Twenties are for Learning – Thirties are for Earning

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Over the course of the last year one of the biggest surprises that we have seen is the disillusionment of students who are about to graduate, in terms of their salary expectations and how quickly they must start paying off their student loan debt.

We hear it all the time, and it’s usually one of two responses. “I can’t take this opportunity because the salary offered won’t be enough to pay off my student loans”, or the quintessential “I want to make bank!”. Both are inherently flawed.

Let’s start with the first one of “I can’t take this opportunity because I won’t be able to pay off my student loans.” We get this reply so much that we became curious to see how long it takes the average person to pay off their student loan debt.

Turns out, most people don’t make a dent in their loans throughout their first five years of their career. In reality, most people don’t make a dent in their debt for the first 10 years! Through our research we found that it takes the average person 20 years to pay off their student loan debt!!! (Source)

Let’s think about this; many recent graduates are turning down great opportunities, both domestically and internationally, because of the weight of student loan debt.

Rather than objectively looking at an opportunity and saying to themselves “is this an opportunity that I am passionate about and will provide me with a great skill set and career trajectory?”, they are saying to themselves, “I’ll take a job that I am less thrilled about because it will pay me more money and allow me to pay off my student loans faster.”

However, as we see from above, this is inherently flawed. Students are taking jobs they don’t like under the illusion they will earn more money and pay off loans faster. In reality they don’t make the dent in their loans they were hoping to make. This leads to frustration, burnout, and a career you didn’t ask for.

Now let’s look at the second problem of, “I want to make bank!”

News flash; if you haven’t graduated from an Ivy league school and/or aren’t a software programmer or investment banker, you probably won’t be making the money that you think that you will be making. Students have a perception that they will be able to a) make money, and b) save money. They believe that they will graduate and instantly be handed a great job with great money and save a ton of money.

The harsh reality is that this rarely happens.

Moreover, what many people fail to consider when they have this mentality is the cost of living in their city of choice. For example, we know many people who make upwards of 80k a year, 3–4 years out of school, who are still saving next to nothing on a monthly basis. This means that although you are making a great salary, the cost of living in that city is so high that you don’t actually end up saving any money.

To prove this assumption, we once again did some digging to see what people actually save during their twenties. Turns out, most people save next to nothing.

This means that most people actually save the bulk of their money and earn financial stability once they are in their thirties. Not what they told you in school? Yeah, us too.

So let’s think about this, students are graduating with debt and choosing jobs that they mistakenly believe will allow them to pay off loans, and others are choosing jobs for financial security that doesn’t really exist. Seems pretty flawed when you think about it this way, right?

In reality, what this actually paints a picture of is a much larger problem. During your twenties, you probably won’t save much money or actually pay off the bulk of your student loan debt. It’s a hard truth, but if you understand this, you break the cycle of letting financials be the primary factor for evaluating a job opportunity.

Instead, what you should do is choose a position that allows for you to learn, grow, and take on responsibility. Take a job that will provide you with a skill set you can take anywhere. Take a job for less pay that you are passionate about, and understand that money will come if you become great at something that you love doing.

Go talk to an investment banker and see how much they actually like their job. Then go to a kindergarten teacher and ask them the same question. You can probably guess what their response will be.

Realize that the bulk of your savings will come in your thirties, when you have developed a skill set you can market. Realize that financial stability comes with age, and remaining patient and intrinsically motivated is a much larger predictor of your success than the money you earn between 21–25.

In the end, what we’re trying to emphasize is that “twenties are for learning, while thirties are for earning.”

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