Career and money advice for new college graduates

If you’re a millennial, do these things, or else risk remaining unemployed for a long time.

1. Wake up early. Job seeking is a full-time job.
2. Don’t pass on everything. No entry-level job is ideal.
3. Stop relying on mom and dad.

Career advice from Aol Jobs, summarized by FINS Morning Coffee

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With two out of three college graduates averaging more than $24,000 in student loans, Fox Business steps in with this financial advice.

Step 1: Create a Budget

Even if grads don’t have a concrete post-grad plan just yet, creating a budget of projected expenses such as bills, rent and discretionary spending can help them better understand their cash flow situation, suggests John Bucsek, managing director with MetLife Solutions Group. …

Making a budget doesn’t have to be an overwhelming prospect—grads can easily keep up with their expenses using sites like Mint.com or creating a simple spreadsheet….

Step 2: Figure Out Student Loan Terms

Grads typically only have a six-month grace period before having to start repaying student loans, making it essential to secure a job and stay on top of other expenses.

Unemployed or financially-strapped grads should consult with their lender to determine repayment options available to them such as deferment, forbearance, and Income Based Repayment plans should they have issues making payments on time….

Step 3: Get High Interest Debt in Check

Whether grads are an authorized or co-signed user on a parent’s card or have their own account, they should  focus on getting the debt with the highest interest rate paid down first.

Understanding how debt impacts future goals and how credit score plays into every major purchase can help them stay on top of making steady payments and monitoring credit history health, says Bucsek.

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A variation on the expert’s advice

Since the percentage of young adults living with their parents has risen to 22% today, from 11% in 1980, it appears the recommendation to “stop relying on mom and dad” is being ignored by many.  Here’s my variation on the preceding advice.

1. Get up early every day to find a job, or to hone your skills to make yourself more employable.
2. Even if you can’t find a job in your field, work somewhere, even if it’s part-time.  Earn some money.
3. If you’re living at home, use the opportunity to save aggressively and/or pay down student loans.

 Related:  Parents have lower expectations for kids becoming financially independent (Cost of College)

Lack of college-educated men may be a reason for declining marriage numbers

The lack of college-educated men may signal more problems for the future of marriage.

The importance of marriage is on the rise among women while decreasing among men.

 … According to Pew Research Center, the share of women ages eighteen to thirty-four that say having a successful marriage is one of the most important things in their lives rose nine percentage points since 1997 – from 28 percent to 37 percent. For men, the opposite occurred. The share voicing this opinion dropped, from 35 percent to 29 percent.

Gender imbalance may be creating an obstacle to marriage for college-educated women.

… Across the United States today, young women are much more likely to graduate from college than their male peers, a trend that’s been compounding itself for a few decades now. And because college graduates overwhelmingly tend to date other college graduates, that’s created an enormous imbalance in the national dating pool. In Portland, the situation is particularly dire. According to the Census Bureau’s American Community Survey, there are 33 percent more women in Portland who are under the age of 35 and have at least a bachelor’s degree in than there are men. That’s on par with New York, which is notorious for its lopsided gender ratio.  

Marriage is on the decline, and the lack of college-educated men suggests a continuation of this trend for highly educated women, a group that has been most resistant to the trend so far.

Where to find college-educated men
Recently I was at local watering hole on one of their ladies’ nights, a practice I mistakenly thought had been ruled illegal.  By the looks of the crowd, I would say that young women looking for college-educated men of marrying age might want to check this place out.  Promoting itself as “definitely worth the 30 minute train ride from” New York City, this establishment might be especially attractive to NYC women who are experiencing the effects of that city’s gender imbalance.  But considering the long-term trend, I wonder if we’ll soon be seeing “men’s nights” at these types of places.

Related:

• College-educated women marry at higher rates (Cost of College)
• College Graduation Score: Women 30%, Men 22% (businessweek.com)
• The Worst Cities for College-Educated Women Trying to Find a Decent Date (The Atlantic)

Telecommuting does not work for Yahoo according to Marissa Mayer

Skimming through the recent buzz arising from Yahoo’s CEO Marissa Mayer’s decision to ban telecommuting for all employees, Penelope Trunk’s perspective seemed one of the most sensible.

Mayer is more honest than everyone else. The workforce divides into two sides: people who try very hard to decrease the conflict in their life between work and home, and people who try very hard to get to the top of the work world. You can’t do both. You know that, you just don’t like that Mayer is institutionalizing it.

There are valid reasons for requiring face-to-face interaction.

The Harvard Business Review combines easily-found data to show that innovation happens faster if people work at the same office, and company culture is easier to control and more energizing if people share physical space. Also face-time is linked to higher performance, which is linked to the idea of propinquity, the word to describe why people work better if they are in the same room. If you are near someone, you get along with them better. It’s how human beings work—it’s part of our social DNA that goes back millions of years. We understand each other if we see each other, which makes sense since we read so many nonverbal cues.  So people who are physically together are more efficient, more productive, and more innovative than people who are not physically together.

This is the type of data Mayer is relying on to justify her demand that people work at the office. Sure, there is data that individual workers are more productive if you let them handle their personal life with flexible work. But there is also evidence that top firms don’t need to accommodate those people. In Silicon Valley, home to Facebook, Google, Airbnb,none of most desirable companies make room for a personal life. They don’t have to. They have plenty of people hoping to give up their whole life to the company.

I’m familiar with workplaces where more men than women are willing “to give up their whole life to the company”, having worked at one such place.  These types of employers typically do not have many women in the top spots.

It didn’t work for me.

When I had a part-time telecommuting arrangement for a while, I fooled myself into thinking it would not significantly hurt my career growth.  I should have known that as one of the very few employees able to work from home, I was doomed, as this comment from 11D explains.

The worst arrangements are ones in which on-site work is the norm, but a small minority are frequently/continually remote. In those situations, there’s little incentive for the on-site workers to fight with Adobe Connect or Campfire or whatever teleconferencing tools will allow the remote members to be involved in the work — an involvement that will still be hindered by the asymmetries of not being in the room. The easiest option is for everyone else to assign the remote member something unimportant to the team’s success and then ignore them. (I should point out that in these cases, the manager is rarely remote.)

I was a manager, and I remember dreading this type of subtle warning sign that my flextime days were over.

… You get an email from a coworker that starts with ‘X was looking for you, but I helped them…’

Even though Mayer wants women to succeed in business, she will no longer let them work from home.  With a bit of hyperbole, Trunk explains why.

Telecommuting is for people who don’t want to give up everything for their company. Mayer doesn’t want to work with people like that.

Face the facts.

Women graduate college at a higher rate than men and women earn more money than men. Until there are kids. Then women slow down.  By choice. Women tend to start slowing down at work around age 28  in order to be done having kids by the time they are 35. Generation Y women are well aware of this, and the pattern is so ubiquitous that business schools unofficially let women in earlier than men because women need to finish working at full-capacity so early in their career.

Which means the top performers at work are mostly men. But it’s not a gender thing, it’s a time thing. That’s what Marissa Mayer is saying: don’t think about coming to my company unless you’ll give everything for your job.

While we can’t “have it all”, we have many more choices today.

If you want to parent—really be there for your kids—then you need an alternative career track. You can telecommute, you can work part-time, you can freelance, you just can’t work with people who don’t need those same accommodations.

So today, people have choices, people have more control over their lives than ever, and people have good information to make intelligent decisions. Mayer is forcing you to make hard decisions. You don’t like that. But don’t blame her.

Did Mayer start a trend?  Best Buy ends work-from-home program (CNN Money)

Related:

• Marissa Mayer Is Right: Why Your Company Needs You In The Office (lifehacker.com.au)
• Marissa Mayer’s Job Is To Be CEO – Not To Make Life Easier For Working Moms (businessinsider.com)

Quick Links – more homeless young adults; reports on trends in college financial aid

◊◊◊  Growing number of homeless young people is tied to high unemployment rate.

Across the country, tens of thousands of underemployed and jobless young people, many with college credits or work histories, are struggling to house themselves in the wake of the recession, which has left workers between the ages of 18 and 24 with the highest unemployment rate of all adults.

Exact numbers are hard to come by, but some cities have tried to measure the trend.

Boston also attempted counts in 2010 and 2011. The homeless young adult population seeking shelter grew 3 percentage points to 12 percent of the 6,000 homeless people served over that period.

In some cases, a reluctance to move in with parents seems to be the reason for living on the street.  One homeless shelter director describes this group as “high functioning but who’ve been unable to stay on their feet” and “not been able to launch themselves into a successful young adulthood”.

After Recession, More Young Adults Are Living on Street (The New York Times)

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◊◊◊  Trends in Student Aid 2012 – College Board

Trends in Student Aid, an annual College Board publication since 1983, is a compendium of detailed, up-to-date information on the funding that is available to help students pay for college. This report documents grant aid from federal and state governments, colleges and universities, employers, and other private sources, as well as loans, tax benefits, and Federal Work-Study Assistance. It examines changes in funding levels over time, reports on the distribution of aid across students with different incomes and attending different types of institutions, and tracks the debt students incur as they pursue the educational opportunities that can increase their earnings, open doors to new experiences, and improve their ability to adapt to an ever-changing society.

Selected Highlights

• In 2011-12, undergraduate students received an average of $13,218 per full-time equivalent (FTE) student in financial aid, including $6,932 in grant aid from all sources, and $5,056 in federal loans.
• Federal grant aid almost tripled in constant dollars between 2001-02 and 2011-12, increasing from 20% to 26% of the total 185.1 billion in undergraduate aid.
• Only 2% of students who first enrolled in 2003-04 had borrowed more than $50,000 from federal and nonfederal sources combined by 2009. Over 40% did not borrow and another 25% borrowed $10,000 or less.

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◊◊◊  Merit Aid for Undergraduates: Trends from 1995–96 to 2007–08 (National Center for Education Statistics)

This Statistics in Brief uses nationally representative data from 1995–96, 1999–2000, 2003–04 and 2007–08 to examine trends in merit aid to undergraduates by student and institutional characteristics and in comparison to need-based grant aid.

‘What Families Can Do When a Child May Have a Mental Illness’

From the National Alliance on Mental Illness (NAMI):

If you are worried about your child’s mental health, follow your instincts. Unexplained changes in a child’s behavior and/or mood may be the early warning signs of a mental health condition and should never be ignored.

There are many different types of mental illness, and it isn’t easy to simplify the range of challenges children face. One way to begin to get a handle on this question is to get an evaluation of your child or teen by a licensed mental health professional.  Because all children and youth are unique and the local mental health services, insurance coverage and school services vary a great deal from community to community, it is a challenge to find the right kind of help for your child.

Like many others, my family has had to deal with this issue.  You can read more about different types of mental illness and what steps parents can take to help their children at the NAMI website.

Have a joyful and peaceful Christmas.

 

Related:

• Parents Worry Their Child Could Be ‘Next Adam Lanza’ (CBS Detroit)
• ‘Every 20-something I know is in therapy for something’ (Cost of College)

’84% of working women want to stay home with kids’

According to a new partnered survey cosponsored by ForbesWoman andTheBump.com, a growing number of women see staying home to raise children (while a partner provides financial support) to be the ideal circumstances of motherhood.  Forget the corporate climb; these young mothers have another definition of success: setting work aside to stay home with the kids….

… according to our survey, 84% of working women told ForbesWoman and TheBump that staying home to raise children is a financial luxury they aspire to.

What’s more, more than one in three resent their partner for not earning enough to make that dream a reality.
Is ‘Opting Out’ The New American Dream For Working Women? (Forbes)

But a high standard of living is more important than staying home.

As one (working) mom of two told me, she may dream of leaving work to take care of her kids, but the (financial) reality of it is not so ideal. “Sure, if my husband made so much money that I could spend time with the kids, still afford great vacations and maybe the occasional baby sitter to take a class or go out with friends, I’d be the first to sign up,” she said. “So maybe while it’s a luxury I do think about, it’s not one I would want unless it was actually luxurious. I don’t want to be a stay at home mom who clips coupons or plans her weekly menu to make ends meet… If that’s the case, I’d gladly go on working to avoid that fate.”

This leads me to wonder if many men also aspire to stay home with the kids.  I doubt it, but maybe part of the reason is because they have lower expectations of what their wives could earn.  Or maybe there are other reasons.

Only about 20% of SAHMs think they’d be happier working outside the home.

Other highlights:

Very few SAHMs are sorry they left the workplace, but I’m intrigued by the odd way Forbes chose to relay this politically incorrect data.  I may be reading too much into it, but when every other percentage in their story is given as an exact number, there seems to be an attempt to inflate this measure.

More than 10% of stay-at-home moms regret giving up their career.

Their wish to be home with their children may be affecting productivity, especially since a happy worker is a productive worker.

Approximately half of working moms agree their overall happiness would increase if they didn’t work. More than a third (34%) of working moms admit that their work performance was slacking a bit and they wished they were home with baby after returning to work. In fact, 47% agree that their overall happiness would increase if they weren’t working. On the other hand, only nearly one in five (19%) of stay-at-home moms admit their overall happiness would increase if they worked outside the home.

Penelope Trunk, the Brazen Careerist, advises women:

Pick your spouse carefully. 
If you want to stay home with kids, don’t marry a guy who can’t earn a living. If you want to stay home with kids, make it clear that even though you earn more than the guy, the guy will be the breadwinner. If you want to stay home with kids then you put all your financial hopes in the guy’s career. Whatever his earning ability is, then that is your earning ability, because you are a team, and he is the breadwinner.

With the declining “supply” of men who are college-educated, our daughters may find it difficult to follow this advice.  My advice would be to first make sure you can support yourself before you go looking for that male breadwinner.

HT Ann Althouse

Related:

• Trouble for some marriages where wives earn more than husbands (Cost of College)
• Bias Persists for Women of Science, a Study Finds (NY Times)

Quick Takes – States are graded on public education; college students voting in November

—  The Center for Education Reform has an interactive map of the United States that “shows how the states are doing in providing the critical policy ingredients necessary for effective schools to serve all children”.

The CER supports charter schools, school choice, and performance pay.

…  Each state has been given a grade for each of several components, and those grades collectively factor into an overall grade and general education weather forecast for that state. As states adopt new policies and programs, the grades may change.

The overall grades are based on these components:
–  Governors
–  Media Reliability
–  Charter School Law
–  Teacher Quality
–  Digital Learning (Coming Soon)
–  Parent Power Index (Coming Soon)

In New York, the “forecast is cloudy”with the following grades:
–  Governors:  F
–  Media Reliability:  C+
–  Charter School Law:  B
–  Teacher Quality:  C
…

—  Will college students show up for this presidential election?

The question has ramifications for college campuses around the country in the two months that remain before Election Day: this year, will young people — especially college students, a group that backed Obama overwhelmingly in 2008 — show up?

Has enthusiasm for Obama among college students waned?

Della Volpe, who has polled young voters 22 times since 2000, said that Democrats shouldn’t count on college students to support them in such large numbers this year. Republicans have worked hard to win over disaffected 2008 Obama voters who, since graduating college, have struggled to find jobs and repay student loans. (Representative Paul Ryan, the Republican candidate for the vice presidency, made the pitch in one of the most memorable lines of his convention speech last week: “College graduates should not have to live out their 20s in their childhood bedrooms, staring up at fading Obama posters and wondering when they can move out and get going with life.”)

But Della Volpe said his polling data suggest that Obama’s college student base from 2008, voters now in their early to mid-20s, still support him. It’s the younger voters — college students too young to vote the last time around — who should concern Democrats.

“It’s a myth that people turn 18 and automatically become Democrats,” Della Volpe said. In Wisconsin, Obama dominated among voters aged 18 to 24 in 2008. But last fall, in the election to recall Republican Governor Scott Walker, the governor won 18- to 24-year-olds by 3 points, helping him retain his post.

One college student I know tells me that while young people still overwhelmingly support Obama, their diminished fervor for his presidency may cause fewer of them to show up at the voting booth in November.

Here’s the “faded Obama poster” video.

Grandma’s Social Security check increasingly at risk from unpaid student loans

It’s no secret that falling behind on student loan payments can squash a borrower’s hopes of building savings, buying a home or even finding work. Now, thousands of retirees are learning that defaulting on student-debt can threaten something that used to be untouchable: their Social Security benefits.

… From January through August 6, the government reduced the size of roughly 115,000 retirees’ Social Security checks on those grounds. That’s nearly double the pace of the department’s enforcement in 2011; it’s up from around 60,000 cases in all of 2007 and just 6 cases in 2000.

The amount that the government withholds varies widely, though it runs up to 15%. Assuming the average monthly Social Security benefit for a retired worker of $1,234, that could mean a monthly haircut of almost $190. “This is going to catch an awful lot of people off guard and wreak havoc on their financial lives,” says Sheryl Garrett, a financial planner in Eureka Springs, Ark.

Most of these loans in default were for children or grandchildren.

Many of these retirees aren’t even in hock for their own educations. Consumer advocates say that in the majority of the cases they’ve seen, the borrowers went into debt later in life to help defray education costs for their children or other dependents….

A “unique” new problem

Roughly 2.2 million student-loan debtors were 60 and older during the first quarter of 2012, and nearly 10% of their loans were 90 days or more past due, up from 6% during the first quarter of 2005, according to the Federal Reserve Bank of New York. “It’s really a unique problem we haven’t had to face before, and it’s only going to grow,” says Robert Applebaum, founder of Student Debt Crisis, a nonprofit advocacy group in Staten Island, N.Y.

Student debt obligations are piling on to the existing problem of inadequate retirement savings.

The threat of Social Security cuts adds to the overall financial woes faced by the aging baby boomer generation. Almost 45% of people aged 48 to 64 won’t save enough money to cover basic needs and uninsured health care costs in retirement, according to the Employee Benefit Research Institute. Experts say reducing Social Security benefits could set them back even more.

You can extend your student loan payment period up to 38 years – longer than most mortgages.

Student-loan experts say that changes in payment plans are partly to blame for why an aging population is still dealing with college loans. The repayment period on federal student loans can be extended to 30 years, Kantrowitz notes, if borrowers owe $60,000 or more. Another eight years can be added on for borrowers facing unemployment or other economic hardship; during those years, payments aren’t required but interest accrues.

The trend is not good.

Compared to present-day retirees, younger generations are in deeper debt, which means stories of Social Security garnishment could become more commonplace when they enter retirement. Borrowers in their 20s and 30s owe roughly $600 billion, according to the New York Fed. They’re also leaving college with more debt than their predecessors: Sixty-six percent graduated this spring with debt, and their student loans averaging $28,720, up from $9,320 in 1993, according to FinAid.org. “It’s entirely possible that the way student loan debt is growing, this could get worse,” says Rich Williams, higher education advocate at the U.S. Public Interest Research Group, a nonprofit consumer group.

Related article:  Bernanke: $1 trillion in student loans won’t cause crisis (kansascity.com)

Better financial payoff for women who become PAs instead doctors

The average female primary-care physician would have been financially better off becoming a physician assistant.

When a net-present-value (NPV) calculation was applied to cases where women chose to become physician assistants (PA) and compared to those who chose to become primary-care doctors, the average economic outcome was found to be superior for those who chose the PA career path.  The upfront costs, deferred earnings during training, hourly earnings, and lower PA salaries are all factors in this equation.  One factor that appears to make the biggest difference in outcomes for women is the lower number of hours they work compared to men.

… Male doctor earns more per hour relative to the male PA than the female doctor earns relative to the female PA. However, a big part of the difference comes from an hours gap. The vast majority of male doctors under the age of 55 work substantially more than the standard 40 hour work week. In contrast, most female doctors work between 2 to 10 hours fewer than this per week.

Even though both male and female doctors both earn higher wages than their PA counterparts, most female doctors don’t work enough hours at those wages to financially justify the costs of becoming a doctor.

The medical profession is one that lends itself to women (or men) scaling down to part-time schedule, an option preferred by most working mothers.  So it is should not be surprising that women doctors rarely drop out of the work force.

… there is evidence that women doctors actually “drop out” less frequently than women lawyers and (especially) women MBAs. For example, a 2010 study by Herr and Wolfram find that in a sample of Harvard graduates, 94 percent of mothers with MDs remain working in their late 30s, compared to only 79 percent of JDs and 72 percent of MBAs. One of the attractive features of primary care medicine is the possibility to scale up or scale down the workload — flexibility often not feasible for an executive or investment banker. If one scales down enough, though, the upfront investment of becoming a doctor isn’t recouped.

The fact that most female doctors work “between 2 to 10 hours fewer” than a standard 40-hour work week in contrast to male doctors who work substantially more hours helps explain why many female doctors I’ve encountered tend to keep shorter office hours and are less available after hours.

… in 1976 women constituted only 24 percent of first year medical students. By 2006, that number which doubled to 48 percent.

The rising trend in female doctors who will continue to work fewer hours may exacerbate the shortage of doctors, which is expected to worsen as the result of demographic changes and the implementation of Obamacare.

Considering these trends, what are some possible future scenarios?

1. Women doctors will begin to work longer hours as more fathers take on the role of primary child care.
2. Fewer women will choose medical school and instead opt for the PA career route.
3. More of our medical care will be handled by PAs instead of doctors.
4. All of the above

Some background on the PA profession

… Physician assistants (PAs) are medical professionals who diagnose and treat illness under the supervision of a physician and who may, in all 50 states and the District of Columbia, write prescriptions. The first PA program started in 1965 at Duke University, and was initially designed to provide civilian medical training to field medics returning from Vietnam.

Interestingly, while the PA field started out all male, the majority of graduates today are female. The PA training program is generally 2 years, shorter than that for doctors. Unsurprisingly, subsequent hourly earnings of PAs are lower than subsequent hourly earnings of doctors.

The 2010 median pay for PAs was $86,410 per year.  It might not be a bad career choice for either men or women.

Quick Takes — the purpose of college, affluent public schools are not so great, ‘fracket’ definition, & more

—  From Bill Henderson at The Legal Whiteboard, a description of what a college education should  produce 

…  a critical thinker who can reliably communicate, collaborate, gather facts, assess data, lead, follow, and approach problems with both empathy and objectivity.

It doesn’t seem that it should be that complicated or expensive.

—  Few affluent U.S. districts are world class (Joanne Jacobs)

This is from 2011.

America’s elite suburban districts rarely provide a world-class education, concludes When the Best is Mediocre, a study by Jay Greene and Josh McGee in Education Next. Their Global Report Card compares math and reading between 2004 and 2007 for most U.S. public school districts with the average in 25 developed countries that are “economic peers and sometime competitors.”

Well-to-do and politically connected families believe they’ve escaped mediocre schools by moving to affluent suburban districts, Greene and McGee write. But their children won’t be competing with inner-city students, when they grow up. In a global economy, they’ll be competing for top jobs with  top students from around the world.

In wealthy, white-and-Asian Beverly Hills, students score in the 76th percentile in math compared to other California students, but only in the 53rd percentile on the Global Report Card.

• When the Best is Mediocre (EducationNext)
• Wealthy Suburban Schools: Only Mediocre by International Standards (CollegeConfidential)
• Reporting on the Global Report Card (Jay P. Greene’s Blog)
• Meet the Suburban Parents (The American Spectator)
• Understanding the upper-middle-class (Flypaper)

—  The more educated you are, the less time you spend on leisure activities.  It’s true for both men and women.

 … Men with at least some college chip in more on child care, shopping, and other chores, and are more engaged in civic and religious activities. They spend a little less time caring for other adults or repairing their houses and cars.   How the 2 Americas Spend Their Time (The Atlantic)

— ‘ Fracket ‘

One of those things parents don’t want to think about too much when their children go off to college.  Here’s a definition of fracket from the Urban Dictionary:

a jacket you wear to frats because you don’t mind if at the end of the night, it is covered in beer, frat sludge, or other unidentifiable liquids. Also, it is not a big deal if this jacket is lost during or stolen during the course of the night.

Person 1: Ah, I made the mistake of bringing my J.Crew pea coat out last night and now its covered in beer!
Person 2: You should have brought your fracket instead!