top of page

They kept asking about what I wanted to do with my life, but what if I don't know? - Part 1

Updated: Oct 7, 2022

This article is about career choices and their impact on wealth. We clarify the path through the complex web of skills, abilities, attitudes, occupations, and industries to optimize your personal finance journey.

This article challenges two common perceptions:

  1. We may think of job and career choices separately from personal finance. We may consider career decisions based on our skills and abilities. We often see wealth-building implications separately and as a career decision outcome. We may not think of our career decisions as an adaptable input to our personal finance success.

  2. We often think of personal finance in the context of technical decisions about securities to purchase or portfolios to manage. We may not think of personal finance in the context of our attitudes, cognitive biases, and discipline.

This article provides fresh insight, relating our career choices to our personal finance success.

This article is presented in the following sections:

Part 1:

  1. Foundation - our attitudes and behaviors

  2. Career segments and making job changes

  3. Notes

Part 2:

  1. The three long-term value segments - building the personal finance arbitrage

  2. The personal finance arbitrage outcome

  3. Conclusion and Notes

A little further in the article, we will introduce Liam, Mia, and Bob. They represent three people that, on the surface, seem pretty similar. They are about the same age, have similar educational backgrounds, and live in the same city. However, we will show that Liam, Mia, and Bob will end up with very different wealth outcomes.

This article makes the case that our career decisions, especially our behaviors and beliefs informing those decisions, have a tremendous impact on our personal finance success. We show how to actively make career decisions that build our wealth and attendant financial security. We demonstrate personal finance success arbitrage via a straightforward financial model.

1. Foundation - our attitudes and behaviors

Before we dig into the career segments, we will discuss some of the underlying attitudes and behaviors that power our career segment decisions. This usually starts when we first enter the workforce, post our primary education. This could be after high school or college. It does not mean you completed your education, but it is usually a transition point into the working world. It is often a time when the industry decision is first made. This is a key point. It does not mean you can not change your mind. However, as you get more senior, your degrees of freedom may shrink in terms of available industry options. Especially if you wish to stay on the same or higher compensation level.

I often see career decisions made in terms of "skills I have" and "tasks I like." This could be limiting. Instead, I suggest making decisions based on "skills in demand" and "missions I believe in." Skills can be developed and you can learn to like many tasks.

In terms of skills: Position yourself to learn skills you believe are in demand. This is started during your primary education and choosing a major field of study. Skills are enhanced and deepened with experience and continuing education. For example, Data Science and Statistics are very hot today. You may say to yourself, "I do not like data science much." Well, now is a good time to learn to like data science! [i] Change your attitude. Take classes, network with people in the field, and learn how to position yourself to be credible in the data science space. The psychologist Carol Dweck would say this "change your attitude" approach is part of a "growth mindset," which Dweck defines as believing your abilities are largely the product of your effort - that you can grow to the extent you are willing to work hard and learn. [ii] My research-backed experience (more below) suggests that you can learn to like something when you get positive feedback. You get positive feedback when you do something well. You may say, "I'm not good at math." This is a short-term attitude. Not a long-term reality. The reality is that the human brain is incredibly adaptable, which is sometimes referred to as ‘neuroplasticity.’ For example, you may have knowledge gaps generated from missed high school math concepts. Now is a good time to leverage your neuroplasticity and fill the gaps. With all your other experiences, the good news is your brain will relatively quickly build math understanding, but only if you train it AND have a positive attitude. Data science is only one example. We provide resources in this article for many in-demand occupations. Choose one that looks interesting. Later in the article, we describe a framework for getting the most out of high-demand occupations. For a more in-depth example of applying data science-informed skills by non-data scientists, please see our article: Do I need to be a data scientist in an AI-enabled world?

Beyond neuroplasticity, our neurotransmitters provide direct emotional input. Conceptually, think of neurotransmitters as an emotion-enabled information tag, attached to each sensory input. The point at which you are practicing, learning, or otherwise improving a skill is a point of sensory input. The neurotransmitter significantly impacting “liking” is dopamine. [iii] The more you receive positive feedback, the more dopamine is engaged in liked brain activities. Dopamine is a feel-good reward transmitter that encourages people to do more of the liked activity. This is why you feel good about doing activities you are provided positive feedback. This creates a positive feedback loop and is a key life success driver:

  1. The more you practice, the better you get;

  2. The better you get, the more positive feedback you receive;

  3. The more positive feedback you receive, the more you feel good and want to practice.

  4. And the cycle continues...

This suggests: Seeking academic majors and building skills that lead to careers in economic demand. “Liking” will generally take care of itself via economic demand-enabled feedback. Also, liking may come from yourself. Being positive and giving yourself credit for your accomplishments is important to building your own dopamine reservoir. Learning from your mistakes is important, just do not beat yourself up. The most significant learning often comes from mistakes. Learn, give yourself credit for the learning, and move on. Dwelling on past mistakes is contrary to learning.

Please note: Social media platforms understand the neurotransmitter dynamic VERY well. The dark side of dopamine is addiction. Dopamenic process manipulation is the basis for social media, gambling, smoking, and related like-based, dopamine-targeted business models. In this case, the feedback is geared toward the social media companies’ revenue generation. This does not necessarily benefit the customer. A former Google design ethicist provides an important warning:

"If you are not paying for the product, you are the product."

- Tristan Harris mentioned this quote in the documentary film The Social Dilemma.

This suggests being intentional with your likes is very important. Your brain is listening!

Please see the BLS chart and website provided earlier for more skills and related occupations. Also, please see our articles:

  • Success Pillars for more information on driving success by maximizing luck with an adaptable mindset.

  • Brain Model for more information on different mental pathways and the interactions of our brain's major functional areas.

In terms of mission: An important decision element includes why you want to work for a particular company. Your personal mission and the company mission should be aligned. The basis for focusing on why comes from a powerful, but non-verbal part of your brain. That is the "high emotion & low language" pathway as described in our Brain Model. Your neurotransmitters provide the tagging feedback for your mission because it is often an emotion-based and value-focused mental input. This is related to the dopamenic mechanism as discussed earlier. Information containing a high emotion tag will get routed through the low language-based right hemisphere. Low language makes it very difficult to interpret the feeling. So getting mission alignment right becomes very important. Misalignment of the mission may cause you stress and a "nagging feeling something is not quite right but you cannot put your finger on it" kind of sensation.

University of Chicago Behavioral Scientist Sendhil suggests most people think they are choosing between employers, say, Company A and Company B. What they are actually choosing is their future self and who they will become. That is, in the future, they will become like the people in their chosen company, either Company A or Company B. We are so adaptable, that we cannot help but become similar to the company we choose to keep. So choose your future self wisely by focusing on the mission. [iv]

Develop your own mission statement. Do you want to help people? Do you want to be in creative environments? Do you get excited about driving economic success? Do you want to be part of an environmentally friendly organization? Do you think data is cool and want to help use it to create value? Getting excited about the company's mission is positive reinforcement. It will be key to "liking" whatever task you are assigned. There is a strong neurological connection between the mission and the task. As such, you can find ways to like most tasks, as long as you are bought into the mission.

To summarize, it is the mission that is important to like, more so than skills or tasks. Skills can be acquired and utilized in your high language cognitive or left-hemispheric processes. You can learn to like skills and tasks with positive feedback. Start with the mission and build skills to execute the mission.

To dig deeper, we provide the framework for how Skills and Mission respectively relate to Noise and Bias. That is, biased mission alignment may lead to a less accurate outcome. Alternatively, noisy or inconsistent skills lead to a less precise outcome. Skills-based noise, while taking some time and effort, is easier to solve than accuracy-lacking bias. Please see our notes for more context, including a dartboard-based metaphor. [v]

Also, being clear about your mission will help you decide when it is time to change jobs. There are many reasons to change jobs. As we will discuss below, a job change may result from better monetary opportunities with more responsibility. But sometimes, especially when you get later in your career, a job change may occur because your mission goals become misaligned with your employer. See our article Changing Our Mind for more information about the methods of changing our minds, especially related to your career.

2. Career segments and making job changes

To help further build on attitudes and behaviors, the above graphic shows 3 segments based on 2 important career dimensions. In part 2, we provide a more fulsome description of the segments, as represented by our fearless personas - Liam, Mia, and Bob. Before we dig into the segments, we will describe their defining career dimensions.

Career Risk Personality - Risk-averse or climber?

First, let’s start by defining the Career Risk Personality. We all have a career risk personality that drives our career progression. Our adaptability and how we handle uncertainty is often the key driver of our career choices. A person able to appropriately evaluate and move forward in the face of uncertainty shows “climber” tendencies. One that is less able to move forward in the face of uncertainty shows “risk-averse” tendencies. Our willingness to change companies is often a significant driver of our compensation as salary jumps are generally higher when changing companies. Career Risk Personality is a big deal, as our models will demonstrate later in the article. To be clear, I consider Career Risk Personality a learned behavior, not some genetic destiny. Our starting point will likely be the result of how we are taught in childhood. As an example, Reshma Saujani, founder of Girls Who Code says:

"We're raising our girls to be perfect, and we're raising our boys to be brave"

Ms. Saujani suggests women may be more likely to fear uncertainty because of how our daughters are raised. Naturally, this is a generalization based on Ms. Saujani’s experience, your experience may be different. The point is - if desired and with some work - we can all adapt our Career Personalities.

The French philosopher Voltaire said:

“Perfect is the enemy of the good.”

In this case, “Perfect is the enemy of making more money!”

For more information, including an empirical study demonstrating the impact of matriarchal and patriarchal cultures, please see our article: How braver people, especially our daughters, achieve more career success.

Understanding how employers manage Career Risk Personality and related policies is important to your long-term value creation opportunity. For new employees, companies offer salary increases as a job change incentive. For current employees, companies often mute their ability to adapt to the current market salary. This “current employee - mute” or “new employee - increase” is accomplished by HR or Finance corporate policy. Many companies have broad job category salary ranges to accommodate new employee salary increase incentive needs, but that does not require them to increase current employee salaries to current market levels. As an example, here is a quote from May 24, 2021, in The Economist article called “Why paying a pittance is passé.” Notice, average current workers will not be caught up until 2024, whereas new employees get an immediate increase:

“…entry-level wages for new hires would go from $11 to $17 an hour and that average wages for all staff would reach $15 by 2024”

Lagging current employee salaries is a standard Finance / HR department business management approach to both increasing wages to attract new hires and lagging the increase for existing employees to protect profitability. Lagging or even reducing salaries is more likely in firms with professional business managers from MBA schools. MIT economist Daron Acemoglu shows in a recent paper that companies with professional business managers are more likely to decrease salaries. Even though, over the period of study, total firm value creation does not increase. [vi]

Some of the underlying factors driving lower wage growth within the same company are:

  1. Information Asymmetry - the employer has more information than the individual employee or job seeker, and

  2. Market Subjectivity - your market salary can be subjective and not always easy to determine.

  3. Employee Inertia - companies rely on a “fear of change”-based inertia to reduce the need to adjust current employee salaries.

As such, changing companies to improve your salary by adapting to market inefficiencies is an employment market strategy arbitrage. Those that are willing to arbitrage their skills and abilities [vii] have a great opportunity to create wealth. We will show the value of this arbitrage later in the article.

Industry - High Growth or Mature?

We also have the choice of different industries for our careers. This is significant as our employment value becomes more industry-specific as we become more senior. Our ability to switch industries and increase salary may decline as our value becomes more industry-specific. Making a good industry choice regarding growth opportunities will make a difference in your long-term salary and wealth-building ability. As we will show in our models later in this article, ”high growth” industries drive more long-term personal wealth than “mature” industries. The U.S. Bureau of Labor Statistics (BLS) has a treasure trove of information regarding industry growth.

By the way, in 2022, the pandemic is forcing many to rethink their industry choice. The U.S. has and will face labor shortages as market demand moves faster than people can change industries. This friction may create salary inflation. As said in a recent The Economist article [viii]:

“It takes time for people to move from dying industries to growing ones.”

For those thinking of an industry or company change, the pandemic may represent a once-in-a-generation opportunity. In fact, the U.S. job turnover rate has been accelerating, with the average turnover rate now being below 2 years. This means that if you are not changing jobs every 2 years, you are not changing jobs as quickly as the U.S. average. [ix] The point is, job change consideration should be a standard part of a healthy life evaluation. Also, another way to think about a growing industry is in terms of its compensation upside compared to its downside. See our article Why convexity is a helpful career guidepost for an approach to considering upside and downside when evaluating an industry or company.

Next comes the arbitrage opportunity. To describe the arbitrage, we answer the question: "What are the potential personal finance implications regarding the different career segment choices?" I call this an arbitrage, because you have the opportunity, especially when you are younger, to make high-value career decisions. In effect, you are buying your skills out of a lower-value career market segment and selling your skills into a higher-value career market segment. This is the essence of a classic arbitrage trade. As such, the following analysis helps you understand the long-term value opportunities based on three different persona segments.

Next, we meet Liam, Mia, and Bob….


[iii] The brain is incredibly complex. There is significant interaction between all the components of the brain, including neurotransmitters - like dopamine. For a related practical example, see our article on how our brains engage the political process.

Hulett, Your vote does not matter as much as it should!, The Curiosity Vine, 2021

[iv] Levitt, Interview with University of Chicago Behavioral Scientist Sendhil Mullainathan, People I Mostly Admire Podcast, 2021

[vi] Background: Dr. Acemoglu and the co-authors' paper is most interesting. The paper suggests a correlation and causation between companies hiring MBA school professional managers and decreasing salaries. They suggest their approach establishes a higher standard of causality. This means the authors assert that it is the MBA school training that caused wages to go down. I have a related but different theory. My behavioral economics training, including experience with availability bias, suggests a more subtle causal reason to investigate.

There is an old management saying: "Inspect what you expect." The idea is, via active inspection, that business leadership is sending a clear message about what they expect through regular monitoring. In my experience, this is a useful tool to drive performance for that which is inspected. The background for this comes from behavioral economics. Availability Bias is a powerful decision-making bias. It has to do with salience. Research consistently shows that the most salient decision inputs are going to be more available to the decision-maker. Thus, more available decision inputs are likely to be overweighted in the decision-making process.

Thus, the theory to explain the impact of MBAs on wages is this:

Situation: Via their education, MBAs are given a bunch of tools, which include managing expense lines. This training enables reducing factor input costs, including labor costs. But in recent decades, MBAs are also taught "Stakeholder Capitalism" which combines the needs of the shareholder, along with the customer, the employee, and the community. So, I think it is a stretch to blame MBA schools. This would be like blaming a toolbox for the misuse of a hammer.

Then, what else could be a root cause of MBAs association with lower wages? To start to unpack this question - the U.S. S.E.C. requires quarterly reporting and even private companies often follow a quarterly reporting cycle. The reporting is short-term and focused on the Income Statement (Revenue and Expenses) and Cash Flows.

Complication: The MBA graduate certainly has extensive training in U.S. S.E.C. required reporting for public companies. The quarterly reporting makes expense lines and cash impact, like labor costs, VERY SALIENT to the professional business manager. However, longer-term outcomes impacting the customer, the employer, and the community are much harder to see, thus much LESS SALIENT for the professional business manager. Therefore, the professional business manager MBA will focus on what he can control and what is most salient to demonstrate their value (like squeezing labor costs and improving cash availability). It is much more challenging and less salient for the professional business manager MBA to focus on the other longer term and harder to see stakeholders' value metrics. Also, professional managers often have incentives to drive short-term profitability. Think of incentives as "salience enhancers" that increases availability bias.

Thus, my theory involves our naturally occurring availability bias. It is the availability of wage expense information via U.S. S.E.C. required and related quarterly reporting that are a root cause of MBAs overweighting these decision inputs. The outcome of overweighting salient decision inputs drives short term profitability and cash availability, but likely does not drive other stakeholder priorities related to long-term value creation. Incentives may drive enhanced availability.

Blaming the MBA university program is like blaming the toolbox if a carpenter uses a faulty hammer.

Resolution: As such, I suggest that professional business managers should find a way to update their reporting and compensation incentives enabling equal salience across all stakeholders. Also, as a line of inquiry, Dr. Acemoglu and his team may want to investigate this as a root cause.

[vii] Skills and abilities have specific meanings. Generally, we think of skills more like tools we can put in our tool bag. They are generally based on rote learning from school or practice at work. It may include analytical skills, software knowledge, writing proficiency, knowledge about history, science, etc. Skills are generally inward-focused. Abilities are generally more linked to our personality. They will include leadership abilities, collaboration abilities, team-building abilities, etc. Abilities are generally outward-focused.

Skills can generally be taught quickly, abilities take longer to develop, and may even not be possible to develop without a willingness to change personality. Ray Dalio does a commendable job describing this dynamic in his book Principles.

[viii] The Economist, May 15, 2021, “The Bottleneck Economy.”

[ix] The turnover rate is calculated from the Bureau of Labor Statistics (BLS) data: monthly nonfarm employee balance / (monthly new hires *12). This represents a job turnover rate of 30% over the last decade. The pandemic appears to be a continuation of an existing trend.


Further Reading:


High School Students

College Students

Career and Beyond


The Stoic's Arbitrage: Your Personal Finance Journey Guide

Core Concepts

Making the money!

Spending the money!

10. Budgeting - Budgeting like a stoic

14. College choice - College Success!

Investing the money!

Pulling it together!


bottom of page