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Life

What Should My Kid Study?

Most people want their kids to succeed. But how? Of course, there’s the generic ‘work hard’, ‘study hard’ advice. But work hard at what?

I recently started attending open houses for high schools with one of my children. What stood out for me was how soon my child will need to make choices that will affect the rest of her life. Long gone are the days when you could coast aimlessly through high school. From day one, the entire experience is geared towards preparing kids for college, university or the workforce.

For example, to enter the ‘Media and Technology Arts’ stream, kids need to apply before starting high school. The application includes a questionnaire and mini-portfolio. At first, I was drawn in by the idea of learning practical skills at such a young age (they’d learn all the Adobe creative software). This stream would provide introductory training for someone pursuing a career in graphic design or video production. But then I got wondering: Does the stream lead students down a narrow path with few options? Does it actually provide students with highly marketable and flexible skills that last a lifetime?

The choices kids make at age 14 or 15 impact their lifelong career prospects. How would kids know what career they want at age 14? More importantly, how can you help your kids prepare to enter fields with bright long term career prospects? And how do you do this without unnecessarily narrowing the path by focusing on too specific an outcome?

A Function of Supply and Demand

One’s ability to succeed in a given field comes down to supply and demand. The lower the supply of workers relative to the demand for workers in a given field, the better the prospects for a rich, satisfying and meaningful career.

Anyone can learn to flip burgers in a couple of days – so there is a massive supply of potential burger flippers. That’s why burger flippers make minimum wage. (They’d make less if it were legal.)

The supply of workers in a given field is generally lower the more skill the field requires. However, sometimes even skilled fields are oversupplied with workers. These are usually the more ‘exciting’ fields like advertising, photography or the arts.

Now, the world needs artists so if your child is truly passionate and has artistic talent I wouldn’t dissuade him from exploring it to its fullest. But for every person making a successful living as an artist, there are hundreds more struggling to get noticed. Most artists will need to derive their primary income from a traditional 9-to-5. They might as well make that 9-to-5 as lucrative as possible, right? Moreover, you can (and probably should) develop art skills independently outside of any learning institution. Therefore, focusing on art in high school might be counterproductive.

Emphasize Broad, Marketable, In-Demand Skills

For the best career prospects, kids need to be guided towards fields with a mismatch between qualified workers and job openings. At the same time, it is important to keep the scope broad enough to allow for a variety of future – and likely unknown – paths.

In the business world, the skills mismatch is acute:

  • According to a survey done in the UK by Deloitte, only 18% of digital leaders in businesses feel that students are entering the workplace with the right digital skills and experience.
  • In a 2016 survey of The Business Roundtable, the association of U.S. CEOs, 59% of respondents struggled to find graduates with fundamental math skills. 75% couldn’t find STEM workers to fill roles ranging from cybersecurity to data analytics.
  • According to a recent study by the World Economic Forum, only 27% of small companies and 29% of large companies believe they have the right talent for digital transformation.

What you’ll notice is the de-emphasis on specific jobs. Instead, businesses need people with math, technology and digital skills. Those who possess these skills will be able to fit into a number of specific jobs and command high salaries. Indeed they will be treated well too, as companies can’t afford to lose people that are hard to find.

Of course, there is more to the world than just business – the public sector requires the same skills as the private sector.

Regardless of the industry or sector they end up in, it is clear that if high school kids invest their time in math, technology or sciences they will have a solid foundation that provides a multitude of options.

For example, someone with a math background could have a lucrative career in data science, statistical research, actuarial science, sales, accounting, finance, teaching and much more. The table below was created by PayScale in 2014 showing the 10 highest paying jobs in the US for people with math skills:

In contrast, a background in graphic design leads to…a job as a graphic designer. Possibly a great job, but a narrow path with little crossover into other roles and limited earnings potential. The median pay for a graphic designer today (according to PayScale) is $44,304.

So why would anyone nudge their 14 year old child down a path with few options and mediocre salary prospects? Instead, encourage them to study broad subject areas – like math, science and technology – with relatively few competitors and high employer demand.

Categories
Life

The Biggest Financial Decision of Your Life

There is a single business decision you will make in your life that could end up as the most important: marriage. Marriage can be a wealth creator or a wealth destroyer, so it is a decision that should not be taken lightly. 

A good marriage is one of support and compromise. Two people come together to work towards common goals, split the costs of living, generate multiple sources of income and build a sound foundation for a family. From this perspective, marriage can bear fruit that cannot be grown by one person alone. 

In contrast, when a marriage fails it can destroy the wealth of two people. Mel Gibson’s divorce from Robyn Moore Gibson cost about $425 million. Neil Diamond’s divorce from Marcia Murphey cost about $150 million. Steven Spielberg’s divorce from Amy Irving cost about $100 million. Of course, these examples are high-profile, patriarchal examples (in which the male pays the female a headline-grabbing sum of money) that don’t represent the average. In general, assets are split, the lower income earner turns to a meager lifestyle supported in part by the higher income earner, who loses a portion of his or her income. Divorce is economically survivable, but when compared to marriage it is a lose-lose proposition that can set the wealth creation goals for both parties back by decades. Compounding the economic effects, divorced couples lose the ability to divide tasks (such as household chores, parenting) in an optimal way to build wealth. Time is money – if they choose, a married couple can divide time to allocate to the most wealth-creating activities. A divorced couple simply doubles-up on tasks by performing them twice at separate households. It becomes a lot more difficult to pursue a great opportunity when you’re the only person who’s at home to cook dinner and help the kids with their homework. 

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Unfortunately, the significant economic decision to marry someone is often made by a brain raging with lust and irrationality. People tend to overlook faults and overestimate their ability to change someone when hormones are in charge. The marriage proposition – like any business decision – requires rational consideration. This means you need to separate the emotions out of one of the most emotional decisions of your life. That is not to say that you shouldn’t feel an emotional connection to your potential mate. Quite the opposite. There needs to be a strong emotional tie to make marriage work, but there also many practical considerations to make. 

So how should you evaluate a potential life mate? Here are just a few tough (aka very unromantic) questions you should ask yourself before getting married: 

  • Does my partner have a history of compromise? 
  • Do we tend to make big decisions together?
  • Do we have the same attitudes towards spending and saving?
  • What economic (income, assets or household management) benefits will my partner bring to the marriage?
  • How financially responsible is my partner’s family? Will we be supporting them?
  • Do our career ambitions clash?
  • What are my partner’s attitudes about fidelity?

Love is great. But you know what else is great? Being in love AND not being broke. Think very carefully before taking on the marriage project.

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Categories
Life

Gain Time by Exercising and Living Healthy

There is a limited amount of time in the day and you’re too busy building your career or business to go to the gym, right? Every minute you spend working out is a minute you could be coming up with the next big idea or working on your next presentation, right?

Wrong.

I’m about to virtually add time to your day and to your life.

Health and success are not mutually exclusive. Look around at some of the most successful people in the world: CEOs, entertainers, artists, and so on. A majority of them also take care of their health.

There are a few reasons for this. First, these people tend to be well-educated and therefore understand how important it is to eat well and exercise. Second, anyone who has achieved some level of success usually wants to be around long enough to enjoy it. The third reason, however, is the one missed by most. The final reason – perhaps the most important reason – these people live a healthy lifestyle is because it helps create their success.

Exercising helps prevent disease and keeps you trim, but, according to the Mayo Clinic, exercising also provides the following benefits (quotes taken from the Mayo Clinic website):

– It improves your mood: “Physical activity stimulates various brain chemicals that may leave you feeling happier and more relaxed. You may also feel better about your appearance and yourself when you exercise regularly, which can boost your confidence and improve your self-esteem.”

– Exercise boosts energy: “Exercise and physical activity deliver oxygen and nutrients to your tissues and help your cardiovascular system work more efficiently. And when your heart and lungs work more efficiently, you have more energy to go about your daily chores.”

Imagine starting your work day in a better mood with more energy. So by spending roughly 1.5-2.5hrs of your week at the gym you are able to gain hours of additional productivity every single day.

Remember, this isn’t just about work. This is about having energy for your entire life – work, kids, spouse, hobbies. So while your unfit colleagues trudge through the day like zombies, go home and collapse on the couch you can make the most of every waking hour. In a way, you’ve gained time in your day by making each minute more meaningful.