Friday, July 23, 2010

In Pursuit of the Six Figure Salary

I am a child of immigrants, as were many of my friends.  We were middle class, in an affluent community.  My parents, along with most of my friends' parents, were immigrants and suffered and sacrificed to make sure that they bought homes in the right neighborhoods and sent their kids to college to pursue the American dream.  Our parents made sacrifices to provide us with the proper foundation to live a good life in this country.  They didn't think it would be nearly as hard for us.  After all, we were born here.  We were schooled here.  The world was our oyster.

When I was twelve, my girl friend and I were sitting around discussing our futures.  Yes, we were very serious children.  We both figured that we would be fine if we earned (with our husbands Prince Charming and James Bond) $100K+.  We thought we'd be comfortable.  We were smart and good in school, it should be attainable.  Hell, we ought to be able to earn $100K on our owns.

Well, I did earn $100K+ at some point.  And I'll tell you how I felt.  I didn't feel rich.  For the first time in my life, I felt comfortable.  I could save and I could spend. I always had money in the bank. I could buy every Gucci purse I desired, but I didn't need to.  I felt squarely middle class (remember that I live in New York City).

So, those days are over and I've plummeted to the lower five figures.  I am not sure yet, but I imagine I will earn $35K or $40K this year--if I'm lucky.  But I least I felt the luxury of the six figure salary at some point in my life.

On a weekly basis, I encounter at least 1 or 2 0Ls that I attempt to dissuade from attending law school.  I'm usually successful too.  How do I do it?  I focus on the bottom line: you will (most likely) not earn a $100K, or even close--when you graduate.  In fact, in all likelihood, you'll earn exactly what you earn now--or less.  I am very good with people and I'm very convincing. I tend to focus on this issue because I can see through all the bullshit about life long dreams of law school and the intellectual challenge and see that the 0L is simply not satisfied by the salaries offered to college graduates.  Most of these 0Ls have careers.  They are medical billers and park rangers and paralegals, and their salaries don't feel like enough.  I don't doubt that.  In their minds, they are intelligent people--why shouldn't they feel comfortable?  Why should they live paycheck to paycheck?  Law school is simply a way to boost your resume so that you earn more money, right? It's logical, right?

Well, BIDER readers know that a JD is the new BA.  Your salary won't jump up.  You may graduate from law school and land a job earning $40K, but you're $150K in debt and you're even worse off.  That's the cold, hard truth.

Salaries have been stagnant. We're earning what our parents earned 20 years ago, but life is infinitely more expensive.  There's no magic formula that will give you the lifestyle and salary that you (think you) deserve.  An education is certainly not the way to make large strides in your net worth.  It seems that there is no way to break the cycle of poverty (and trust me that you're poor if you're living from paycheck to paycheck)--outside of owning a company or inheriting wealth.  And our generation is not satisfied with being poor.  In a way, that's what caused the financial collapse of 2008.

I ran into this passage about the book Saving Capitalism from the Capitalists (by Raghuram Rajan) which explains my point exactly:
In a new book he is working on, entitled “Fault Lines,” Rajan argues that the initial causes of the breakdown were stagnant wages and rising inequality. With the purchasing power of many middle-class households lagging behind the cost of living, there was an urgent demand for credit. The financial industry, with encouragement from the government, responded by supplying home-equity loans, subprime mortgages, and auto loans. (Notwithstanding the government’s involvement, this is ultimately a traditional Chicago argument: in response to changing economic circumstances, the free market provided financial products that people wanted.) The side effects of unrestrained credit growth turned out to be devastating-a possibility that most economists had failed to consider.
We have always been a nation of consumers.  Now we're a nation of consumers with no money.  We're fastly becoming a third world nation, where there are only rich and poor people.  What rich people don't realize is that you can't live like a king among paupers without worrying about the paupers killing you and kidnapping your children for ransom.  That will be fun.


  1. Doug, your thoughts?

  2. You can still live like a king so long as you don't act like an insufferable lout and exhibit the lifestyle of a rich spoiled brat. There are those who made a wads of money but:
    a. did not blow it on a condo/house near the height of the RE market (2004-2007),
    b. did not blow it on a new car every year,
    c. did not blow it on consumer items bought to impress others.

    Yes, there are those who are sitting on a king's ransom in savings and they are living it high on the hog now. Here's to those not afflicted with affluenza.

  3. I predict that in a few years you'll be making your 100k.

  4. The thing I hated about school was that everybody always thought they'd make 6 figures or do really well in whatever. Academia creates this type of thinking in the young and indoctrinates them into valuing education and looking down on everybody else, even if they have to use delusion to do it.

    In reality, a $60k job is a very good one, especially in your mid to late 20s, also depending on where you live in the country. About 2% of the population make 6 figures or more. It's just so idiotic to act like everyone in school is in that percentage and that 98% of the world is full of losers that these people that have never done anything in their lives are better than.

    I wish i could tear apart all of academia and just get rid of it. It's disgusting.

  5. Thanks David, for the vote of confidence. Hoping for the best, but not holding my breath. I would be happy with $60K. I will never be able to retire, but that's okay. I smoke and plan on dying early.

  6. Thank you for your blog. I know it's sick and twisted but it's nice to know that my husband and I aren't alone in our current predicament. We worked at very comfortable jobs before making a mutual decision that we would move out of state for him to go to law school.

    The goal was never to attain a 6 figure salary but rather to work for the government. Little did we know that those jobs are as hard to come by as firm positions. (It would have been nice if my father-in-law who has been a government attorney for decades had mentioned something)

    Anyways, once my husband graduated, we decided to stay in our current location instead of moving back because I had a decent job and there was no sense in us both looking for work with student loans bearing down on us.

    Now a few years removed from law school and my husband is not only not working in the legal field but he's in a position that is lower in status and pay than he had before law school. I actually make more than he does with my useless BA. Needless to say I'm bitter. Everyday I ask myself why we couldn't have just been happy with what we had.

  7. Oooohhhh, chicks that smoke are hot!

  8. "Little did we know that those jobs are as hard to come by as firm positions."

    So, like most of the whiners and scambloggers, you didn't do any research - you just assumed the jobs were plentiful and hubby could land one easily. Not too bright, eh?

    "(It would have been nice if my father-in-law who has been a government attorney for decades had mentioned something)"

    If he's been one for "decades," he probably has no idea what the job market is like for new grads. Did you ask him to help get an informational interview at his agency so you could ask someone knowledgeable about the job market? No? Then don't blame your stupidity on him.

  9. Spengler's Shop RatJuly 24, 2010 at 12:21 AM

    The jobs aren't there, folks. 'Informational interviews', 'networking' - it's all utter shit. Having worked for a small business I can attest that people are routinely hired (and rejected) for the most trivial and unpredictable reasons. Ever notice how all that pretty symmetrical formatting on your resume only became necessary in the last ten years or so? Did anyone worry about their bullet points and tab stops in the 1990s? The 1980s? The 1960s? Hiring managers don't really worry about it now. They just want a readable document - and that's not difficult to produce. Meanwhile, the self-titled 'career experts' make a living telling us how to use bold and italic, and whether or not we should spell 'resume' with the accent mark.

    The only 'entry-level' positions left are in low-wage service jobs, sales, and specific healthcare and engineering positions. And even those aren't necessarily easy to get. Experienced candidates are so cheap and easy to find right now that there are no positions available for truly 'entry-level' personnel. The jobs aren't there.

    Don't rely on your parents or older coworkers for advice, either. They think the old rules still apply. They're clueless.

  10. "'Informational interviews', 'networking' - it's all utter shit."

    An informational interview with someone who tells you "Two years ago, we hired 50 grads; this year we're hiring five, and most of the firms and agencies around here have seen the same drops" - that's not shit. That's a major red flag and exactly the kind of information that the scambloggers all claim was not available to them but should have been. If you have an inside track to talk to someone who knows about the hiring in a firm or gov't agency and you follow up BEFORE you skip off to law school, you might just change your plans.

  11. Whenever I do research on career paths I assume I will make 20% less than the low end of the pay scale. This helped me when I chose my law school. Things worked out great and I am now debt free. I guess my business degree helped a lot.

    However, I would have made a lot more had I just gone into the work force instead of law school. Heck, my buddies in the military aviation community make mad bank (flight pay and housing allowances are insane) and get to do interesting stuff. Although, I am sure Obama will kill this golden goose before he is invited to leave office.

  12. @Angel - quit smoking... Nothing worse than a unemployed lawyer, no medical insurance, Sallae Mae breathing down your neck beacuse you defaulted to undergo chemo after a major heart attack.. and thats the good news. Bad News is Aunt Sallae just called your employer to up the garnishment so beans are out for the weeks groceries.

  13. Dear Prick at 11.27 pm:

    How is life in your parents' basement? If you're such a success, you imbecile, you would have no time to troll these blog pages, then, would you? Do you think Bill Gates or Steve Jobs has THE TIME to express joy at others' misfortunes?

  14. I don't fault your dad in law, either. I've spoken to older people who are attorneys for the govt. and the deepest thought they've produced on the job market is "We certainly hire more people from T14 than we used too." Which translates into, the govt. has become extremely competitive. I'm not sure an informational interview would reveal that.... you just have to keep your eyes and ears open and figure it out. But there is no blame to give.. to you or to your father-in-law or your hubby. We scambloggers are trying to spread the word far and wide so that the plight of lawyers becomes part of the public conscience.

  15. Elizabeth Warren has been saying this for years.

    And in her books:
    The Two-Income Trap: Why Middle-Class Parents are Going Broke

    The Fragile Middle Class: Americans in Debt

  16. How can you blame the victim when there is fraud perpetrated by a "noble" industry like higher education? "Everybody knows" that education will give you access to a better job and lawyers make good money. Even if you assume lawyers don't make good money, you still expect a middle class lifestyle, which is what a lot of people going to law school were looking for.

    I mean we still blame ourselves anyway, but don't pretend that the higher education industry and law schools aren't trying to mislead people. Any other industry and this is FRAUD plain and simple. Every victim of a fraud is still a victim, even if they "should have known better." Even if they could have avoided the fraud, it doesn't somehow let the defrauders off the hook, what they did is still the crime and what is wrong.

    I really dislike these apologists, one of the reasons that this scam is still perpetrated is the law schools don't allow dissent at all. Same thing with JD Underground. They will just not show any comments from anybody that wants to show the true statistics and cautions students.

  17. You're a's not a fraud until the courts say it is.

    So rally together some people and start trying to get a court to do so. You want have to be willing to battle for it.


  18. Hi,

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  19. I suspect in the future that more people will stop investing future income towards college and instead focus on pay as you go. That will collapse the college bubble. Once that happens, more people will become primarily savers instead of consumers. But it is hard to save now after graduation when you already decided to spend future earnings to get that degree.

    I think college loans are the worst scam of all because they cannot be discharged in bankruptcy denying everyone who has one a chance for a new start. Add law schools knowing that and still spreading distortions about the earnings potential of a law degree just adds another layer of scam.



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