that was huge money. Probably could have made more working at Microsoft. So it all depends. What do you want to do when you grow up? If there is high demand for it and it pays well, then theoretically you could probably make that much.

I haven't looked at the links, but my recommendation is to think about where you might like to get a job at and then research that area in the professions you are looking at going into. That will get you a better idea. Just off the top it seems like a high wage to be making for an MBA, but then I'm not in that area.

My advice: The first question shouldn't be money. The first question should be happiness. Making money is easy. Making yourself happy is altogether harder. The MBA you earn dictates the flexibility you have. And this isn't based on the experience of the idealistic loonings of some airy-fairy artist-type (separating it from the canon of my other posts). I know a couple of people who have been through this.

If you go get an expensive MBA with loans, you're married to earning the wages that pay off those loans. If you get an inexpensive MBA, you still have the ability to earn that pay, based upon your talent, that you would with a more prestigious degree elsewhere, but you also have the option of a later career change (which happens to a surprising number of people).

If you are hired into your job based upon where you earned your degree, I can guarentee you are going to be unhappy in your job. Idiots are everywhere, even in prestigious schools. Go to work for the wrong company, and you will be working with and for these same idiots.

Stop worrying about the bottom line. Start at personal satisfaction and let the rest of it slide into place.

Another nugget of experience: Depending on the field you choose to pursue, having too much education and little to no experience can make you unemployable.

It might be better to set your goal to a BA, find employment, get some experience, then continue with your education and get your MBA. Then, you'll have the degree and the experience under your belt to land your dream job with the appropriate dream salary.

Then again... I'm the guy who didn't go to college until 10 years after I graduated high school. Being married with two kids and making minimum wage pretty much sucked.

There are some shortcuts through life, Bio's living proof. I'm afraid I'm probably the definition of "the exception that proves the rule." I spent almost a whole quarter in college, it wasn't my gig.

Looking at salary.com, I'm 20% over the mean income level for my selected field (well into the 95th percentile.) On top of that, I don't pay for lunch and the company buys beer and throws a party EVERY Friday.

Believe it or not, I'm not trying to blow smoke up my own skirt on this post, there are two points I'm trying to make.

First, BF makes a good point, you can't trust the published averages. My salary blows the bell curves on salary for high school graduates. If you throw my salary in with all the rest of them and average the whole lot, you can see how the majority will make less that the "average".

Second, from my experience, the diploma only makes a big difference in salary for about the first two years (try and remember, I'm in IT, carreers don't last long in my business, your results may vary) after that, results matter. Hard work, determination, vision and ethics mean everything. You cannot possibly maintain all of these for any period of time unless you truely love what you do.

For me, that means I'll be re-loading a data warehouse with 25 billion rows of data (yeah, that's billion with a B) by hand tonight:)

ironpants wrote:For me, that means I'll be re-loading a data warehouse with 25 billion rows of data (yeah, that's billion with a B) by hand tonight:)

Heh... I have a picture in my head:

Ironpants sitting next to a pile of continous printer paper large enough to fill 4 dump trucks... staring at the green and white lines and attempting to read and re-enter what came out of his epson dot matrix printer.

Then I begin to giggle.

Wow, according to salary.com I'm in the lower 25%ile for my job description in this area. And I've been at it for almost 13 years. Too bad a raise ain't in my future.

Edit:
I checked again and specified my title better and looks like I'm a little better than average. I feel "slightly" better. Would still like that raise though

Friend Says: I see what your saying. Theres always those outliers or the select few who can radically change the mean and make it inaccurate. Anyways, just for educational purposes. What do people think about tax rates of 35%? I mean, I understand that the rich have the money to give, but they've also earned that money. But then again, without that money, we'd have a lot less revenue. Is it just a nessicary evil?

Keep in mind that not everyone pays 35%. The range is 10% to 35% based on gross income, see this site for more details.

Taxes (whatever your opinion on what they are used for), are considered necessary to finance the administration of any governmental unit. They pay for road upkeep, military defense, law enforcement, fire services, college grants, etc. If we got to keep our income, how many people would voluntarily donate money to keep up roads, pay the police, etc?

Friend Says: But do you think it's fair to discriminate against social status? I know a couple who live in Arizona where the wife works 90 hours a week. Just because they make more than my parents doesnt make me think that they should be taxed more. If anything, they are working harder, so why should the penalty be greater? Why not find one even rate for everyone? 35% just seems like so much. Those 90 hours worked equate down to 58.5 hours after taxes. 31.5 hours a week to taxes. Multiply that by 52 weeks and divide by 24 hours and thats 68.25 days of "free labor" to the government a year. Thats over 1/10th of your year thats getting taken away. 10 years later, the government took out a years worth of your labor. (Someone can check my math in case I screwed up.) Why not find a happy-medium for everybody? But at the
same time, people who are working less are also giving less which in proportion seems rational but not practical. Like I said, to me the equation seems to be equivalent to more work = more penalty. Why?