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Eighty percent of millionaires have a college degree compared to 28 percent of Americans. It’s expensive, but higher learning pays off. If you hold a Bachelor’s degree, you can expect to earn almost twice as much as someone with a high school diploma1.

EDUCATION AVERAGE ANNUAL SALARY (2005)
Advanced degree $79,946
Bachelor’s degree $54,689
High school diploma only $29,448
No high school diploma $19,915

If money is your hope for independence you will never have it. The only real security that a man can have in this world is a reserve of knowledge, experience, and ability.
-Henry Ford

Rich Jobs
Education is the key to higher-paying jobs. Take a look at the following table from the U.S. Bureau of Labor Statistics2. In general, the richest jobs fall into the categories of health care, management, and law. No wonder millionaires are so keen to send their kids to medical school and law school.

OCCUPATION TOTAL JOBS IN U.S. AVERAGE ANNUAL SALARY (2006)
Doctors and surgeons 525,030 $141,440–$184,340
Orthodontists 5,200 $176,900
Chief executives 299,520 $144,600
Dentists 86,110 $140,950
Airline pilots, copilots, flight engineers 75,810 $140,380
Podiatrists 9,020 $118,500
Lawyers 547,710 $113,660
Air traffic controllers 23,240 $110,270
Engineering managers 183,960 $110,030
Natural science managers 38,660 $107,970
Marketing managers 159,950 $107,610
Computer and information systems managers 251,210 $107,250
Sales managers 307,960 $102,730
Petroleum engineers 15,060 $101,620
Financial managers 468,270 $101,450

Masters of the Universe
Not included in this list are financial jobs such as investment banker, venture capitalist, and hedge fund manager. Average starting salary is $134,000 a year for an investment banker3. This rises to $1 million with 10–15 years of experience. Similarly, partners at a top tier venture capital firm or hedge fund can easily earn $1 million in annual salary4. These salaries are lucrative, but the real payoff is the “carry”—the 20–30 percent of profits that partners share before paying back investors. For example, assume that a hedge fund manages $10 billion in investments. If it earns a return of 20 percent for the year, this translates into a profit of $2 billion. If there are four partners, and they split 20 percent of the profits equally, this results in a payday of $100 million per partner.
 
Math like this is how hedge fund manager John Paulson earned an estimated $3 billion by betting against sub-prime mortgages5. Yes, that’s “billion” with a “b.” In 2007, Traders Monthly reported that 100 hedge fund managers each took home $75 million or more in total compensation. Forget law school and medicine. The real money’s in finance.

Your Dream Job
For many people, job satisfaction is more important than money. Find the most satisfying jobs for your personality type by reading this book:

Choose a job you love, and you will never have to work a day in your life.
-Confucius

Job Hunting
In 2007, about 31 million Americans quit their jobs6. Another 20 million were laid off or discharged. In total, almost 40 percent of the workforce turns over every year, and the median job tenure is only 4 years7. With all of this movement, it’s a good idea to have a backup plan. As career counselors will tell you, the best time to look for a new job is when you already have one.

In a study of people who were recently hired for professional, technical, and management positions, 74 percent found their jobs through personal contacts, 10 percent through newspaper ads, 9 percent through agencies, and 7 percent through the Internet or other means8. For jobs through personal contacts, 44 percent had a new position created just for them. The most useful contacts were distant acquaintances. Twenty-eight percent saw their contact less than once a year, 55 percent saw them more than once a year but less than twice a week, and only 17 percent saw their contact more than twice a week9. Leverage the power of your network when you’re looking for a new job. Spread the word to as many people as you can.

Never quit a job unless you have another job. You are perceived as more valuable if you are working than if you’re unemployed.
-Seymour Schulich

You’re Hired
When deciding who to hire, managers place the most weight on intellectual ability and conscientiousness. According to personality researchers, conscientiousness is the best predictor of job performance10. Conscientious workers are organized, disciplined, dependable, and detail-oriented. They take initiative in solving problems, and stay focused on work tasks. In a study of sales representatives, conscientious workers were more likely to set goals and stay committed to them11. In turn, they closed more sales and earned higher performance ratings from their supervisors.

After conscientiousness, the next most important personality trait is agreeableness. Agreeable people work well in teams because they are cooperative, tolerant, flexible, polite, and place the needs of the team above their own. The highest ratings for job performance are usually achieved by workers who are both conscientious and agreeable.

Distinguish Yourself
Unless a job has been created just for you, you’re probably competing against dozens of other applicants. Stand out from the crowd with these tips:
  • In your cover letter, discuss how you will immediately make a difference for the team. Give concrete examples of how you will add value.
  • When an interviewer asks you a question, always relate the answer back to how it will help the organization. Be specific.

Working Women
In the United States, about 59 percent of women are working12. Twenty-six percent of women work part-time, compared with 11 percent of men. Although women hold half of all management and professional jobs, the percentage varies significantly by profession. For example, women make up 86 percent of legal assistants, and 89 percent of dieticians and nutritionists, but only 14 percent of architects and engineers, and 29 percent of physicians and surgeons.

Slowly but surely, sexism is being eliminated from the workplace. From 1979–2004, women’s earnings as a percentage of men’s increased from 62 percent to 80 percent13. Nevertheless, it’s human nature to judge women more on looks and appearance than men. Short, fat men earn the same as tall, fit men. But it’s not equal for women. Tall women earn more than short women, and skinny women earn more than fat women. The exception is women who have skills that are in high demand. Employers can’t afford to discriminate when there’s a shortage of skilled labor.

Price per Pound
Although fat men aren’t discriminated against in the workplace, they should watch their waistlines when it comes to net worth. Demographic studies show that obese men and women have a net worth that is roughly 50 percent less than people with normal body mass14. The peak net worth for white women is associated with a Body Mass Index (BMI) of 20 kg/m2. This is equivalent to someone who is 5’5 and weighs 120 pounds. On average, a woman with a BMI of 20 kg/m2 will have a net worth that is 44 percent greater than a woman with a BMI of 30 kg/m2 (e.g., 5’5 and 180 pounds). For white males, peak net worth occurs at a BMI of 24 kg/m2 (e.g., 5’10 and 167 pounds).

Dress for Success
The 1980s were outrageous—big hair, bright makeup, and pink miniskirts. That was then, this is now. Researchers from Lawrence University in Wisconsin had one group of women wear lots of makeup, high-heeled shoes, tight knee-length skirts, and low-cut blouses15. A second group was dressed more conservatively with black slacks, turtlenecks, business jackets, flat shoes, and minimal makeup. For high-status jobs such as managers and executives, sexy dressers were rated as less competent by both men and women. For lower-status jobs such as receptionists, sexy appearance had no effect on ratings. Don’t give your co-workers a reason to look down on you—dress professionally and stay away from the ‘80s.

Table Manners
Imagine you’re at a fancy black-tie dinner. Your boss is sitting beside you, and you want to make a good impression. A waiter serves the appetizer and you reach for a fork. Should you use the big one or the small one? Are you allowed to use a knife? Don’t embarrass yourself. Learn proper table manners from the following websites:

Superstars
In the 1980s, economist Sherwin Rosen proposed the concept of the “Superstar Premium” to explain how a few people earn enormous amounts of money by dominating their fields of work. For example, Vanessa Mae is arguably the world’s most popular violinist. When she was 7, she asked her mother, “How much money do I have to earn to be able to eat caviar every day?16

Fast forward to the present. Vanessa is now a multi-millionaire who’s sold more than 10 million albums (and is probably sick of eating caviar). Her record-breaking sales are powered by two factors: (1) there are customers around the world who want the very best, and are willing to pay for it, and (2) modern communication methods such as TV and the Internet let everyone know that she’s the best. Superstardom gives rise to a “tournament effect” where winner takes all and everyone else fights over the scraps17.

Consider another example. There are about 249,000 musicians and singers in the United States, and their hourly wage is $17.8518. In 2004, pop star Madonna earned $50 million19. This works out to an hourly rate of about $28,000, or 1,500 times more than the average singer. Even her biggest fans would probably agree that the Material Girl is not 1,500 times better than a Las Vegas lounge singer. But thanks to the Superstar Premium, you only have to be slightly better than your nearest competitor to take home all of the marbles. It takes at least 10 years of dedicated training to become the best. That’s a big commitment. But if you don’t try, you’ll never know if you had a shot at greatness.

In a free market, we reward the exceptional.
-Seth Godin

Make More Money
Michael Masterson writes Early to Rise, the Internet’s most popular health, wealth, and success e-zine. It’s available for free at www.earlytorise.com. In his book Automatic Wealth, Masterson offers advice on how to get radical raises:
  1. Figure out how your business creates profits.
  2. Understand how your job contributes to that process.
  3. Modify your job so that more profits are produced as a result of what you do.
  4. Make sure that the people who are in charge of giving raises know how much more money you are making for the company.

References
  1. U.S. Census Bureau. June 14, 2007. Back to school: 2007–2008. CB07-FF.11.
  2. U.S. Department of Labor, Bureau of Labor Statistics. (2007). Occupational employment and wages, 2006. USDL 07-0712.
  3. Princeton Review. Career: investment banker. http://www.princetonreview.com/cte/profiles/facts.asp?careerID=84
  4. Rivlin G. (2005). So you want to be a venture capitalist. New York Times. May 22, 2005.
  5. Trader Monthly. (2008). Cash of the titans: the Trader Monthly 100. April 2008.
  6. Bureau of Labor Statistics. (2008). Job openings and labor turnover: January 2008. March 12, 2008.
  7. Valletta R. (2007). Anxious workers. FRBSF Economic Letter. Number 2007-13. June 1, 2007.
  8. Granovetter M. (1995). Getting a job: a study of contacts and careers. 2nd edition. University of Chicago Press.
  9. Granovetter MS. (1973). The strength of weak ties. American Journal of Sociology. 78(6):1360–1380.
  10. Witt LA et al. (2002). The interactive effects of conscientiousness and agreeableness on job performance. Journal of Applied Psychology. 87(1):164–169.
  11. Barrick MR, Mount MK, Strauss JP. (1993). Conscientiousness and performance of sales representatives: test of the mediating effects of goal setting. Journal of Applied Psychology. 78(5):715–722.
  12. U.S. Bureau of Labor Statistics. (2005). Women in the labor force: a databook. U.S. Department of Labor. Report 985.
  13. Mitra, Aparna. (2001). Effects of physical attributes on the wages of males and females. Applied Economics Letters. 8:731–735.
  14. Zagorsky JL. (2005). Health and wealth: the late 20th century obesity epidemic in the U.S. Economics and Human Biology. 3:296–313.
  15. Glick P et al. Evaluations of sexy women in low- and high-status jobs. Psychology of Women Quarterly. 29:389–395.
  16. Williamson H. (2007). How the super-rich just get richer. BBC News. November 29, 2007.
  17. Rosen S. (1981). The economics of superstars. American Economic Review. 71(5):845–858.
  18. Bureau of Labor Statistics. (2007). Occupational Outlook Handbook, 2006–07 Edition, Musicians, Singers, and Related Workers. U.S. Department of Labor. http://www.bls.gov/oco/ocos095.htm
  19. People. (2006). Madonna tops Britney’s Guinness record. September 29, 2006.

Copyright © 2009 by Paul Lem, M.D.
Buy the book at www.MasterLifeFaster.com
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