college, career & life planning 1 college student career planning orientation

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College, Career & Life PlanningCollege, Career & Life Planning

College Student Career

PlanningOrientation

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The Stakes Have Never Been Higher

The Tools are Available

The Challenge is to Inform &

Motivate

Career PlanningDilemma

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• Internet

• Outsourcing

• Global Marketplace

• No Safety Net

Higher Stakes – It Is A Different World

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Internet• Consumers have more information about product

pricing, quality, availability, etc. than ever before.

• Increases consumer power to demand low cost/

high quality products, efficiency and speed.

• Only those companies that meet these higher

consumer expectations will survive.

• Companies require the best people and processes.

• Increasingly competitive workplace.


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Outsourcing• Companies no longer perform all functions.

• Functions such as manufacturing, product

design, payroll, software development,

customer service, engineering, etc. are

being “outsourced” to other firms

(frequently in China, India, etc.)


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Global Marketplace/Workplace• Fewer trade barriers.

• More global/multi-national companies

• Falling communication cost has made the

world much smaller.

• Our young people must compete in a

“global workplace”.


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Retire Early? Consider These Challenges1. Few employers offer traditional “defined benefit”

company pensions and the number is shrinking. In a March, 2005 Survey by Bureau of Labor Statistics only 22% of workers in private industry had access to “Defined Benefit” retirement programs.

2. Social Security’s future is uncertain.

3. Life expectancy continues to rise (49 yrs. in 1900 vs. 75 yrs. in 1990). You may live to be 90 or 100 years old.

4. Recently many household costs (i.e., housing, electricity, insurance, gas, health care) have risen much faster than family incomes.

5. Major obligations (e.g., kid’s college, parent care) place additional strain on financial resources and may limit savings.

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Retire Early? Consider These Challenges6. Future investment returns are generally expected to be

much lower than the levels experienced in the recent past. Average returns for U.S. stocks exceeded 15% in the 1980’s & 1990’s. Future estimates vary, buy many analysts think average annual returns of 6-8% are more likely.

7. To be confident of not running out of money, you’ll likely need about $300,000 in appreciating assets (i.e., stocks, bonds, real estate) for every $10,000 per year you need to spend in retirement.

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1. How you spend most of your "awake" hours for the next 40 years?

2. Your opportunities for personal satisfaction and growth?

3. Your ability to meet your family's needs (e.g. housing, medical, college)?

4. Your ability to eventually retire with the financial resources to enjoy it?

Career DecisionDetermines

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Lifetime Valueof Education

$0

$500,000

$1,000,000

$1,500,000

$2,000,000

$2,500,000

$3,000,000

Less thanHigh School

Diploma

High SchoolDiploma

Some Collegew /o Degree

Associates 2 yrs.

Bachelors 4 yrs.

Masters 6 yrs.

Professional 7+ yrs.

Doctoral 8 yrs.

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Hours Invested

0

10000

20000

30000

40000

50000

60000

70000

80000

90000

Grades 1-12 College Working

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Awake Hours

Eating/Drinking

Household Activity

Care Household Members

Purchasing Goods

Civic Religious

Leisure Sports

Work

EducationPersonal CareTelephone Other

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How Much IncomeDo I Need?

Annual Income Required (Given Various Interest Rates)

House Price 6.0% 6.5% 7.0% 7.5% 8.0%$100,000 $32,857 $34,229 $35,643 $37,143 $38,600$150,000 $49,286 $51,343 $53,464 $55,714 $57,900$200,000 $65,714 $68,457 $71,286 $74,286 $77,200$250,000 $82,143 $85,571 $89,107 $92,857 $96,500$300,000 $98,571 $102,686 $106,929 $111,429 $115,800$400,000 $131,429 $136,914 $142,571 $148,571 $154,400

Assumptions

o 30 yr. fixed rate mortgage. Property tax & Insurance is 2% of market value.

o No downpayment. 100% of house price is financed to simplify analysis.

o Principal, Interest, Prop Tax & Insurance will be 28% of Gross Income

o House is a family's biggest expense and a reasonable indication of lifestyle.

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How Much Will AHouse Cost?

$0

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000

Median Price of Existing Single Family Homes (Select U.S. Cities) 2004

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People Often Invest More Time

Planning Their Vacation Than

Planning Their Career.

Think About It

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• Easy to procrastinate.

• Parents “fell into their jobs”.

• Too scary to think about.

• Too busy. No more homework!

• Don’t know where to begin.

• Don’t see the value.

Why Motivating Youthis Difficult

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• “My son just graduated from college. He doesn’t have a clue what he wants to do. Maybe forensics. Maybe art.”

• “My daughter is a sophomore in college and she hates her major (accounting). She is changing majors, but doesn’t know what to choose. That means at least one more year of college that we cannot afford.

• “Now that I have a college degree, I need to think about a career. I majored in Marketing, but I’m not sure that’s what I want to do.”

• “I hate my major, but switching involves two more years of college. My parents would kill me. I’ll gut it out. Maybe I’ll learn to like it.”

• “I wish I had known four years ago what I know now. I would have taken career and college planning more seriously. My major was easy and fun, but now I cannot get a decent job.”

Result: Poor Choices, Waste and Frustration

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“Typical” Resources Used to Pick a Career

1. TV => There is a big difference between TV drama and “real life”.

2. Friends => They’ll know what sounds “cool”, but unless they have proactively used the career /college tools available, they are probably not a knowledgeable source of information.

3. Life’s Interactions => OK, you have used the services of Dentists, Pharmacists, Teachers, etc. but… Do you really know what it is like to do their job?

4. Parent => A great source, if your parent’s career happens to be “the right one” out of several hundred possibilities for you.

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Better Resources to Pick a Career

“Free” on-line resources

1. To clarify your interest/fit with various careers

2. To compare your personal skills/strengths against those required by various careers

3. To determine which careers offer the most opportunity

4. To develop your list of careers for consideration

5. To learn about the nature of work, education requirements, job outlook, earnings, etc.

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Better Resources to Pick a Career

Talk to People in Careers of Interest

1. Parent’s Friends

2. Friend’s Parents

3. Acquaintances from “Life’s Interactions” (e.g. teachers, dentists, store managers)

4. Career Day Presenters

5. Volunteering, Internships, Job Shadowing

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Suggestions Before Starting

• Don't select a career based solely on $$$. • Do pick a career for which jobs are available with income

levels adequate to meet your family's financial needs.• Don't expect a quick, easy answer. The career planning

process requires time and effort. Invest the time to identify/evaluate careers that "fit" your needs, interests and abilities.

• Do use a variety of tools and talk to several people in each career of interest.

• Don't get discouraged or discredit the process when some “obviously” unacceptable careers appear on a list generated by an interest assessment tool (they will). Career planning is not a precise science. Reason and judgment must be applied.

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Suggestions Before Starting

• Do think about the process as a way to significantly improve your odds (with no guarantee) of selecting a great career. The following table is my rough estimate of how your odds for choosing a great or "perfect" career improve by making an informed decision. Random Gut Informed Decision Feel Decision Perfect Career 1% 5% 20% Great Career 4% 20% 50% Acceptable Career 60% 50% 20% Terrible Career 35% 25% 10%

For example, I estimate that your probability of selecting a "perfect career“ is about 1% if you make a random decision vs. 20% if you make an informed decision.

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Your Interests(e.g., people, math, science)

Identify CareerPossibilities

Your Strengths(e.g., creativity,

leadership, writing)

Your Needs(e.g., income, growth,personal fulfillment)

Occupational Outlook Summaries

CareerOneStop Job Summaries & Videos

Networking, Internships, Job Shadowing, Volunteering

Evaluate/Select a Career

Career Planning Process

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1. Get motivated

2. Self Analysis

3. Develop a list of jobs to consider

4. Get on-line information for evaluation

5. Evaluate job options

6. Prepare a job comparison summary

7. Talk to people in occupations of strong interest.

8. Choose the “right” industry and company.

Career Planning Process

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www.collegecareerlifeplanning.com

Career Planning Tools• Self-assessment• Identify Careers Prospects• Retrieve Required Information• Evaluate Careers• Company/Industry Information• Evaluate Companies/Industries• Job Basics

Web Site Tool Demo

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BUILDING NET WORTH

How much you make

Your income taxes

How you spend/save

Key Determinants

Investment Returns

Factors Impacting

•Career Chosen•Industry/Company Chosen•Career Success, Promotions, etc.•Single or Dual Income Family

•Mix: Ordinary Income vs. Capital Gain•City & State Income Tax Rate•Tax Shelters (e.g. Mortgage interest, depreciation)

•Buy what you need vs. what you want•Pay full price vs. shop for bargains/discounts•Disciplined savings vs. Heavy Credit Card debt•Purchases Increase (e.g. House) or Decrease (e.g. boat, car, clothes) in value over time.

•Educated Investing vs. Gambling (Roll the Dice)•Mix: Conservative vs. Aggressive Investments•Diversification: Stocks, Real Estate, CD, Bonds•Tax: Ordinary Income vs. Capital Gain

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The Door is Open. Will You Enter?

• Invest time to review/use the

tools

to make informed decisions.

• Tell others who might benefit

(friends,

cousins, neighbors, siblings)

Your Future Depends On It

college, career & life planning 1 college student career planning orientation

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