So I’m 20 and I’ve started looking at the salaries of jobs/careers, and this is the impression I’ve gotten. Like that you could spend years cramming a ton of knowledge about a very niche field, and still only get 2-3x what a run-of-the-mill job makes. Is this true? If yes then I guess this route to wealth would only make sense (due to the diminishing returns) if the topic truly spoke to you, right? Are there alternative career paths to good pay than being really good at something really specific?
To some extent it is accurate. Only a finite amount of knowledge can be applied to a task and excess experience doesn’t bring any additional benefit on its own.
The problem is you’re comparing labor to labor. Try owning property, that graph has exponential growth with no cieling, you know, like cancer.
You have a point, I guess I forgot to consider Playing The Game. And yeah, investing something off the side does sound like a good idea.
LABEL YOUR FUCKING AXIS AAAAAAAAAA
I can clear that up for you. The X axis is vibes and the Y axis is vibe dependent vibes.
X would be hardness of job and y would be salary
After many careers and much money earned and spent, I now try to go by „ikigai“. Its a japanese theory and teaches you to be aware of what it is that you want, what makes you money, what the world needs and what you‘re good at, basically. This is how I went from a very well paid but soul sucking job to a lesser paid but much more fulfilling work.
For me it was building computers and the stuff around it. Its fun and it makes decent money if done right.
Good luck!
The amount of money you save (and invest) isn’t accurately depicted with this though. Living expenses don’t necessarily grow with take home, if you keep lifestyle creep to a minimum.
So what this means is that if you make $100k and save $10k/year, if you start making $200k you can save the same $10k/year, plus the entire additional $100k after taxes (let’s just say that’s $50k+). So you doubled your salary but your savings went up 6x+.
What are your x and y axes here?
X is years of experience , y is a combined axis, technical knowledge for the green line and salary for the red line
Y is wage, X is experience. Green is just Y=x
So then what does the green line represent?
The way I expected it to work when I was younger
my understanding is the that green line represents the linear relation of salary to knowledge which OP would consider fair and just. therefore the part where red line is above the green one means people who earn below average are overpaid for their knowledge and professional contribution. and similarly, the part where the red line is below the green one means people who earn above average are underpaid
Yup! Well infered. My bad for not writing that in.
Y=x
Generally speaking, wealth is not built by working. It’s built by investing. It’s possible to have a relatively small salary and get relatively wealthy if you consistently live below your means and invest the surplus. Power of compounding.
Oh I see, I will keep this in mind. Yeah I suspected that any jobs that got you super good money were not because of the knowledge but because of playing the game/luck.
Salary really depends on value provided or enabled. That’s why more knowledge stops mattering at a certain point, someone with a month of experience driving a forklift is less valuable than someone with 3 years, but 6 years of experience isn’t significantly different.
There’s also benefits to being closer to money to show value. This is why sales jobs tend to pay better, as showing direct responsibility for 1 million in sales vs keeping the machines running that made the product.
There’s also benefits to being closer to money to show value
Ah that’s a good tip actually
Is there a field where that red curve is flipped so that each extra aquired unit of expertise earns you exponentially more money?
It’s hard to overstate how much money “2-3x what a run of the mill job makes” is over the course of a lifetime. I guess to you right now it doesn’t seem like much, but someone who makes three times more money than someone else is significantly more well off. There aren’t any wage jobs that are going to net you exponential salary growth. Your only hope there is to strike gold and found PayPal or Microsoft or something.
I guess to you right now it doesn’t seem like much, but someone who makes three times more money than someone else is significantly more well off.
Oh I see. Ok I’ll keep that in mind.
This is very true
Some people fall into the lifestyle creep trap and get accustomed to spending what they make. If you make 2x average and live relatively normally you’ll find your savings grow quick.
Even if you do make good money, it’s best not to let that go to your head.
Sales. No joke — the knowledge you need has a hard cap (the product line) but sales is commonly the highest-paid entry level employee (as long as you hit commission).
Now add a line in here for “effort” flattening out over time and that’s what I wanna see.
bullshitting other people
Manipulativeness
When Epic started hiring every software engineer in video games they flipped that red curve, at least to the right of that blue line.
This is somewhat off topic, but it is actually related to knowledge, income, and returns.
I’m telling you from experience, make enough money to live comfortably and stop when you get there. If at all possible, don’t have a long commute. Don’t have a prestige job. Don’t have a position that requires OT or sprints. I deescalated my role to something more banal and my happiness went way up.
You’re likely not in a position to do that at 20, but when you get somewhat into a career and life sucks and you hate your work and you want to die, start looking for something that pays less but also doesn’t suck the life out of you.
Mmm yess this is my plan
not really true depends on the field
Get into politics.
Replace “expert knowledge” with “knowledge about how to manipulate people to vote for you”
Take bribes. Listens to whats your puppet-masters tell you to vote.
Ez money.
/s
Obviously ripoffs are the best money makers :-) But I’m not that kinda guy
The green curve would be higher that the red one everywhere.
There is a brief inversion at high salary values where CEOs exist
Nassim Nicholas Taleb talks about this when he explains his own career. He realized the amount of effort he had in him was never going to change, so he wanted a field where earnings weren’t limited by his own effort - the dream of passive income. He became an expert on risk and a well known writer. https://en.m.wikipedia.org/wiki/Nassim_Nicholas_Taleb
Agreed, good tip. Yeah his persective is certainly valuable
Good recommendation.
Nassim Nicholas Taleb also has a bunch of useful writing on taking risks that applies very well to financial choices like investments and career choice.
It might be accurate for one person in a hundred.
