Jul 282016
 

University Grads Make More Money Over Time

According to a recent study from the University of Ottawa, the cost of higher education is still worth it. University degrees are linked to higher salaries almost regardless of the subject. 🙂

The study published this week looked at income data for 620,000 graduates of 14 different universities and colleges between 2005 and 2013, spanning an 8 year period to gauge progress over time.

On average, graduates from universities in 2005 made $45,200 in inflation-adjusted income in their first year after school. This number increased every year after that, growing by a total of 66% to $74,900 in 2013, which covers an 8 year period. But college graduates started off somewhat lower. The average income for a new college grad was $33,900 in 2005. After 8 years it has grown by 59% to reach $54,000. These numbers only represent the average. Individual results of a college or university education can be very different from one person to another.

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A closer look at the study’s findings reveal a big difference by gender. Both men and women start off making about the same after graduating university. But 8 years later, those averages diverge. The typical male university graduate who started working in 2005 was making 91% more money by 2013. His female counterpart who graduated with him saw her income only increase by 42% from 2005 to 2013.

I think there are a couple of main reasons for the gender discrepancy in income growth.

  1. Men and women tend to choose different majors. STEM fields, particularly technology and engineering, are pursued more by men than women. These fields also consistently offer lucrative career paths.
  2. Many women tend to take time out of the workforce to raise children. This is due to a fact of nature. Nearly every research has shown breastfeeding increases a baby’s intelligence. Men can’t give birth or breastfeed.

Higher Education in Universities

As with any report we have to consider any hidden agendas. A university study that concludes going to university is a good decision is like a real estate agent advocating for home ownership. It doesn’t mean they’re wrong, but we should be aware of the bias. 😉 We can also keep in mind that university graduates have been pre-screened to have certain qualities like being smart or ambitious enough to attain high grades in high school. These personality traits often lead to higher earnings regardless of attending university; correlation ≠ causation.

Higher education isn’t for everyone. Some folks excel at formal education, while others do better with a trade or entrepreneurship. The important thing to remember is that learning is a lifelong process and we can pursue it in many different ways. 🙂

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Random Useless Fact:

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May 122014
 

I read an article recently which suggests that single women make more money than single men in the U.S.

According to a study by Reach Advisors, in most major American cities the median income for single, childless women between 22 and 30 is 8% higher than that of their male counterparts 🙂

Research has shown that young women tend to be more educated than men, and are more likely to get degrees in the knowledge-based fields. Last year women earned the majority of Bachelor’s and Master’s degrees, and the same results are expected for this year. Young women also appear to be more career driven. About 67% of females between 18 and 34 rank their professionals goals as top priority, compared with only 59% for young men.

Looks like all the efforts by society to encourage gender equality, elevate female status and their economic independence is really paying off 🙂 It’s no surprise that more and more women are becoming the primary breadwinner for their households. It looks like young men like myself should be careful lest we get left behind in the job market, lol.

But earlier this year the U.S. president came out with the following statement.

Today, women make up about half our workforce. But they still make 77 cents for every dollar a man earns. That is wrong, and in 2014, it’s an embarrassment.
~Barack Obama

Hm, this seems to contradict the other study. Nevertheless, assuming this was true, why aren’t there more female employees working on Wall St and other knowledge-based industries?

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Continue reading »

Jan 242014
 

According to a new study by BMO, it appears that men are better savers, on average, than women. Last year each Canadian men saved $10.5K on average, while the ladies saved about $7K each. That’s a difference of 50%. 😯 These results are interesting because last year another study showed that young men are more likely to stay at home with their parents, but young women move out sooner and are more independent. Maybe guys can save more money because we tend to mooch off our parents more. 😛 But on a more serious note I believe the income gender gap has something to do with this. Women are still making less than men in many professions and the less you make the less you have to save. 🙁

The good news is both genders in the BMO study say they plan to save more this year in 2014. 🙂 $11.2K for the men and $8K says the women. Good luck everyone. 😀 The report also revealed saving differences across different regions in Canada. 🙂

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Some what we can learn from this information.

  1. It’s easier to reach our goals if we are around like minded people, so if you are young and looking for work consider moving to Alberta or B.C. if you aren’t already here. 🙂 We have low unemployment, financially responsible government, and high wages – what’s not to like? 🙂
  2. Try to save at least the 2014 amount for the province that you live in. This is because money is relative and in order to get ahead we must be better than average. 😀 Even if we managed to save $100,000 this year, it still wouldn’t feel very much if everyone else managed to save $1,000,000 during the same time. I happen to live in B.C. so I will personally aim to save at least $15,117 this year to make sure I don’t get left behind. 🙂 For benchmarking purpose, last year I managed to save about $18K.
  3. Invest our savings with tax efficiency in mind. For most people this means maxing out the contribution room for our TFSAs and RRSPs, etc. before investing in a non-registered account.

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Random useless fact: The RCMP was formed in 1920 but it wasn’t until 1974 that women were allowed to become members.

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Nov 182013
 

We have come a long way in society to narrow the wage gap between men and women. We are also seeing more women in executive level positions in large companies 😀 But females are still disproportionately represented in corporate leadership roles 😐 For example, compare the Senior Management team to the other staff members of the company below. Click image to enlarge.

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Coincidence or sexism?

I read an article recently that suggests part of the reason it’s still more difficult for women to climb the corporate ladder than men, is because of women themselves 😯  A recent Gallup poll in the U.S. shows that 41% of Americans don’t have a preference which gender their boss is. However 35% preferred a male boss, and only 23% prefer a female boss. What’s surprising to me is that more women in the poll (40%) than men (29%) said they would prefer a male boss. I thought girls would want to stick together, but the research says otherwise ( ・_・)

There appears to be some kind of conflict of emotions when women witness other women get into positions of power and authority. On the one hand everyone celebrates the accomplishments of hard working women as they achieve success in the corporate world, much of which is still dominated by men. Yeah! girl power! 😀 But on the other hand, it’s often women who perpetuate the worst stereotypes about working for other women. As one editorial director puts it “Everyone applauds when they shatter that glass ceiling. Then they pick up the shards, and start cutting away.” Yikes 😕

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But why do female bosses get such a bad reputation? According to Doctor Robi Ludwig, a woman, bad female bosses may have Queen Bee Syndrome, which describes the “actions of the alpha female in the workplace who tries to preserve power at all costs.” She explains how this is a very real and common thing.

Instead of promoting her younger counterparts, she feels threatened by them, judges them, talks about them and, in many cases, ends up obstructing their attempts to climb the corporate ladder…. According to one group of German researchers, women who reported to female supervisors had higher cases of depression, headaches, heartburn and insomnia than if their bosses were men. ~Dr. Robi Ludwig

Continue reading »

Oct 292011
 

Men generally have more money than women. That may not be a surprise since men tend to have higher incomes as well. However, I didn’t expect the difference to be so big. In 2005 in Canada, the median male had $184,964 of wealth, and the median female had $105,470. That makes guys 75% richer than girls on average. And around the same time the median family net worth in the US was $93,100. This of course doesn’t mean Canadians are richer than Americans, our wealth is just distributed differently than their’s.

The good news for younger adults is that our bar has been set pretty low. The median net worth for my gender and age group for example is only $28,203. Although my net worth is higher than that, the median debt to asset ratio for this same group is 0.41, where mine is over 0.70, which means for every dollar I have, I owe someone else more than 70 cents. I know carrying around almost a quarter million dollars of debt in my 20s is kind of risky but I can’t help myself from borrowing more and more because credit is just so cheap and easy to get.

So men apparently have 1.75 times more money in general than women. So here is some quality advice. Ladies, don’t settle for any man who is struggling with his debt because there are plenty of other guys out there who are more financially sound. And guys, don’t marry a girl just because she likes you for your money.