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Career Analysis

Introduction

After listening to the Does College Matter? Podcast, I resonated with the following statements:

  • "The rate return on a college degree is better than the rate of return on the average bond(or other investment)" -Mary Daly

-Mary's statement shifted my perspective because I never looked at my knowledge as a monetary investment and that motivates me more to succeed.

  • Jody emphasizing that it is okay to take a break from school. That sometimes it is needed to find something that piques your interest and propels you to complete a degree.

-This spoke to me because I have been absent from school for a year and a half after leaving San Jose State University. I had the mindset that college will only get you a job to be someone else's means of financial success. This mindset was caused by the manipulation of a multi-level marketing business. I needed that time to find myself and believe again that college will add to my success tremendously.

Continuing my education to obtain a bachelors in business allows me to have a higher annual pay than I would in a non-degree job. Having higher pay makes it possible to provide my son with a better quality of life by living on the central coast close to family and friends.

Marginal Benefit Data

  • Personal Financial Advisor
  • Bachelors Degree(economics, business, or similar field)
  • Median annual pay 2019(bls.gov)- US:$87,850 CA:$85,197
  • Median annual pay 2020(edd.gov)- CA: $119,823.61 SLO: $174,479.78
  • Income range annu.(edd.gov)- CA: $48,147.32 - $156,374.32+ SLO County: $51,924.29 - $174,479.78+
  • Obtain a Bachelors degree in Business at San Diego State University
  • Jobs are projected to increase 4% from 2019-2029 in this field
  • SLO County Stats

-Unemployment: 9.9%. At Feb. 2018 the rate was 3.2% and Feb 2020 3.0%. There was miniscule rises and falls in between then, but really jumped up in April 2020 to 14% due to COVID-19.

-Bachelor Degree or higher: 34.6% and has been over 30.6% since 2010.

-Home ownership rate in 2018: 60.479%

-Disconnected youth (under 18 not in school and/or job field): 3.09%. This is important for me because I want to raise my son in SLO.

  • Couple realizations:

-The differences in the bls.gov and edd.gov data, I am presuming it is because they were collected on two different years.

-SLO county's median pay is higher than California and San Francisco's. There is more overall wealth in SLO and the cost of living is higher. There are also a lot of people who are or plan on being retired in this area that may need advice on how to best allocate their funds.

Marginal Cost Data

  • Direct Cost of Education: $11,787

Breakdown: $8,937 current student loan debt

1 year at Cuesta to obtain AA-T: paid in grants

Annual cost San Diego State($6,924) minus average Pell Grant total ($5,024): $1,900 yearly. Will attend an extra semester so add $950.

8,937+1,900+950= $11,787 roughly

  • Opportunity Cost: $50,877.5

2019 full-time annual income X 2.5 (years of schooling I have left)= $50,877.5 roughly

  • Economic Cost: $62,664.5

11,787(DCE)+ 50,877.5(OC)= $62,664.5

Future Impacts/Skill Sets

  • I believe future technologies will continue to positively impact financial advisers.

  • Due to Covid-19, most communications have switched to virtual. This is increasing productivity but poses challenges for older generations that aren't as tech savvy and makes it harder for advisers to disconnect from working.

  • Virtual communication has allowed overhead costs to decline and there is more flexibility for advisers and clients.

  • New technologies are allowing financial planners to spend less time on the least human activities (math, investment managing, re-balancing) and spend more time answering harder holistic questions to better the customers quality of life.

  • Financial analysts have only a 23.3% chance of being automated according to npr.org.

Marginal Analysis

Future Value: 51,924(1+0.036)^30= $2,707,842.28

Breakdown= $51,924 (10th percentile pay in San Luis Obispo)X 1.036* = $53,793.27 continued 30x

51,924+53,793.27+55,729.82+57,736.1+59,814.6+61,967.9+64,198.78+66,509.93+68,904.3+71,384.83+73,954.7+76,617.1+79,375.275+82,232.8+85,193.17+88,260.12+90,907.92+94,180.6+97,571.1+100,498.24+104,116.18+107,864.362+111,747.48+115,770.389+119,938.12+124,255.9+128,729.1+133,363.4+138,164.44+143,138.356=2,707,842.28

*The 0.036 comes from the edd.gov 2018-2028. The percentage for long term projection is 36.4% for personal financial advisers in Santa Cruz, Ca because there wasn't data for SLO. I divided the 36.4% by 10 yrs to get the 3.6% projected yearly estimate. I thought Santa Cruz would be relevant because the cost of living is similar to here.

Optimal Cost: 20,351(1+0.036)^30=$1,031,677.45

Breakdown= $20,351(optimal cost) X 1.36= $20,352.04

20,351+20,352.04+21,084.7+21,843.76+22,630.13+23,444.82+24,288.83+25,163.23+26,069.11+27,007.59+27,979.87+28,987.14+30,030.68+31,111.78+32,231.81+33,392.15+34,594.27+35,839.67+37,129.89+38,466.57+39,851.37+41,286.02+42,772.31+44,312.12+45,907.35+47,560.02+49,272.1766+51,045.97+52,883.63+54,787.44=1,031,677.45

Difference: $2,707,842.28(college degree jobs) -$1,031,677.45(OC)= $1,676,164.83

Marginal Choice: The choice of pursuing a college degree job outweighs the optimal cost by over 1.5 million dollars over 30 years. It is a choice that makes the most sense financially for my family and I am excited to take this path

Summary

  • Through career analysis, I found that the career I was previously interested in (a small baking business) was not as profitable as I thought.

  • From data provided I had many life changing realizations. This project helped me redirect my future to be more financially sustainable.

  • I originally wanted to obtain just a AA in business and potentially transfer to Cal State Fullerton for my bachelors. After comparing schools through College Scorecard and CollegeNavigator, I realized SDSU's online program is the best option for me.

  • Completing my bachelors in business will propel me to make an income I didn't think was realistic for me.

  • It is over 150% monetarily worth my time and will add self worth and value to myself.

  • I am grateful for the opportunity to complete this presentation and learn an incredible amount of information that excites me.

References

Best Online Business Schools in California. (2020, August 26). Retrieved September 17, 2020, from https://www.collegechoice.net/rankings/best-online-business-schools-in-california/

Bisnoff, J. (2020, August 25). A 30-Year Financial Advisor With Over $4 Billion Says The Industry Still Has A Lot of Work To Do On Diversity Efforts. Retrieved September 17, 2020, from https://www.forbes.com/sites/jasonbisnoff/2020/08/25/a-30-year-financial-advisor-with-over-4-billion-says-the-industry-still-has-a-lot-of-work-to-do-on-diversity-efforts/

Estimated Cost of Attendance. (n.d.). Retrieved September 17, 2020, from https://admissions.sdsu.edu/about_sdsu/costs_of_attendance

Osterland, A. (2020, May 18). Financial advisors face new challenges in the way they manage workflow, communicate with co-workers and clients. Retrieved September 17, 2020, from https://www.cnbc.com/2020/05/18/financial-advisors-face-new-challenges-in-the-way-they-manage-workflow.html

Wadhwa, V. (2017, July 07). When Machines Can Do Most Jobs-Passion, Creativity, and Reinvention Rule. Retrieved September 17, 2020, from https://singularityhub.com/2015/07/27/when-machines-can-do-most-jobs-passion-creativity-and-reinvention-rule/

-Outdated document but current relative information is still applicable.

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