Are gay men discriminated against by employers? Yes, according to a new study which appears in the Journal of Labor Research.

The study, co-authored by Bruce Elmslie, professor of economics at UNH Whittemore and Edinaldo Tebaldi of Bryant University in Rhode Island, contains an in-depth analysis of wage and labor data collected by the U.S. Census in March 2004. The dataset represents over 91,000 heterosexual and homosexual couples.

According to the authors, gay men who live together earn 23 percent less than married men, and 9 percent less than unmarried heterosexual men who live with a woman. Discrimination is most pronounced in management and blue-collar, male-dominated occupations such as building and grounds cleaning and maintenance; construction and extraction; and production.

The authors also found that lesbians are not discriminated against when compared with heterosexual women. They conclude that while negative attitudes toward lesbians could affect them, lesbians may benefit from the perception that they are more career-focused and less likely to leave the labor market to raise children than heterosexual women. According to their study, 18.1 percent of lesbians have children, compared with 49.4 percent of straight women.

Within the study, the authors suggest that employer disapproval of the gay lifestyle, fears about offending customers and concerning the transmission of HIV/AIDS may be affecting hiring and salary decisions. While these are certainly plausible theories, the data they examined does not truly provide any information regarding these potential causes, and more research is needed to justify their assertions.

I believe this study raises more questions than it answers, but the data revealed remains of interest, regardless of the whys.

I’ve long been disturbed that even in 2007, salary and position inequalities still exist between men and women, but until now, I hadn’t realized that homosexual men were affected as well. Gay couples already face unique retirement challenges, and compensation inequities only exacerbate the issue.

Gay men can earn 23 pct less than married men: study [Reuters UK]
New Research Finds Gay Men, But Not Lesbians, Are Discriminated Against in Some Jobs [UNH Media Relations]

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Gay Men Earn 23% Less Pay Than Married Men

When we last met, I was crowing about having paid off $52,050.74 in student loan principal.

I’m still mighty proud of that particular achievement, but this morning, an article from Ignites, an electronic publication available to corporate subscribers only, crossed my path and completely changed my perspective.

The article? Average Portfolio Manager Pay Tops $450K.

At $450,000-some a year, it seems I could have paid off my loans in about ten minutes, instead of ten years. Alas, it’s a long, hard road for those of us who are math-averse.

But maybe there’s a message in this for some of you out there, those of you who have enough of an interest in financial topics to regularly read blogs like this one.

In doing some research, I happened across a Boston-based job listing which shows the sheer earning potential of this type of career. A full-time position requiring a Ph.D in Math or Physics and 7 to 10 years of relevant work experience, it offers $450-600K in total compensation. There are lots more such jobs out there, too, but this one openly lists its salary range. I’ll repost here so you can see what’s involved:

Leading Asset Management Firm in Boston seeks a Sr. Fixed Income Quantitative Analyst. On a daily basis the successful candidate will recommend specific relative value strategies to the PM. Additional responsibilities include: implementation and development of pricing and risk models for cash and derivative products, interaction with Currency and Structured Credit Products analysts and PM’s, and programming in C++ and/or VB. Requires a minimum of 7 years experience in F.I. as a Quantitative analyst on the buyside. Also requires a PhD in Math or Physics in addition to strong communication and leadership skills.

Now there’s a nice payback for a Ph.D! I’m amused because I recall my math-genius brother (someone had to get all the analytical skills in my family) dropping his Physics major in college because he felt there wasn’t much income potential with such a high-flown degree, and university jobs seemed scarce. He switched over to Computer Science, which seemed more lucrative. But I don’t know any CS majors earning over $450K unless they’ve founded their own companies. Sorry, big brother! He got his Masters from Stanford, too.

Those of you qualified for this position should not read beyond this point – you should be applying for the above position posthaste. For everyone else, I’ll give an overview of the Ignites article, since many of you won’t be able to read it directly.

In the article, Kevin Burke details the recent results of a CFA Institute study, finding that equity portfolio managers are the top earners among investment professionals, with an average salary of $456,000 a year. Polling more than 75,000 investment professionals worldwide, they received over 13,500 responses, and learned lots of juicy details about industry salaries.

A CFA news release from Thursday shares some of the facts:

In the U.S., the three highest compensated positions at all levels of experience are portfolio managers (equities) ($456,000), followed by investment bankers ($275,000) and then sell-side research analysts ($195,000). Buy-side research analysts (equity and fixed income) fall in the middle of the pack at all levels of experience.

The pattern for cash bonus is also affected by years of experience. There is little variability in median cash bonus for those with less than five years of experience. However, the gap widens at five to 10 years of experience. At all levels of experience, portfolio managers (equities) ($200,000) and investment bankers ($185,000) reported cash bonuses that are more than double that for most other occupations.

Not just is there a high potential payoff for choosing this career path, but after putting in your five years, the financial outlook keeps getting rosier. Granted, there’s likely some attrition here, with those who aren’t as qualified weeded out while those who are successful begin to see increased rewards and bonuses. After the ten-year mark, the average portfolio manager compensation grows to $499K.

A significant portion of the managers’ compensation comes from performance-based bonuses. Ninety percent of those surveyed were bonus-eligible, and indicated that, on average, bonuses comprise 25% of their overall package. Bonuses can be tied to individual, business unit, and/or firm performance. Some are a percentage of total assets.

The bonus component also means that companies aren’t stuck paying high salaries when the market’s down. So this certainly isn’t a rest-on-your-laurels type job, but there’s ample reward for a job well done.

Unsurprisingly, location also affects compensation, with the highest earners across all levels operating out of New York City, followed by other major metropolitan areas.

Who knew a Ph.D in Math or Physics could be so lucrative? It may be too late for my brother to become a portfolio manager, but perhaps, if you’re seeking a career change, it’s not too late for you.

Image credit: Yomanimus

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Want to Make $450,000 a Year? Become a Portfolio Manager

Today, and every summer through 2009, the federal minimum wage will increase $0.70 an hour. For those working full time at the federal minim wage, the increase to $5.85 an hour will mean an extra $1,400 over the previous rate. This 14% raise is pretty significant, but it still keeps the minimum wage earner who provides for a family of three in poverty.

If minimum wage increases kept pace with inflation since 1970, the minimum wage today would be $8.77. If it tracked inflation since 1956, the wage would be $7.27.

Interestingly, the minimum wage would be $3.39 if 1938’s rate of $0.25 was adjusted for inflation.

Here in New Jersey, the state minimum wage is already $7.15. The state’s economy hasn’t collapsed yet and business owners seem to be getting by. All salaries in the state seem to be somewhat higher than most of the nation. Real estate prices and property taxes are higher, and insurance rates are higher, but gas prices are lower.

Higher minimum wage can be done. Businesses who claim they will have to let employees go or raise prices will do what they have to do to survive and compete, and most likely find a way to make it work without the threatened layoffs. The staggered increases will help these businesses, particularly when compared to an immediate full increase to $7.25.

But is a minimum wage hike just an empty gesture? If minimum wage earners are mostly suburban teenagers from families nowhere near poverty, then a minimum wage hike doesn’t help those struggling in poverty, who most likely work part time at a job a little bit higher than the minimum wage.

Well, it will help indirectly, because those close-to-minimum-wage jobs, like those Wal-Mart, will be buoyed by the wage hike.

The minimum wage hike is necessary but it’s probably not going be the biggest contributor to the mission of making poverty history.

Here’s some historical minimum wage data as well as an inflation calculator, which helped me come up with the adjusted minimum wage rates above.

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Federal Minimum Wage Will Increase Today

Here are the latest figures for average starting salaries.

* Chemical engineering: up 5.4% to $59,361
* Computer engineering: up 4.8% to $56,201
* Mechanical engineering: up 4.6% to $54,128
* Electrical engineering: up 3.2% to $55,292
* Civil engineering: up 5.4% to $48,509
* Computer science: up 4.1% to $53,396
* Information science: up 4.6% to $50,852
* Economics: $48,483 (new to the list)
* Finance: $47,239 (new to the list)
* Information systems: up 4.2% to $47,648
* Marketing: up 6.1% to $40,161
* Accounting: up 2.3% to $46,718
* Business administration: up 3.9% to $43,701
* Political science: up 5.9% to $34,590
* English: up 5.3% to $32,553
* Psychology: up 4.7% to $31,631
* Sociology: up 3.5% to $32,033
* History: up 3.3% to $33,768

Granted that my work location offers salaries somewhat below our New York City counterparts, I get the impression from talking to people in my department that the salaries of people who have been here for a while are on par with these starting salaries, and recent grads might even see something significantly lower. If I were to move to a different department — one that makes money for the company — that may not be the case.

NACE Salary Survey [National Association of Colleges and Employers]

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College Graduates: Starting Salaries Jumped This Year

Hewitt Associates is saying that companies are not planning above average base pay increases in 2008 thanks to rising health insurance costs. This is the same reason I’ve heard over and over again.

Average employees have nothing to look forward to in terms of raises, as perhaps they shouldn’t have. Even above average employees will likely have nothing but a modest increase in base pay. There’s often discussion about how today’s company workers do not remain loyal to their companies for years on end, compared to previous generations of workers who have company loyalty ingrained in their philosophy. But loyalty has to be earned, and corporations must act in a way that shows their employees are their most valuable assets.

Here are some options if you’re not expecting an above-average pay increase but are happy in your current position.

Two options for changing the company’s behavior:

Negotiate a higher bonus. Companies are starting to prepare their budgets for 2008. If you are a star performer — or if you just finished working on a successful project that has benefited the company in some way — now is the time to schedule a meeting to remind your boss of your recent accomplishments. While salary is a fixed cost for a company, there may be more room for negotiating one-time expenses like bonuses.

Negotiate something else. Working from home one day a week may save wear-and-tear on your vehicle, money for gas and tolls or mass transportation, and time. If this is a possiblity for you, find out if your company will approve it. Perhaps more vacation time would be a negotiable point.

Three options for changing your own behavior (giving yourself a raise):

Make fun money. Don’t rely on a company to provide you with more money. Find a way to make some extra money with your favorite hobby or activity. If you like what you do at work, do some related consulting on the side (steering clear of relationships conflicting with a non-compete agreement you may have signed at one point).

Revisit (or create) your budget. There are two reasons to want more money from your job — to save more for the future or to pay for increased expenses. Cut back on unnecessary expenses — perhaps expanded digital cable with premium channels or super high speed internet. Deposit the saved money into savings automatically each month or use it for a necessary expense. If you’ve never created a budget before, give it a try. You may be able to locate “lost” money on a monthly basis.

Adjust your withholding. If you find that you, like many households, receive a tax refund from the government every April, perhaps you would benefit from adjusting your withholding to be able to keep that money as you earn it. This way you’re not giving an interest-free loan to the government, and you have use of your money for paying expenses or investing. Use this withholding calculator to determine your optimal exemption amounts.

Whether or not your employer pays you more, your expenses will go up year after year (if not controlled and reduced) for any reason other than inflation and the second law of thermodynamics. The difference has to come from somewhere, and hopefully the solution does not involve the depletion of savings or the use of credit.

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Don’t Expect a Big Pay Increase: Other Options

If you’re reading this blog, the answer to the question in the title is, “Probably not.” Perhaps a better question is whether you can live on the mean incomes provided by the occupations on Forbes’ 25 Worst-Paying Jobs. As I said when commenting on the top 25 jobs, the “mean” calculation is often meaningless as it doesn’t give a full story of a wide range of incomes. Nevertheless, it’s an interesting statistic for starting discussions.

* Combined food preparation and serving workers, including fast food: $15,930
* Cooks, fast food: $15,960
* Dishwashers: $16,190
* Dining room and cafeteria attendants and bartender helpers: $16,320
* Hosts and hostesses, restaurant, lounge, and coffee shop: $16,860
* Counter attendants, cafeteria, food concession, and coffee shop: $16,950
* Gaming dealers: $17,010
* Shampooers: $17,050
* Waiters and waitresses: $17,190
* Ushers, lobby attendants, and ticket takers: $17,500
* Amusement and recreation attendants: $17,530
* Farm workers and laborers, crop, nursery, and greenhouse: $17,630
* Cashiers: $17,930
* Personal and home care aides: $18,180
* Lifeguards, ski patrol, and other recreational protective service workers: $18,410
* Parking lot attendants: $18,450
* Pressers, textile, garment, and related materials: $18,470
* Food preparation workers: $18,480
* Bartenders: $18,540
* Graders and sorters, agricultural products: $18,610
* Maids and housekeeping cleaners: $18,700
* Cooks, short order: $18,710
* Child care workers: $18,820
* Laundry and dry-cleaning workers: $18,890
* Service station attendants: $19,150

Food service seems to be one of the biggest industries for low-paying jobs. Since the survey did include part-time wage earners, it’s possible these salaries are skewed downward by jobs requiring less than 40 hours of work each week. Have you ever worked in any of these positions? I’ve never worked in any of these industries. My retail job for one spring break in high school (Radio Shack) isn’t included above.

Feel free to share your experiences.

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Is Your Job on the Bottom 25 List?

Here’s a list on which you won’t find “senior accounting associate.” It’s the 25 best-paying jobs, in terms of base salary in 2006 of salary and wage workers, not including the self-employed. Here are the top 25 along with their mean salaries, from Forbes.

* Anesthesiologists: $184,340
* Surgeons: $184,150
* Obstetricians And Gynecologists: $178,040
* Orthodontists: $176,900
* Oral And Maxillofacial Surgeons: $164,760
* Internists, General: $160,860
* Prosthodontists: $158,940
* Psychiatrists: $149,990
* Family And General Practitioners: $149,850
* Chief Executives: $144,600
* Physicians And Surgeons, All Other: $142,220
* Pediatricians, General: $141,440
* Dentists, General: $140,950
* Airline Pilots, Copilots And Flight Engineers: $140,380
* Podiatrists: $118,500
* Lawyers: $113,660
* Air Traffic Controllers: $110,270
* Engineering Managers: $110,030
* Dentists, All Other Specialists: $108,340
* Natural Sciences Managers: $107,970
* Marketing Managers: $107,610
* Computer And Information Systems Managers: $107,250
* Sales Managers: $102,730
* Petroleum Engineers: $101,620
* Financial Managers: $101,450

Financial managers are the newest addition to the top 25, replacing astronomers. The medical industry seems to have a stranglehold on the top 20, and these are jobs that require extensive, expensive education. On the other hand, marketing managers and sales managers are on the list. If you’re looking for that six-figure salary without a required six-figure education, these options are available. Actually, both of those jobs — sales and marketing — have something in common: their success requires the skill of convincing people they need something they don’t.

That’s a bit of a simplified point of view; of course there is much more than that necessary to be the best sales manager or marketing manager, but the industries are based on understanding people — a skill that one might not be able to glean from a six-figure education.

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Is Your Job One of the Top 25?

Recently, Mapgirl’s 401(k) balance surpassed the $20,000 balance milestone. That’s not small accomplishment for less than two years on the job. For comparison, I’ve been investing in my 401(k) for more than five years now, and my balance is only approaching $40,000 including company match. I started investing only 4% of my salary and have recently increased to 25%, which I can only do thanks to other income.

It’s interesting to see how companies use future payoffs with the intent of retaining employees. For example, when I became fully vested in my company match, after working at the company for three years, I felt better about the possibility leaving the company. If I had quit at two years and 350 days, I would have missed out on thousands of dollars in company match. It wouldn’t make much sense unless I could negotiate a new job offer for a higher salary to take that into account.

Following this thought process further, if I could negotiate a higher salary or other benefit for that reason, I should be able to do so for any reason, making it again a loss to leave before fully vested.

Within a year after becoming fully vested, the company presented a new carrot for its employees: an associates stock grant. A good amount of stock was given to employees but the shares wouldn’t vest until 2009. At the time, it was pretty far in the future, so it’s a part of compensation that would be easily to forget about while negotiating a salary at a new job.

Are you less likely to look for new work if leaving your current company would mean leaving money on the table?

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Fear of Throwing Money Away Keeping You From Quitting?

A study by a group of research organizations have determined that men in their thirties are earning less, when adjusted for inflation, than their fathers earned in their thirties. Studies like this help to explain the reported financial condition of younger households throughout the United States.

Relying on Census Bureau figures, the study’s authors found that after adjusting for inflation, men in their 30s in 2004 had a median income of about $35,000 per year, for a 12 percent drop compared with $40,000 per year for men in the same age group in 1974… Similarly, American families, which experienced a 32 percent increase in income levels between 1964 and 1994, saw household income growth slow to 9 percent between 1974 and 2004, according to the report. (CNN Money)

I’ve heard people say that every generation will be better off than their fathers thanks to economic progress, but this doesn’t seem to be true at the moment for those in my age group. Perhaps the relative income stability of our father’s generation allowed those in my generation to pursue interests that aren’t as income-driven.

Any thoughts?

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American Men Earning Less Than Dad

Mother’s Day is approaching, which means you’re going to start hearing about a certain survey in noth the traditional and the “alternative” media. The paycheck comparison website, Salary.com, creates a questionnaire each year to determine the value of the work a mother does for her family. By determining the ten most popular “jobs” a mom does — chief executive officer, van driver, janitor, etc. — and weighing each job’s media corporate salary against the percentage of time spent doing that job, Salary.com determined that if a stay-at-home mom was paid a fair salary in 2006, it wold be $134,121.

This year, moms received a raise and the figure is now calculated at $138,095.

I pointed out this rebuttal last year, but it’s worth repeating. Carl Bialik from the Wall Street Journal thinks it’s ridiculous.

Claudia Goldin, a professor of economics at Harvard, dismissed the survey as “silly.” “The calculation isn’t for what anyone would pay an individual,” Prof. Goldin said. “Nor is it for exactly what the individual does. It is for what the person claims they are doing during a long day — CEO, psychologist, etc. And what exactly is the salary for the CEO of a business that shows no profits and sells no services or goods? I think it is probably zero…”

There are other problems with the estimate. A big one is that mothers aren’t trained as professionals for some of the jobs, like computer operator and cook, so their work in those areas may be overvalued at the typical hourly salary.

If you want to check out how much your mom is “worth,” visit the Mom Salary Wizard. This is the 2006 version. I guess the 2007 data has not been officially released yet, but you can estimate by adding 3% on to your result.

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How Much is Your Mom Worth?

Jeanne Sahadi over at CNN Money is spilling the beans again, and this time it’s about salary. Your managers know these precious pieces of info, but you might not. Armed with this knowledge, you could be better poised to tip the scale in your favor next time you negotiate. Here’s the summary.

1. Secret: Your pay doesn’t necessarily reflect performance and seniority. If new hires are getting paid as much as you with your extensive experience, it might be time to mention this and push for a realignment.

2. Secret: There’s more raise where that came from. Your managers will tell you there’s only so much cash available, but they’re usually lying. There is a reserve for those who the company does not want to lose. If you’re one of those people, use it to your advantage.

3. Secret: When you’re told they can’t pay you more now, budget may not be the issue. Your boss may not think you’re worth that much, he may not have tha uthority to make the decision, or you’re already at the top of the pay scale.

4. Myth: Your pay is all about you. Compensation is determined by consultants and surveys. At my company, a “market reference range” is established for each position which describes a range that includes the middle 50% of people working at that position, supposedly.

5. Myth: Bosses pay more if they like you. It’s not that their admiration is the reason for a higher pay. The qualities that allow someone to be paid more are the same qualities that the boss likes.

6. Myth: You can’t negotiate severance. If the company needs something from you, like your knowledge, before you leave, you are in a good position to ask for more than the standard severance package (if there is one).

I’ve been at my current position now for six months, and I started at a salary lower than I thought I deserved because I was a little anxious to get to a better mental state. I’ve continuously added responsibilities and I’ve received good feedback; perhaps I should start putting the right thoughts in my manager’s mind well before the annual review at the beginning of 2007.

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Secrets and Myths About Salary Your Employer Doesn’t Want You to Know

There are no fancy introductions here. Getting right down to it, the average salary for Wall Street is $289,664, while the average for all of New York City is “only” $56,634.

The Reuters report includes more money figures, but the only piece I find particularly interesting is the average bonus per person: $125,000. My bonus last year was a partly 2% of that amount.

There are a few at the top of the scale whose salaries and bonuses skew the average (mean) higher than the median.

On the topic of salaries, I had a successful interview prescreen (over the phone) for a position in New York (but not Wall Street), similar to what I’m doing now, albeit with fewer responsibilities. The expected salary mentioned by the HR representative is a good $10,000 more than what I’m earning now.

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Wall Street Salaries are Through the Roof!

If you’ve been wondering why your average raises over the last few years haven’t helped you get ahead, it’s because, as the New York Times reports, real wages (after factoring in inflation) have actually declined 2% since 2003. Apparently, the last time this has been the situation was during Wolrd War II.

The drop has been especially notable, economists say, because productivity — the amount that an average worker produces in an hour and the basic wellspring of a nation’s living standards — has risen steadily over the same period.

So why are people working harder but getting paid less after inflation? It’s not because total compensation including salary and benefits beat inflation. In fact, it didn’t.

Over the last year, the value of employee benefits has risen only 3.4 percent, while inflation has exceeded 4 percent, according to the Labor Department… Average family income, adjusted for inflation, has continued to advance at a good clip… But these gains are a result mainly of increases at the top of the income spectrum that pull up the overall numbers. Even for workers at the 90th percentile of earners — making about $80,000 a year — inflation has outpaced their pay increases over the last three years, according to the Labor Department.

The above is interesting. The result is you’ll hear politicians talking about average income increasing, but that’s due to increases seen by high-income earners ulling the average higher. The average family will not see these average income increases.

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Your “Real” Raise

I apologize for not having much to write today. I’m sure there is much to write about, but today and the next few days I expect to be swamped with work in the office, where I realized that thanks to no overtime being offered, despite an 8% higher salary this year, I’m making less money each month than before the promotion/relocation. C’est la vie.

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Busy Day at Flexo’s Place of Work-ship

All you have to do to earn $42,000 a day, or $11 million each year, is be average.

Wait, when I say “average,” I mean “average CEO.” That’s not so hard to do, right? In 2005, if you were the average CEO, you made 262 times what the average worker made, $41,861 anually.

Critics of CEO pay contend that the compensation committees of publicly traded companies too often fail to tie pay to performance.

CEOs make this kind of money because companies are willing to pay. Shareholders must believe they are worth the big bucks, otherwise they’d vote to change the Board of Directors, right? So this is just the free market at play… maybe.

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How You Can Make $42,000 Each Day

I’m a little concerned. I’m making more taxable income this year outside of my full-time job, but my tax withholding was calculated based on only my full-time income. Last year I had a few thousand dollars extra income, but I was able to use related expenses and my SEP IRA to offset a good portion of that. With the web-based busienss picking up this year, I need to do something to make sure I won’t end up with a hefty IRS bill next year.

I plugged some estimated numbers into the IRS’s withholding calculator, which determined I should set my withholding exemption level to 0 and freely give to the government $150 each paycheck in addition. I wasn’t completely comfortable with that number, so I adjusted my full-time withholding to level 0 plus an extra $50 each paycheck.

This just means that I’m going to have to use some of my side income towards expenses rather than just leaving the bulk of it in savings. Starting next month, I’ll transfer 50% of my additional income into my active accounts to help pay for regular expenses.

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Updated My Federal Tax Withholding

This is an interesting article from the New York Times. Research shows that your first job dictates how much your income will be your entire working career.

The recent evidence shows quite clearly that in today’s economy starting at the bottom is a recipe for being underpaid for a long time to come. Graduates’ first jobs have an inordinate impact on their career path and their “future income stream,” as economists refer to a person’s earnings over a lifetime.

Let’s put this in perspective for me. Here are the jobs I had, after finishing my undergraduate degree in music education:

* 1999: Substitute music teacher in a low-paying district: $70/day
* 1999: Summer job: driving a van for a drum and bugle corps 12,000 miles over seven weeks: $500/wk
* 1999-2001: Associate Director, Scholastic Services of a non-profit organization: $28,000/yr with 3% increases
* 2002-2004: Temp to permanent administrative associate at my current company: started at $34,000 plus bonuses, overtime, etc., with average yearly increases
* 2004: Taught high school music for one semester, remaining part time at current company: $40,000
* 2004-2006: Returned full-time to current company: currently making $42,800 plus bonuses, overtime, etc.

When I returned to my current company in 2004, I took on a new position (accounting) with which I had basically no experience. I seem to have adapted well considering I was awarded by latest position.

According to this article, my salaries dictate how much I’ll make throughout my career. Finishing up my master’s degree will give me a boost if I change jobs again. Salary was never a motivation for me originally; otherwise I wouldn’t have chosen to study music education. Even if doing so is making it more difficult for me to get ahead, especially in this area of the country, I wouldn’t change anything given the chance.

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Don’t Get Ahead, Start Ahead

A feature on MSN Money looks at finances of people in their twenties. The feature includes statistics such as median net worth, median income, percentage owning homes, etc. with which you can compare yourself if you happen to be in this particular demographic.

At age 29, I was doing well compared to these averages, but now that I’m in my thirties — 30, to be exact — I likely don’t stack up well against thirtysomethings.

Here are the article’s tips for those in their twenties. The headings are self-explanatory, so I won’t go into detail:

* Live cheaply as long as you can.
* Get health insurance.
* Shovel money into your retirement funds.
* Take a chance (regarding asset allocation).
* Be strategic about debt.
* Pay attention to your credit score.

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Money Stats for Twentysomethings

Earlier this month, Personal Finance Advice and others reported on a study by Salary.com saying that a stay-at-home mom’s job is equivalent to an amalgamation of many vocations that would together provide an annual salary of $134,121.

Carl Bialik, the “Numbers Guy” at the Wall Street Journal calls foul.

The Wall Street Journal likely emailed this story to hundreds of bloggers, so I’m sure you’ll hear more about it, while other bloggers will ignore it a piece of mass-email (or spam). I wanted to share the link because I enjoy when individuals dispute studies that quickly become widely accepted.

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The Worth Of The Job Of Mom: Faulty Study?

Here’s another article on the outrageous pay given to CEOs even when their performance is subpar. Last year, there were five specific offenders singled out. Today, there are five different companies, and drugs are on top:

* The CEO of Pfizer, Henry McKinnell, made more than an average of $15.5 million a year while the company’s shareholders lost 35% over the past five years. His pension is worth $83 million.
* Merck’s shareholders lost 41% in the past five years while former chief executive Raymond Gilmartin totalled $54 million including his company stock as he cashed it out.
* Edward Whitacre was the chairman and CEO of SBC and now AT&T. He earned $85 over the past five years, and will earn millions more in consulting fees and pension from the company after he retires. In those five years, shareholders have lost 40%.
* Shareholders in Bell South lost 23% while its chairman and CEO F. Duane Ackerman made $46 million.
* Safeway’s CEO Burd earned $52 million in the past five years. His company’s stock has plunged 54% in the same time frame.

If there’s any good news in this, it’s that after five years of decline, now that I’ve invested $50 in a telecommunications ETF, perhaps the sector will start climbing upwards. Drug companies are everywhere in my index funds. But seriously, CEOs are supposed to increase the company’s value for shareholders. These guys should be fired, not rewarded.

The only other possibility I can think of is similar to the movie The Hudsucker Proxy, in which a board of directors installs who they think is a moron to the post of CEO in an attempt to drive down the stock price to a point where the board can snatch it up and later return the company to its former glory. These CEOs must be getting paid well for playing their part in the grand scheme.

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Even Lousy CEOs Get Great Pay

Once again, I’m finishing up my MBA in the next few months. Fortune has come out with a list of the companies most sought-after MBA candidates. Here are the top ten:

1. McKinsey & Company
2. Google
3. Goldman Sachs
4. Bain & Company
5. The Boston Consulting Group
6. Citigroup
7. Apple Computer
8. General Electric
9. Johnson & Johnson
10. Morgan Stanley

Not a bad group of companies. There are some interesting companies down the list that I wouldn’t have thought would have interested as many MBA recipients, including Disney, Gap, and Wal-Mart.

The Fortune Magazine feature also provides results from a survey in which prospective MBAs forecast their starting salary. The average expected starting salary is $88,087 and their predicted salary after five years is $167,052. Within those averages, men are predicting much higher salaries for themselves than women.

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Top MBA Employers

The CEO of my company announced today that the board approved a special bonus payment. All full-time employees will be granted about $2,000 worth of restricted stock units, which will vest on March 14, 2009. On that date, each unit will convert to a share of stock and will be available to sell.

It’s not a bad deal, unless someone leaves the company before 2009. I’m not a fan of having benefits tied to company loyalty.

The Consumerism Commentary Podcast is in full swing with new episodes every Sunday. Listen and subscribe now!

Company-Wide Bonus

Here is one of the best arguments for moving where cost of living is low. This comes from a Jeanne Sahadi-penned article at CNN Money. She is discussing the issue of middle class status in various regions and how those living a “middle class lifestyle” pay significantly different taxes.

A dual-income couple without kids and an AGI of $74,443 in Milwaukee can afford a median standard of living, according to the Tax Foundation report. That still puts the couple in the top 20 percent of taxpayers, giving them a tax liability of 8,081, or about 10.9 percent of their AGI (otherwise known as their effective tax rate).

To afford the same standard of living in Orange County, California, the couple would need an AGI of $100,079, putting them in the top 10 percent of taxpayers with a tax liability of $14,506. That represents 14.5 percent of their AGI.

And if they move to New York City, they’d need an AGI of $162,974, putting them in the top 3 percent of taxpayers and giving them a tax bill of $31,139, or 19.1 percent of their AGI.

Is this reason enough to convince people to move away from metropolitan regions like Los Angeles and New York? Perhaps it is for some people. There are benefits to living close to international hubs, including exposure to diverse culture, proximity to the best music, art, and food in the world, and large, close-knit communities and subcommunities. For some people, this is worth the extra expense.

The Consumerism Commentary Podcast is in full swing with new episodes every Sunday. Listen and subscribe now!

Move Where Cost of Living Is Low

I mentioned in the notes for my latest balance sheet that I’ve received my yearly raise and bonus. Here are some details.

My bonus appears in today’s paycheck. My “2005 Annual Incentive Award” amounts to $2,848, or 7.18% of my 2005 base salary. Note than I am a “non-exempt” employee and I get paid for overtime in addition to the salary and bonus. In 2005, I earned over $6,000 for working overtime.

My raise, which is activated for the next pay period, leaves a little to be desired. My base pay is increasing by $1,100, or 2.77%. It’s the lowest raise I’ve received at this company despite 2005 being my “best year.” Supposedly all raises and bonuses are low this year in anticipation of a new company stock purchase plan which will be offered to all employees sometime later.

Thankfully, my day job is not my only source of income.

The Consumerism Commentary Podcast is in full swing with new episodes every Sunday. Listen and subscribe now!

Pay Increase Details

In a number of professions, the average salary for women is higher than the average for men. CNN is listing 39 of the 80 such professions discovered by the author of Why Men Earn More: The Startling Truth Behind the Pay Gap — and What Women Can Do About It. If you look at the “female advantage” of each of these professions, the ones at the top are sales engineers (women earn 43% more than men), statisticians (35% more), and legislators (33% more).

The accompanying article makes some generalizations and justifications in order to determine the reason behind this situation.

* In a male-dominated field, a company may be willing to pay a premium to hire a qualified woman.
* The combination of people skills and technical skills is in demand.
* There are career programs designed to advance women.

Relatedly, I wrote about the differences between men and women in regards to salary negotiations last year.

The Consumerism Commentary Podcast is in full swing with new episodes every Sunday. Listen and subscribe now!

Women Earn More Than Men