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Motivating high-school students to join college
My nephew and his friend are living with me since a few weeks, till
their parents return from an overseas trip, and both are teenagers who will be completing high school next year (May 08). Unfortunately, during the few weeks they stayed with me, I did not monitor them closely and the two boys have talked to people in my neighborhood, places where they were working part-time and got some ideas about not going to a college immediately after high-school is more profitable in the long run. The problem started as they talked to people in my neighborhood and were working in retail stores (like Target and JCPenney) as their parents had allowed them to work part-time during their stay with them. Somehow, the two boys have got the idea that it is far more lucrative to continue working full time after completing high-school, get a few years experience in a specific field, start their own business and become wealthy relatively faster as compared to someone who gets a college degree. They told me that they were going to discuss this matter with their parents. Obviously, their parents will dissuade them like me, but I don't want the parents to think I misguided the boys while they were with me. I am 26 years old, a recent graduate (having a B.S. + M.S in Computer Science), working for the state govt. and my gross salary is 32K and net is 25K in Tallahassee, FL. Both the teenagers were partly discouraged looking at my salary after a 6 year college degree. I explained to them as I liked to contribute my talents to the govt. sector where there is relatively less hustle, politics and need of producing short term gains as compared to corporate sector and hence took up a job with the State govt. In my area people who work for stores like Target, JC Penney people with high school diploma and 2-3 years of experience start with 50K(gross), people having their own business(credit union, bank, gas station, grocery store, real estate agent, landlord, hotel, restaurant owners, automobile stores, automobile parts and the varied number of shops we all see on the roads) are well in 300K - 500K in their middle twenties(24-27) and some more experienced folks are 1M(one million) or more. I was slightly skeptical, but the boys were told(by the folks who gave them this information) it is accurate as people in the corporate sector or having their own business typically earn lot more than people in the govt. sector or else most of them wouldn't be working there for the private sector or running their own business, which I could not deny. They were advised to start their own business and prosper rather than get a college degree and aid the State (or corporate sector) in generating revenue like me. They were informed in today's age of obtaining degrees on the Web, distance education classes practically anyone can get a degree when they truly require it (in 1-2 years or so) which so many Web only campuses provide. They were told going to college and spending 3-4 years while you can get it in 2 years when you actually require it seems a bit odd. One of my neighbor who just has an A.S. in Computer Science works as a contractor. He teaches classes to new employees of state in fields like Java,PL/SQL etc. and earns about 160K gross and 120K net. He gets about 5K income per week he teaches a class and sometimes about 7K. He is employed about 30-35 weeks per year out of the 52 weeks in a year. His net is 120K as he gets enormous tax breaks of running a business not to mention the funds he receives under the table(which seems unethical and how he does that is a mystery to me) which are tax free. His wife works for a State agency getting benefits(health/life insurance/investment) for the family. The husband is 24 and wife is 22(no college degree). Their household income is about 135K and only one member in their household has a 2 year college degree. He told the boys they could follow his path, as state agencies have some funds allocated for training and if one has good contacts with key people in the state agencies, their employment odds are high as the state agencies will hire them every year for teaching the same subject. If things don't work out, one can nearly always find a secure job with local, state or federal government, but at first one should take risks, if he wants to retire decently, buy a car, home, put his children through college and other myriad expenses incurred in raising a family. Another person in my area is an immigrant from another part of world. He immigrated at 55 to U.S. with no funds and aided by his relatives started a motel and became a millionaire at 65. I could not explain to the boys how someone with no college degree, comes to our country at 55 and becomes so prosperous in 10 years. Agreed, most businesses which pan out like his did are in that range, but I could not find a valid reason that so many people having college degrees and working for govt. or private sector are having financial issues in their fifties, but such business owners are remarkably flourishing. The immigrant secured loans from banks as his relatives were a collateral for him. His relatives also taught him the tricks of motel business(hike up the price during weekends, when there is a big function in City, getting tax breaks, dealings under the table by cash only deals etc.) His relatives were like that person except that they came while they were between the age group of 30-35. I realize people who have their own businesses are normally well off as compared to someone who work for private or govt. sector. Another immigrant living a few blocks from me is from India. He came through a visa program similar to this one explained at this link http://www.washingtonpost.com/wp-dyn...07/06/25/AR200... The link states how someone was running a company by bringing people to our country and gaining his commission from the companies that require such people. That immigrant (person X) came through the same means. He has a Bachelor's in Computer Engineering and he came on some work visa (H1-B). He worked for companies like Goldman Sachs, Ernst and Young and many other financial firms and 40% of his salary was withheld by the person who brought him as part of the deal for bringing him to the country. He after gaining permanent residency applied the same method. He would bring someone from India/China stating he wants to employ person 'A', thus applying for person A's H1- B visa. Person 'A' would work for a company like Goldman Sachs who would be billed for 80$/hr. Person A would obtain only 30$/hr with no benefits as 50$ will be his employer's (person X) charges. Thus, person X obtained a profit of about 25$/hr from one person A (after deducting business expenses of 25$/hr from the 80$/hour rate he was billing Goldman Sachs) or about 50K per person. He brought in 10 such people from India/China every year and is now a multi-millionaire at 32. He just has to advertise his employees properly and ensure there are projects for them all the year round just like any other consulting company. The H1-B visa was implemented to enable foreign workers who are actually skilled to be hired in U.S. rather than bringing someone who will pay a percentage of his wages to his employer and without any benefits. I explained to the boys it was like some admission official in a top college allowing unworthy students to get admitted(who actually did not deserve and did not meet the standards of the college) just because the students were allowing to grease the palms of the admission official. This keeps the truly talented students out of the college (and deprives them of their chances of growth) as well as degrades the quality of the college as a campus is judged by its students. Granted, he is impacting the U.S. company in a negative way, but that person was just worried about filling his pocket. The boys assured me they will not indulge in any such dishonest tactics (taking advantage of loopholes in immigration law) which would be detrimental to our country's economy in the short and long run. Another family in my neighborhood runs an internet site like http://www.mymoneyblog.com/ and generates revenue of about 300K per year from the advertisements on their site. The boys were attracted to this venture also as that household folks learned computers 4 years ago. Another person who worked for a while(3-4 years) at a bank after high- school, started his own credit union and became a multi-millionaire at 32. Another man became a millionaire after working for an expensive restaurant and then starting his own restaurant at 33. As the boys were working at the retail stores like Target and JC Penney, looking at the crowd which was purchasing expensive items daily, they thought that most people in our area are quite well off. Unfortunately, as I am in low income and hardly ever go to such malls, the boys concluded looking at me, starting your own business one can become far more financially independent compared to going to college and then working for someone. I attempted to explain that few people who shop in such malls go on unwanted spending (resulting in unnecessary debt) which is not a proper practice, but could not refute the fact that our country has the maximum billionaires or in other words people in our country are quite well off and hence can afford such spending. They talked to my landlord who owns about 100 apartments and hardly knows anything about house repair. On a repair call from a tenant, he sends his repair crew, still manages to pocket 1.5M after his expenses or taxes. That person is just 25, but he had the advantage that his grandfather purchased the property and paid the mortgage long ago, so this person just has to collect rent from people like me and lead a leisurely life. I wanted to explain to the boys that, though my landlord(without clearing middle school) has a seven figure salary working 10hours/week, instances like him are little rare. But, the boys were not fully convinced by my explanation as there are too many people in the real estate industry who are in the seven figure income in my area and possibly 8-9 figures in places like urban California and New York City. The boys thought despite of me having a six year degree I was not so well off financially, but people like my landlord were heavily prospering. I recognize it is tenants like me who contribute to my landlord's wealth at my expense. A fellow who has a construction business, earns about 500K per year at 26 without a college degree. He had to gain some licenses, but 500K seemed quite attractive to the youngsters at 26, though I believe such cases are uncommon. Couple of other folks who have pawn shops, gas stations, grocery stores, automobile shops, retail stores gave the boys same idea of working somewhere and then starting their own business to become a millionaire while in their twenties. All the people told the boys, starting your own business and on the first few years doing as much cash only transactions will aid them in evading lot of taxes and after then keeping two registers for transactions like one for IRS(evidently, which will be fabricated) and one which shows the actual dealings. Seraching the web viewing links such as http://www.careerprospects.org/Trend...sixfigure.html, discussions in stock/investment newsgroups as well as e-bay newsgroups made the youngsters believe 6 figure salaries is indeed very common in our country and if so many people with a high school diploma are obtaining it, it should be possible for them if they act wisely after high school. Apparently, they were informed that most people in the sports, media(TV/movie/radio industry) are well beyond the 6 figure salary. I understand few sports coach salaries are in seven figures, some movie/TV/radio stars and many others are well in the six figures, not all, but it tough convincing the young folks of risks (success rate of actors) present in such fields. Some have suggested the boys to gain some experience in credit card industry which is booming. The boys were informed Visa/Mastercard earn about 25% of each transaction as their transaction fees and removing the business expenses they earn a profit of about 10% per transaction. Organizations which provide Bill pay service to new banks earn interest by just moving funds around from the payer to payee, and earning funds in the interim period. As I don't have much knowledge about such services I could not refute statements stated by people who work in banking industry. That was one other area the boys were suggested to go into. The teenagers read a couple of books on the library which gave them some 101 top business ideas, but I clarified if the ideas actually worked, the author could be earning a mint himself before he published the book. http://www.google.com/services/local...ls/repfaq.html http://www.selladsense.com/ are few of the links where people can earn some funds which the boys were suggested to look into. I don't know how much of these programs work so could not advise the boys but told them to be careful. Another reason the teenagers had a bleak picture after college was the heavy outsourcing. Many fields are being outsourced and it is hard to obtain positions for college graduates. A typical fresh IT graduate would demand about 25-30K or more depending on the area, whereas someone in India/China with 7 years of experience would be willing to work for half of that salary. I told the boys, that is a fact in most aspects of life and we have to somehow adjust to it. I stated examples of how people with a college degree working for the State could start with 100K or more in my area (Tallahasee, FL) after graduation as explained below. I gave them an example of a hypothetical high school student who finishes high school at 17-18. And, today virtually all high school students take AP(Advanced Placement) classes while in high school itself which enables them to start as a sophomore(2nd year student in college) instead of a freshman(1st year student in college). There, they can save a year so they can get their bachelor's in 3 years instead of 4 years. Taking all the summer and winter classes their campus may offer (and today most colleges have winter or summer classes) they complete the workload of 3 years in 2 years. So, by the time they are 19 or 20 they have finished their Bachelor's. Then, with a year of experience of research at 20 or 21 about the Bachelor's thesis work they can go for Ph.D and finish in about 4 years which is 24 or 25. Then, they can start as a tenure track faculty or Assistant Professor. Where I live there is a university FSU(http://www.fsu.edu) where such faculties start with 80K for nine months. For three months of summer they get additional 27K. So, their yearly salary is 80+27 = 107K. Assuming a household in which both members (husband and wife) do this, the household income of such a family is 107*2 = 214K at the age group of 24-25 and that too working for the State Govt. (as FSU is a state university) and not suspectible to outsourcing, market factors as much as corporate sector, though the summer supplement may not be available if the economy is in a recession. This example is accurate if one has the doctrate in engineering fields, management, nursing, law etc. For other fields, I don't know the starting salary at FSU. Most lawyers, optometrists, nuclear, chemical, petroleum engineer, MBA graduates from top 15 B-schools start with 100K or quite close after graduation in the area where I live. I encouraged the boys to be like the professionals I stated. I recognize the final choice can be made only by the parents and children, but I wanted them to get a college education which would help them understand things better in life and work place. Granted, like most aspects in life the higher the risk, more is the reward. And, starting one's own business brings its own rewards which is the reason most people commence their own business or continue their family business and indeed prosper. But, I feel the boys could approach that issue after a Bachelor's degree and that time is not wasted if they actually learn something in a college. Finally, I did not intend to disparage anyone (immigrant examples), FSU faculty salaries might be little low or high(I got the number from a friend) or the numerous examples( commission charged by Visa/ Mastercard, people in different fields). I understand different people have different talents and they pursue them. A person having athletic or acting ability can be a sportstar or in the media industry and it is completely fine, but I did not want the boys to choose a path solely based on the financial rewards. The salaries of people like my landlord, people in my neighbourhood, restaurant owners etc. were obtained from the folks themselves by the teenagers(so might be a little high/low) and may have a slight variance depending on the market. I realize the issue I am facing is not new and people in this group who are far more knowledgeable can guide me in encouraging the teenagers to pursue college. I would appreciate any advice. Thanks a lot. |
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Motivating high-school students to join college
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