The Cincinnati Kid

Carl from Cincinnati writes--

Bill,

Congratulations on finishing your book!  I enjoy reading following
your blog, and put into into practice much of what you post!

In catching up on some reading, in your post titled "We're Back"
(http://askunclebill.typepad.com/my_weblog/2006/07/were_back.html) -
you made two points that I actually had a bit of a hard time trying to
figure out if you serious or not about.

Concerning San Francisco - "nobody can afford to live there", and
Chicago - "you can't afford that place either"... I agree, you're
right, both places are very expensive.  But both are big cities and my
impression is that they have career opportunities that might not be as
available in other markets.

Okay, so why am I bothering to ask you this?

Career advice.

Right now I work in the Cincinnati, Ohio area in IT (Senior Systems
Admin at a company with 50 employees).  I've lived here my entire life
- not out of any particular interest for the area, rather it's worked
from a career standpoint so far.  For the area, I'm doing okay... $65k
4-years out of college.  Two promotions since starting.  Plus an
additional $10k in side-work.  I'm debt free, but still renting.  For
the market, and in a primarily technical role, income tends to max out
in the low $70s.  So I've reached a point where I have to (and
continually do) re-evaluate my career.  In considering my next career
move, I've interviewed in the San Francisco area (actually, Monterey),
and talked to contacts in Chicago.  Both areas are great, and I'd
enjoy doing what I do now, in either location.  That being said, the
real cost of living in both locations seems to be more substantial
then the anticipated pay increase would compensate for.

From a career standpoint, I need to do one of three things to advance.

1) Same job in a larger market, at a company with room for continued
advancement (larger company).
2) Start a business where I'm at, serving a market that I anticipate
being successful in.
3) Go back and get an MBA (possibly part-time while I work) and use
the MBA to transition into a new role.

[Or, perhaps  just quit.  Travel for 6-months and decide what I really
want to do with the rest of my life (probably far more romantic
sounding than in actual practice)].

Do you really consider Chicago and San Francisco so cost prohibitive
as to be unaffordable for a young person?  Salary.com suggests the
cost of living increase would be manageable - but personal experience
hints at otherwise.  I want to make sure I keep progressing from both
financial, and career standpoints.

Looking back it's possible - indeed likely - that I over analyzed your
post - since your main point had nothing to do with Chicago or San
Francisco.  It really just struck me because those are two places I'm
actively interested in.

In any case, thanks for the blog.  Any input would be appreciated.

Carl

Great comments which we will take one by one.  First thanks for liking the site and the compliments.  I'm a sucker for compliments and will go the extra mile for anyone that says anything nice about what I do.  So thanks again, Carl.

First, the comments about San Francisco and Chicago were throwaway lines.  They can't be serious or no one would live there.  Believe me, there are a lot of people living in both places so they must afford it somehow. 

The truth is I'm just in a different mode than Carl and most of you.  One, I'm older and the career thing kind of took care of it's self.  Not that it wasn't a lot of work at the time but now I can chose not to live in Chicago or San Francisco.  I do live in a major metro area but WAY on the outskirts where I have a nice house, pool, stable, pool house, on three acres.  (As a side note, I built the stable, pool house and pool so it ain't like I had the help do it.)  And the whole thing is worth...less than a two bedroom, one bath house in San Jose.  Or Winnetka.  And what am I doing?  Building a new, bigger house that won't be worth as much as a three bedroom house in San Jose.

That said, Would I advise Carl to move?  In a heartbeat.  To either place.  Or maybe New York.  Or London.  Or Toronto.  Or Houston.  I'm a big believer in moving and trying new things.  Scares you to death but that's what makes life interesting.  Trying to write a book was scary and rejection, boy do I know about that, is pretty demoralizing but I just got so mad I plunged ahead.  Same with moving.  Why do it?  Because you need to learn new things and grow.  Maybe you will be back in Ohio in six months but at least you tried it.

Second reason--money tends to slide around and accomodate change.  Huh?  Say you move to Chicago and live in an apartment on the north side.  Leave the car with the folks and take the El. I bet Carl spends a lot of money on entertainment and meals in Cincinnati.  He can afford to--he makes a lot for the area.  In San Francisco, that goes out the window.  Hiking, biking and eating hot dogs with friends (ok, organic hot dogs) will take the place of going out all the time.  Money slides around to fit the budget.  There is one risk here--lifestyles may not change if the individual starts maxing out the credit card.  That is a no-no.  Carl sounds like a pretty steady character so doubt this will happen. 

Now for career.  Carl is a smart guy, he figured out the business model.  He's an IT guy.  Everybody starting out is a guy, even women.  You are a finance guy, a marketing guy, an accounting guy, or an IT guy.  You may even get mixed up--I was a finance guy and hated being called an accounting guy by an ignorant marketing guy.  But as people move up the ladder, they tend to become managers, not guys.  Carl needs to get where he can become a manager, not a guy. That is what Carl is talking about, I think.  If he is not, he should be.

Let's look at the facts.  Four years out of school, two promotions (congratulations), but with a small firm.  Plus Carl is smart enough to figure out that salaries flatten out in Cincinnati.  He is also smart enough to figure out that a job in SF or Chicago will pay more but not enough probably to offset the cost of living.

Uncle Bill's advice--look at the job content and see if it will catapult you into the future.  IT in a small firm means a steady paycheck but isn't the route to the chairman's office.  Alway's look a step ahead.  My first real job was a division job.  Since I was in corporate headquarters I quickly figured out that corporate was the power base and wormed my way in.  Stayed nine years.  Then said the hell with Chicago (Chicago is a great town but too big for me--even at three years old I knew my son was not going to have an easy time at New Trier High School. Plus I was tired of the cold.)

Stayed eleven years at the new job down here and then, with the kids in high school, took a flyer.  Why?  Because the job had a VP title.  Carl should look to Chicago and San Francisco as job opportunities that will get him on the track to manager.  If they are laterals for a bit more money, forget them.

Let's look specifically at Carl's three options.

1) Same job in a larger market, at a company with room for continued
advancement (larger company).

Not bad.  Having Intel or Apple or Sun (are they still around?) on your resume will look better than Cincinnati Widget.  Plus, by definition, big companies offer more opportunities.  Look for a company that promotes from within.  Believe me, this is getting harder but companies still exisit that do it.  At this stage in Carl's career, I would look for a few years in a multinational looking for opportunities on the inside.

2) Start a business where I'm at, serving a market that I anticipate
being successful in.

Carl is a go-getter.  That is good and I feel he will be successful at whatever he does.  But, and there is always a but, he may learn a lot from a stint at a big company.  These people aren't stupid--you have to be smart to succeed.  You can learn a lot in a big company if you pay attention.

3) Go back and get an MBA (possibly part-time while I work) and use
the MBA to transition into a new role.

Alas, a business reality.  If you really want to be a manager in a big company, you have to get an MBA.  Sorry.  But Carl already knows this or he wouldn't mention the part time thing.  Go for it, Carl.  Find a company that will pay your way, grit your teeth and slog on.

Or, perhaps  just quit.  Travel for 6-months and decide what I really
want to do with the rest of my life (probably far more romantic
sounding than in actual practice).

Hey, Carl, when you find out what you want to do with the rest of your life, let me know.  I need some help in this area as well.  Don't think Carl will go this route.  Too ambitious.

Feel like I kind of let Carl down here.  No answer like DO THIS.  Well, one thing, don't reject any place because of living costs--but do calculate the potential payback.  If the payback is not there in career advancement, don't do it. You will never know for sure going in but, again, that is what makes life interesting.  Plus, mistakes, especially career mistakes, can be reversed.  You learn from mistakes.

So, Carl, take Yogi Berra's advice.  When you come to a fork in the road, take it.  But do an analysis first.  Pros and cons, money, lifestyle, potential, family, adventure, surviving.  Then make your decision and jump off the cliff.

Enough lecturing.  Let me know what you decide.  Also would love to weigh in on the pros and cons.  But remember, this advice is worth what is cost you.

Comments

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[feveavoib]

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[Jay]

Hi Carl

A couple of things I don't like about part-time programs. A full-time program takes less than two years, a part-time program takes three or four. It's tough to keep that momentum up for that long.

Hiring managers do not appreciate part time programs. You got your MBA from where? at night? The only exception - Chicago.

If you stay at the same company, you get zilch after you're done.

Also, look at the other students. A top full time program attracts extremely driven and smart people. A great base to build a network. You get to hang out with these people build friendships, explore stupid subjects and experience really smart people (even the profs are interesting) A part-time program attracts good people but how much time do you want to spend with them when the class starts at 7pm ends at 10pm, you're tired from working all day and you've got an 8am meeting the next morning?

Yes it is a finacial burden to quit and go to school for two semesters but a full time program at a quality school takes you off of one track and puts you on another.

You've got some great schools very near you in Illinois, Indiana, and Ohio, gulp even Pennsylvania. Look at the Business Week, US News, or WSJ rankings and then look at the statistics of what theys people are making. Huge.

My experience. I went to Indiana. Quit a system programmer job making less than $30k, spent two years out of work reconnecting with my finance roots, borrowed $15k, and then got a job in a treasury department of a multi-national company that paid about $45k (I graduated in 1992, a terrible year for getting a job). I lived in a dorm on campus and loved most of it. I was 27 when I finished.

The part-time stuff is nice if you're going to school, but if you're trying to ramp your career. Full-time is the only way.

[Carl]

So why is a part-time MBA program no good? I would think that someone participating in a part-time program would be more of a go-getter, than someone going fulltime. Isn't it much easier to do a full-time program - get to focus on the job of school, and get out? Doing it part-time, to me at least, seems like something that would take more work, and require someone more committed. From a pure financial standpoint, I'd end up burning though money to get a full-time MBA for 2 years, while having zero income!

[Jay]

I'll throw my two cents in on both San Francisco and the MBA.

I moved from Ft. Worth to the Bay Area seven years ago. When in Ft. Worth I owned a house that had a rental house with it. Sold it for $103,000. My mortgage payments was about $750 (rental income of $425). My rent when I moved to Redwood City, less than a block from El Camino and the railroad tracks was $1,400 +$100 for a storage garage. How's that for sticker shock! (Prices are about the same today) Found the same house set up as I had in Texas and it was priced at $625,000. I went from a salary of about $65k to $95k. People from other places say that there real estate is expensive, well they've never been to the Bay Area. The house across the street from me just sold for $910,000 it's 1,500 sqft, 3bd 2ba, no yard, small galley kitchen.

But throw out housing and it's not much worse than any place else, you just can't get caught up keeping up with the Jones'. I don't think it's the cost of living that is bad about the Bay Area. It's the life style - I think it's oppresive (except the weather is really nice).

Bill, I'm surprised you haven't thought of the benefit of higher salaries out here. It enables you to put more into your 401K. If you're making $65k maxing your 401k is 23% of your salary (assume $15k is max this year). If you make $95K maxing is only 16%. Also an annual raise of 5% is better on the bigger number.

Now on the MBA, if you want to crank up your career in a different direction and then getting your ticket punched with an MBA is the one proven way to do it. Do it full time at a top school. (You can also do a very strong regional program if you don't want to leave the area you live in - full time though) I can't stand the part-time programs, they don't do you any good. The MBA is all about networking, changing attitude and re-directing yourself. If you don't have a business background get one. Everything we do in our work-life is business and politics.

[cahoots]

I wonder what one stands to gain from an mba....if its is all I am hoping it will be.Doing an mba has been on my todo list...i hope to get to it within 1 yr. Would you be kind enough to give me your opinion about part-time vs full time mba. Though i can't pay for the full time, I am wondering if it will be worth taking a loan out for. thanks,C