In this episode, Emily interviews Dr. Jennifer Polk, a career coach specializing in PhDs whose brand is From PhD to Life. Emily and Jen explore the damage that graduate school and academia often does to PhDs’ financial lives, in terms of both dollars and money mindset. They answer the question, “What can a graduate student or PhD do to mitigate academia’s financial damage?” from both a financial and career perspective, starting in grad school and extending several years post-PhD. Jen concludes the interview with an incredible insight that can only be gained with years of distance from the PhD.
Links Mentioned in this Episode
- PF for PhDs: Community
- PF for PhDs: Chart Your Course to Financial Success
- PF for PhDs: The Wealthy PhD
- PF for PhDs: Subscribe
- Jen Polk: From PhD to Life
- Tweet Mentioned by Jen Polk
- Self-Employed PhD
- PF for PhDs Interview with Scott Kennedy
- PF for PhDs: Podcast Hub
00:01 Jen: Woo boy, I think the two-word answer is compound interest. The more that you can put away, even very, very, very small amounts earlier on, make such a huge disproportionate difference over the long term.
00:23 Emily: Welcome to the Personal Finance for PhDs podcast, a higher education in personal finance. I’m your host, Dr. Emily Roberts. This is season seven, episode 14, and today my guest is Dr. Jennifer Polk, a career coach specializing in PhDs, whose brand is From PhD to Life. Jen and I explore the damage that graduate school and academia often do to PhDs’ financial lives, in terms of both dollars and money mindset. We answer the question, “what can a graduate student or PhD do to mitigate academia’s financial damage?” from both a financial and career perspective, starting in graduate school and extending several years post-PhD. Jen concludes the interview with an incredible insight that can only be gained with years of distance from the PhD. If this episode, and that final insight in particular, get your wheels spinning about what you should be doing right now in your finances, there are several ways you can work with me in the upcoming months to level up your financial life.
01:29 Emily: The Personal Finance for PhDs Community is always open to new members. That’s where you can find my courses on financial goal setting, budgeting, investing, et cetera, plus monthly challenges to participate in a book club and lots of opportunities to ask me questions and engage in discussion with other like-minded graduate students and PhDs. You can find out more at pfforphds.community.
I’m facilitating my brand new half-day workshop, Chart Your Course to Financial Success, twice in the next couple of months. Spend four hours with me and a small group of peers, and you’ll come away with clarity on what your current financial goal should be and how to achieve it, plus super actionable ideas for increasing your income and decreasing your expenses. On December 12, 2020, I’m facilitating the workshop exclusively for funded graduate students. And on January 10th, 2021, it’s exclusively for PhDs. You can find out more at pfforphds.com/chart.
02:34 Emily: Finally, Mark your calendars for the next round of The Wealthy PhD. My two-month group-coaching program that provides guidance and, most importantly, accountability to help you achieve a significant financial goal and set you up for future financial success. Enrollment will open in early January, 2021. You can find out more at pfforphds.com/wealthyPhD.
I’m so pleased to be able to offer you all these different avenues of support going into the new year. I hope you will identify one that fits you the best and sign up.
If you’re not quite sure about diving into working with me, please join my mailing list at pfforphds.com/subscribe. Every Friday, I’ll send you an email detailing, a personal finance concept, an actionable strategy, or an inspirational story. You will receive an incredible amount of value, absolutely for free, through the list.
Without further ado, here’s my interview with Dr. Jen Polk.
Will You Please Introduce Yourself Further?
03:28 Emily: I’m delighted to have joining me on the podcast today, Dr. Jen Polk. You probably know her brand From PhD to Life. She is a career coach specializing in PhDs. So, she has a lot to say to us around this topic. And we’re actually going to be talking about money mindset today and specifically how it affects, you know, your finances, but also your career journey as you’re moving through and beyond the PhD. So, Jen, thank you so much for joining me on the podcast day. It’s wonderful to have you.
03:56 Jen: Yeah. Thank you, Emily. It’s my pleasure. I’m nervous. I’m excited.
04:01 Emily: It’ll be fun. So, please tell the audience just a little bit more about yourself.
04:05 Jen: Sure. So Jen, as Emily says, I work with PhDs figuring out what to do next in their careers and my business is From PhD to Life. That’s fromphdtolife.com. And I’m self-employed and I live in Toronto.
What Academic Culture Teaches Us About Money
04:22 Emily: What does academic culture–in your experience, and also what you’ve observed from your clients–what does academic culture teach us or tell us about money?
04:32 Jen: Yes. Yes. Big question. So, my own personal background is from the humanities, a history PhD. And I think that academia emphasizes, at least my corner of academia, to use that phrase, thinks of money as a bad thing, as kind of a necessary evil. And extremes to which we might take that view do exist out in the wild. There are people out there who will, they can’t possibly live this way every day of their lives, but they will literally say things to me that anybody who has more money is morally inferior or that it is unethical to have, you know, more money than one needs, et cetera. And I think that, yes, one can find that view in academia.
05:29 Emily: Is that defined as more money than they have? Is that the dividing line?
05:34 Jen: Probably, probably, probably. But yeah, I think that thinking about money, talking about money makes you somehow less of a scholar, less of an intellectual. Of course, as we know, the truth is that you can’t actually do scholarly work over the long-term if you are constantly worried about money. It’s difficult. But yeah, there’s definitely a sense that if you’re the person–and I think this is also tied in with aesthetics–if you show up in your humanities department wearing flashy suits and red lipstick and earrings you will be deemed less serious as a scholar, as an intellectual. I think that is related to money mindset as well. It’s really gross. It’s really gross. And yet, of course, you need money.
06:33 Emily: Yeah. I mean, you just said that, of course over the long term, you, you have to have money or else you’re going to have a constant, you know, really it’s a fog in your brain. When you’re constantly stressed about money, when you experience scarcity, and this has been studied, you know, through research, that you literally don’t cognitively function as well as you could, if you did not have that stress in your life. So it’s really actually perplexing to me that we do this. We–academia–does this to graduate students, especially, but also postdocs and also, you know, adjuncts and other faculty members to a degree. Why are we doing this to our youngest, most vulnerable developing scholars? I mean, I know you can’t answer that question, but it’s really perplexing to me that, you know, the system chooses to put this kind of stress on people, and then moralizes it, as you were just saying, says, “Oh, this has been official to you that you don’t have the distractions of money and flashiness and opulence and so forth in your life.” When really what it is is, “No you’re stressing us out, so we can’t even think properly.” And that’s, it’s horrifying, really.
07:37 Jen: Academia is perplexing. I think that’s a good short way of putting it. There’s a lot of work to be done to kind of recognize the truth of one’s situation and think about what you actually do value that is different from what academia implies that you should value.
Money Mindsets in Academia
07:57 Emily: Yeah, I will say from my, you know, my corner of academia and engineering, I did not get the message that money is evil or money is to be shunned. Certainly, we were still under, you know, some money stress depending on how well-funded you are. But definitely from the advisor or the faculty level, we weren’t getting that kind of message. And yet, there were still money mindsets that academia tells even to students in disciplines like that, like all your best time and energy has to be spent on research. Like, you know, you’re not allowed to do XYZ other things in your personal life or earning money on the side. Even if it is not explicitly disallowed, it is certainly frowned upon, because again, you should be spending all your best energy on your research. Things like that. And I think another really sort of damaging thing that happens that probably speaks a little bit more to your experience as a career coach, is that people become anchored at the graduate student salary that they are earning during those years. And so how do they judge what they’re worth in the marketplace after they exit academia when their skills can and should be valued much differently? But how do they, you know, transform their own understanding of the value that they bring? Maybe we can talk more about that.
09:14 Jen: And I also see from scientists that, of course it varies and everyone’s experience is unique, but a lot of worry about getting a quote unquote industry job is morally inferior. And I think part of that is that those jobs pay better than academia. And I think people not only would you make more money, but potentially, I mean, depending, you would have a better life and a better career. Because there’s just lots more variety out there. And there’s a lot more better places that one could be for a lot of people. But I do think that money is part of it as a signal of virtue. Does that make sense, Emily?
09:56 Emily: Yes, I definitely hear what you’re saying. I actually would add onto that. It’s possible that you can have more of an impact on the world in industry than you could in academia, potentially, depending on your field. So, there’s that too. Is your scholarship actually getting out there?
10:11 Jen: Yeah. More money, more impact.
Financially Damaging Money Mindsets
10:14 Emily: We’ve talked about how these money mindsets are not true, damaging in some ways. How is this financially damaging?
10:25 Jen: Whoo boy, the two-word answer is compound interest. The more that you can put away, even very, very, very small amounts, earlier on makes such a huge disproportionate difference over the long-term. There is such a potentially, I mean, again, it really varies, but there is a real opportunity cost to spending time in academia, as a graduate student who is not earning, you know, a whole lot of money. And then, you know, if you do post-docs and then in a lot of disciplines, even a tenure-track professorship, is not going to pay you really enough to live in a lot of cases. And that, you know, life isn’t about comparing oneself to others, but it does put you behind, to use that framing, other people with similar types of education in terms of your financial resources. And of course, if you have debt.
11:20 Emily: I couldn’t agree more. I mean, you know, sometimes I think about there’s been, I don’t know, I think I’ve seen studies from time to time on, “Oh, a PhD is worthwhile like salary-wise because yes, you take this income hit early on, but then later you could make, you know, much more than you would with just a bachelor’s or whatever.” But I really wonder, and I have not done the math on this. I really wonder, well, you’re disagreeing with even that assertion because I’m sure it is very individual, entirely. But even taking that as a given, if you then factor in the opportunity costs for compound interest of paying off your debt, starting to invest for the long-term for retirement, it becomes very dubious.
11:58 Jen: Well, that’s just it. That’s just it. Exactly what you say. Like, even if the salary itself is higher, you’re starting so much later than other people. Like Emily, you and I are both in North America, U.S./Canada context. PhDs take a while. You know, on average, somebody is 30, more than 30, almost 30, right, when they finish, with limited prior work experience. And yeah, it’s not just about annual salary. I’ve seen those studies where everybody’s like, “Look how much more money PhDs make” than people with other degrees. And yes, that is an average. And, you know, it varies a lot. A lot. Not only between disciplines, it does vary a lot between disciplines, but within disciplines, it varies a lot, over gender and race and immigration status, et cetera, subfield. And whether you’re in an academic career track or not, right?
12:54 Jen: There’s a lot of variety there. But yeah, it’s not just about your salary number. It’s not just about that. Yeah. It’s about all of the other things you said. You know, if you’re 10 years later entering the housing market, you might not enter the housing market, et cetera. Anyways, I don’t mean to bemoan and lament, but I do think that it is a message that if anybody listening is considering a PhD or in a PhD program earlier on and doubting whether they should continue, please take this seriously and know that I respect any and all decisions to not apply, not enroll and potentially, you know, if it’s right for you, to not continue in a PhD, because it really might not be the right thing for you for lots of reasons, including financial ones.
Working on the Post-PhD Money Mindset
13:40 Emily: Yes. I would actually love to expand on that. So, we were just saying, okay, to people who have not yet applied for graduate school or are early on in your graduate school journey, take seriously any doubts you may be having and explore other career possibilities for you. For my part, I’m a little less don’t do the PhD, but I’m more on like, why don’t you get some work experience and see what’s out there for you and be able to judge the PhD more, not from, okay, I just got out of undergrad and this is what I want to do, but judge it in a little bit of a more informed context? So let’s say someone is on that path and they’re firm about finishing the PhD, but they’re still early on or, you know, midway through. What can that person be doing to be, you know, both working on their mindset, setting themselves up for financial and career success, following the PhD, what can they do at that stage?
14:31 Jen: I think that, you know, and this comes from my own work, you know, day-to-day career coaching PhDs. I think it is never too early, never too early to think about your career because there is, and I don’t, I think this surprises people, there is so much work that you can do that you really ought to do, but you know, that you can do before you ever apply for a job. And part of that is about money and how much you really need and how much, you know, you 10 years from now is going to want. But I would really, the quicker that you can get into a job and the quicker that you can get into a job and a career that is one that you like, and you can really excel in and you know, it doesn’t sort of match up that you would excel in a career and you make money, but a little bit, right, the quicker you can make that happen for yourself after you graduate, the better.
15:28 Jen: So, do all of the work that you can when you’re still a student. And I just mean the self-assessment, the reflection, like what you were talking about, Emily. Identifying the right, you mentioned identifying the careers that you are interested in going into, right? Like do all of the work ahead of time to identify those, and then start building your network, and, and draw on your network to learn more about those career paths, to get really specific about the types of work that you could do. To have a kind of a draft resume in place for various different kinds of roles that you might apply for. Again, long before you ever get to the point of application. So that six months, four months before graduation, before you’re kind of ready to work, you can hit the ground running.
16:13 Emily: You mentioned like doing self-assessments and so forth. I did a lot of that stuff and it was provided by the career center at my university. I wouldn’t say I showed up at every event, but I was definitely like a regular frequent flyer at, you know, what they had going on. And I was able to do like, yeah, some of the various self-assessments and that was wonderful.
Career Exploration: Know Thyself
16:30 Emily: So, there’s resources that may be available to graduate students through their career centers. There’s your website of course, From PhD to life. Do you know, would you recommend any other resources outside of the university context, for people to help in this like career exploration phase?
16:46 Jen: Yeah. I think at this point, anything can be useful. And so, you know, I think it can sound really simple, simplistic but even just sitting down and making a list of the things that you actually truly value and that are really important to you, that there’s real power in that. Taking a few minutes and just doing a brain dump, like, okay, what do I actually value in having, and write it down. Make a visual of it and make a graphic that you stick on your computer desktop. I mean, whatever it is so that you can keep reminding yourself when academic culture is swirling around you, which can be, I’m exaggerating, but it can be a bit of a totalizing culture and impose values and priorities on you that, you know, can kind of make things messy, just to remind yourself of what you truly value.
17:42 Jen: When I say anything can be useful at this point, I mean, sure do the Myers-Briggs. Scientifically dubious, doesn’t matter, because point is to give you new language, like literal words, and new perspectives, different perspectives on the types of skills and strengths that you have. So, any kind of like skill assessment, strengths test, value survey, anything like that, you can find online. Any of those that can be really kind of interesting to get you thinking about yourself in a different way. And then make your own lists. Some people like spreadsheets. And take advantage of any and all assessments that, yeah, you get from your career center on campus if that’s available to you. This process, I’m talking about it like it’s a mess, and that’s because it is a mess. So, it’s fine. And the other thing I would say is that this is not a process of identifying your one true right job.
Do Not Get Stuck on the “Dream Job”
18:42 Jen: Your dream job. No, no. Wipe that from your mind. That’s not a thing. A lot of jobs out there are broadly similar. And you, whatever your PhD discipline, whatever your background, you can do a lot of them. So they’re broadly similar and you can do a lot of them. And so what becomes important is not that particular job title, but more where in the world do you want to live? What kind of lifestyle do you want to have? What the vibe of the office that you want to be in? What kinds of like actual work do you want to do every day? Who do you want to hang out with? What kind of impact do you want to make? So all of those kinds of questions that, like job title is not even that relevant. At a certain point, you’re going to try and identify some so that you can find jobs to apply to. And so that your network can help you out by making suggestions. But yeah, it’s a mess. Embrace the mess and know yourself.
19:37 Emily: At that stage. Because you can be really open to a lot of different things, like you were saying. We’re not at all trying to like narrow things down, right? It’s about sort of broadening. So, I’m also thinking about, for an early-stage graduate student, mid-stage graduate student, how to mitigate this financial damage that we were talking about. And so very briefly, I just want to say, as you said earlier, compound interest. So if you are at a stage in your finances, when you’re able to save, get an emergency fund together, but after that start tackling your debt, start investing if that’s where you are. And I of course talk about that many, many other interviews and so forth. So people can find a lot more resources. But as you said earlier, the early you get started, small amounts of money, perfectly fine. It’s still going to make a difference.
The Value of Outside Work Experiences
20:18 Emily: So don’t dismiss just because you’re a graduate student, “Oh, I can only save 50 bucks a month or I can only save a hundred bucks a month.” That’s amazing. That would be a lot of money if you actually got that invested. So don’t dismiss that while you’re, you know, doing all this other career stuff. I also want to bring up outside work experience. You know, you mentioned earlier, like, you know, think about your network and so forth, and you can do that without working. You can expand your network. But you know, for some PhD students, it is possible to do internships or to have some kind of side hustle, that’s going to ultimately help you in your later job. Can you speak to that a little bit?
20:53 Jen: Yeah. And I take your point, Emily, that you said for some they can have, because yes, acknowledgement that, you know, it does depend on visa status and the contract, et cetera, et cetera. But, so in response to a Tweet I sent earlier this morning, somebody, I think she’s a humanities PhD student, said that in her program, when she was doing her PhD, she was reflecting on one of her colleagues had this like prestigious grant. So she didn’t have to have a job on campus to pay the rent. Because she had the prestigious grant. And the person who wrote the tweet was saying, you know, I didn’t have that, but instead I worked outside of academia and that, you know, the implication here being that, that gave me the same amount of money. And the vibe she got, not only the vibe, the actual literal the message she got from her professors in the department was that the fellowship was of greater value.
21:46 Jen: Even though from our perspective now, as people out in the world, you know, working jobs, we know that actually in some ways having actual work experience is more valuable. And that is really, really, really important and can’t be undervalued. This is not, you know, to ask students to do more and more and more work. But just to say that when you are making decisions about what to do in your kind of free time, quote unquote, you know, where you have a choice about whether to do this and this and this, just to pause and say, “Well, the, the thing that I think that I should do is adjunct one more course.” Well, hold up, just think to yourself, what is the value of adjuncting a course versus stepping up your side hustle or getting a job outside campus, even just in retail? I mean, it’s not obvious from where I sit that adjuncting a course is the right move. Whereas that can be like just a totally obvious thing according to academics, but no no no. I mean, it really depends. So, I would, you know, use your critical thinking skills and question the things that seem obvious to you.
23:00 Emily: Emily here, for a brief interlude. You are invited to my brand new half-day workshop, Chart Your Course to Financial Success. The central question this workshop will help you answer is what should my singular financial goal be right now and how should I best pursue it? I’ll teach you my eight-step financial framework that explains when you should save versus pay off debt versus invest. And we’ll explore many, many strategies to increase your income and or decrease your expenses. I will facilitate the workshop exclusively for funded graduate students on Saturday, December 12th, 2020, and exclusively for PhDs on Sunday, January 10th, 2021. You can learn more and sign up at pfforphds.com/chart. That’s P F F O R P H D s.com/ C H A R T. The deadline to register for the December 12th workshop is Wednesday, December 9th. So, don’t delay. There are discounts currently available for both workshops and registration is limited. Now, back to the interview.
Pay Attention to Your Base Salary
24:10 Emily: Let’s now talk about someone who’s finishing up about to finish up the PhD, and maybe about to finish up a postdoc, if that’s the choice that you made following the PhD. And you want to get a real job and it’s not going to be in academia. So, what can a person who’s reached that stage do, again, to mitigate the damage that the mindsets and the financial damage that academia has caused?
24:31 Jen: It’s really tricky this because you know, some people ask, how do I know when to take this job now, or to take the risk of turning it down in hopes that I would get a higher offer six months from now? So, you know, I think it’s not obvious what the answer is and it will highly depend on the individual person. But one thing for sure to think about is, when you’re ready to accept and negotiate a job offer, right? Accept and negotiate, right?
25:02 Jen: Both of those together. That your base salary is a really important consideration. It’s not the only thing up for negotiation. It’s not the only thing to discuss. But that a one time payout, like a bonus, like a signing bonus of five grand, for example, that seems great in the moment and sure you could invest that, but over the long-term, it’s probably better for you to have like $500 extra on your base salary, something like that. I mean, I can’t do the math immediately, but I think tending to base salary is really important.
Do Not Underestimate the Value of Your Network
25:37 Emily: To pick up where we left off with the career exploration, exploration of yourself. Now this person is ready to narrow things down and apply for some jobs. So, what do they do at that stage?
25:53 Jen: Yeah. So, I think don’t underestimate the value of your network. And before people are like, “Hold up, Jen, I don’t have a network.” No, you have a network, you have a network and you know people, and the people that know you also know other people. And, it can depend, but your academic network, don’t discount them. Even if you’re applying for non-academic jobs. Again, it can depend. But, I mean, I have a client now who is a research associate, a post-doc, and he was nervous about talking to his PI about the fact that he’s, you know, he’s on the job market. And he had the conversation and the PI was very supportive. And then the PI sent a few emails. My client got some interviews literally the next week and, you know, might have a job offer like within like a month. And so don’t discount the value that your network can come through for you.
26:54 Jen: And I know in my work with PhDs, with my own clients, but also all of the research that I’ve done over the years that you talking with people, and that’s all I mean when I say you should network, is you should interact actively with people in your field, with other professionals, quote, unquote. Just actively interact with people, that pays off enormously. And if you don’t do that, it’s going to be so, so, so, so, so much harder. At this stage, unless you have really particular technical skills, and I would wager that a huge number of PhDs don’t–and that’s not a criticism, that’s not a criticism–but if you don’t have these like really narrow, really specific, really rare technical skills, and you’re not at the right place at the right time, then you really have to use your network.
People Can Connect Us to New Opportunities
27:48 Jen: And that’s all of us. Not only so that potentially you could get referred to a job, you could be an inside hire as it were. Right? That’s great. But it’s not only that. It’s so that you can learn what’s out there. It’s so that you have people on your team to send you job ads. I applied for a job in September, and I wouldn’t have seen it except that somebody that I know and have known over the years. I’m not frequently in contact with her, but she kind of knows about me in general. She sent me the job ad as soon as she saw it posted. And I was like, “Oh my goodness.” And what happened is I had a number of other people send me the job ad subsequently.
28:26 Emily: Your branding is so clear that many people could identify what is a perfect job for you.
28:31 Jen: Exactly, exactly. Right. Exactly.
28:34 Emily: I actually have another story to add to that pile, which is how my husband got his job in industry. And so this is more about the value of networking with people from your own program who have moved on in the years prior to you. Because it’s not just the faculty who have networks. It’s anybody who’s exited academia. Even an undergraduate that you worked with who is now in the workforce can be a contact in your network. So my husband, some person who had graduated from his program a couple years earlier, sent a job listing for his, you know, at the time current company to my husband’s PI and said, I know that your lab lines up very well with what we do here. Could you show this to your students who are graduating? And that happened, and my husband got that position. So that was like just, yep. Clearly networking. Because of course it was on the strength of his PIs reputation. This individual didn’t know my husband in particular. But yeah, that’s exactly how it happened and it was quick and easy.
29:31 Jen: Yeah. And that’s what you want. Right? I mean, life doesn’t always work out that way, but quick and easy means that there was years of work that went into that ahead of time, but it doesn’t have to difficult. It’s all, I mean, it’s just about making friends, having good conversations and doing work that you find interesting and that you find engaging. And if you do that over the years and you are in conversation with people about that, hopefully kind of stars align at a certain point and it seems easy.
Always Try to Negotiate Your Starting Offer
30:03 Emily: Yes, exactly great point. So, okay. Our candidate has, you know, done the job searching, done the self-reflection, applying for jobs. You mentioned a moment ago, negotiating base salary as incredibly important. And so this to me also is one, probably your biggest opportunity, to mitigate financial damage that’s occurred during your PhD, is to get that first starting offer as high as you reasonably can within the scope of the field and your skills and so forth. But to negotiate that offer, because I think some PhDs might be kind of bowled over by, “Oh my goodness. You’re offering me how much money?” And again, they’re anchored to their graduate student salary. And so, might just feel so grateful, yeah, and I get that, that they don’t negotiate. But really it’s expected. It’s absolutely expected in industry and it’s probably going to be pretty well-received.
30:54 Emily: Even if the answer is, no, this is a union job and you can’t negotiate, that might be the answer, but you’re not going to be faulted for trying. Right? So, definitely at least attempt that negotiation, because as you said, having a slightly higher base salary, that’s going to affect for sure, whatever salaries you have, as long as you stay at that company. And may even beyond that, if you know, employers shouldn’t, but are allowed to, at least in the U.S. In many cases ask about prior salaries, it depends on what state you’re in. So it’s possible that it could even affect once you leave that, you know, that particular employer, could still follow you. So getting that starting salary as high as you can is a great idea. Even if it seems really scary and daunting to you in terms of the number.
31:38 Jen: Yeah. And I would recognize, you know, everything in life is a risk. Sure. Of course. But once an employer has made an offer to you, they are imagining you solving their problem and hanging out with them every day. And that gives you some power here. As I say, there’s a risk, but I would, you know, own the power that you have in that situation to make a strong case for yourself. You have to make the case. But you want to be successful in that position long-term to help the team grow, et cetera, et cetera. And so, you’re going to show up for them and they should show up for you in terms of base salary.
Good Employers Make their Employees Feel Valued
32:22 Emily: Yeah. And I think it actually goes back to what we talked about earlier that academia, for whatever reason, decides to put this financial stress on its trainees. Your employer probably does not want you to be under that kind of financial stress. They want to pay you enough to reflect the value, to make you feel like you’re valued. That you’re not going jump ship and go to someone else. That you’re going to be able to live in the city that they’re in, you know, comfortably without having to move an hour away for your commute. All of that stuff affects your performance at work. And so it can all come into play when you think about what is the salary that I want to have to perform well in this position? That’s really your opportunity to express that.
32:57 Jen: To a certain extent, there’s some recalibration that might need to happen for folks coming out of academia, where things can be such a struggle, and you can have this impression that any employer is kind of out to get you, out to screw you over. Depending on the experience that you have in academia and the experience of your colleagues and friends around you. But yeah, as Emily said, I mean, any employer that you would really want to work for, they recognize the crucial importance of their labor, of the people doing the work. I mean, this is so, so, so important, and employers, good employers, employers that you want to work for. And there’s lots of them out there. They’re not going to pay you outrageous sums of money potentially, but they want you to be able to have the lifestyle and do the work and be happy and get what you need to be on their team, solving their problems. So, I would assume, assume that they want to pay you equitably right. Fairly and adequately. And, you know, maybe a little more than that. I would assume that, and go forth.
34:04 Jen: Yeah, I am glad you put in the caveat of a good employer, because certainly there are ones that–maybe not employers broadly, but maybe a manager, someone who views this more as a competitive thing, like I’m going to pay you less because I have that better from my bottom line. But it really should be viewed more so as, “We want you to do a great job, and we’re going to compensate you well to do that great job.” And certainly if you get into a salary negotiation process with an employer and you’re getting a vibe that they don’t really seem like they want to support you, then that’s your red flag. And that’s the time to go back to the exploring you’ve done and go back and look at other, you know, positions that you might have, and so forth.
Avoiding Lifestyle Inflation and Unhealthy Mindsets
34:40 Emily: Okay. So, let’s then talk about, you’ve got the job, maybe you’re a few months, a few years into that point. What should you still be doing to again be mitigating the mindset and the literal financial damage that your time in academia has wrought?
34:55 Jen: Yeah, it’s interesting. I mean, I think there’s lots of things that one could say here, but something that comes to mind for me is a phrase that I’m sure, you know, people that grew up in this part of the world have heard, penny-wise and pound-foolish, right? And to a certain extent, you know, when you’re in academia, there are a lot of things that you don’t pay outright for, of course you do pay for them through tuition, et cetera. But it doesn’t occur to you. So there might be things that you yourself would want to invest in, to use that term. And I use that term kind of in a broader sense that will help you over the long term. Ideally, your employer pays for professional development and pays for coaching and whatever, pays therapy, right? Ideally you have benefits around that. But it could be, you know, if you don’t, or if you’re unemployed at the moment, that it can be really valuable to invest in those kinds of services for a relatively short amount of time, because the investment as a metaphor is the right one, because there will be a longer-term payoff.
36:01 Jen: And if you can get your career started kind of on a good footing, great. Right? It’s just so helpful. It’s so helpful. And I would sit down with a money advisor, financial advisor, or whatever the term is, you know, somebody who can kind of tell you things, even if it’s your mom, right? Because if you can get into the lifestyle kind of early on of making good decisions around money, but also, you know, making decisions about you suddenly have more money, hopefully maybe you can set money aside for vacation. You know, that’s a good thing too, et cetera.
36:43 Emily: I totally agree. And actually, this is a phase that I’ve come to now that I’m, you know, a few years post-PhD and into my career, my business with Personal Finance for PhDs, is this idea of investing in myself was something I was very reluctant to do, right? Because I was being penny wise, pound foolish right when I finished my PhD because I wasn’t making that much money yet. So how can I, you know, decide to invest? But actually, you were one of the first people who I worked with, you know, near the start of my business. And it was a was a small investment, but I joined one of your programs. And it, I mean, I still talk about it and laud it, this was Self-Employed PhD, and how we originally met and what an impact that made on me.
37:23 Emily: And I’ve since then been much more willing to invest in training and professional development for myself. So I would definitely, I mean, obviously my field as an entrepreneur is, is different from what other people were doing, but just be thinking about what are the professionals, if it’s again, not provided, as you said, through your workplace, which sometimes it is, what professionals might I work with that can help further my career further, my financial development? Of course you are one of those professionals. If the question is more on the career front with PhD to Life. I am one of those professionals if the question is more on the, how do I handle my finances? How do I handle my budget? You know, what should I be saving for? What should my life look like? If those are the kinds of questions, then of course, feel free to work with me, but there are also many other types of professionals, depending on the exact needs that you have.
Invest in Your Future
38:06 Emily: And as you said, it is an investment. It takes money to work with a professional in the way that we’re talking about. But ideally, the dividends are going to start coming very, very soon after you begin that relationship. Another sort of financial tip, I’ll definitely say, once you’re into that, you know, your career and you’re making a much better salary than you were as a post-doc or as a graduate student. This is now the time to not super increase your lifestyle. Yes. Hopefully, you will be spending more so that you don’t feel stressed. But to some extent you should keep your lifestyle level on a little bit lower than maybe where you see your new colleagues at because you do need to make up for lost time a little bit, and doing things like starting to invest inside your company’s 401(k), even maxing out that 401(k). So to be going into those tax advantaged, designed for retirement types of accounts to a great degree, I mean, just put money away from your salary. You never see it coming in your paycheck. It’s all payroll deductions. That’s the best way to do things. So it might seem like a large number. Right now, a 401(k) in the U.S. would be $19,500 per year to max that out as an employee.
39:17 Emily: Why not? Why not? If your salary has jumped up by much more than that in this transition, why not go for that? Why not have that be your new anchor in your mind? So think about maxing out that 401(k), or at least contributing a good amount to it. Think about making serious, serious progress on your student loans if you have decided that you’re not going to go for an income-driven repayment plan and forgiveness plan. So all kinds of other questions, but this is the time when you get into that job where you can really, like you were saying earlier, you know, hitting the ground running like you’ve done these years of preparation for your career so that by the time it’s finally time to apply for a job, you’re ready and raring to go. It’s kind of the same thing financially. You’ve been keeping your lifestyle low for such a long time. Now you have the salary, don’t do too much lifestyle inflation and just get saving, get investing, get on that debt.
Think of Your Future Self
40:02 Emily: When we were preparing for this interview, you told me you had a message for people earlier on in their PhD journeys than you are currently. So what is that message?
40:12 Jen: Oh boy, your future self is going to care so much more about money than you do now. You know, if you’re in a PhD program, like I started my PhD at 24, like I was like, “Whoa, $15,000 a year.” This was a while ago now. Great. I can’t believe, you know, we hear this all the time. I can’t believe I’m going to get paid to do a PhD. That’s amazing. Okay. Awesome. Congratulations. But just know that your future self is going to care so much more. I mean, I happily, relatively happily, lived with a roommate for years and years and years, and I now live by myself and I pay a lot more money for that privilege, but I just, I just don’t, I don’t want to go back. Right? And so, of course I need a lot more money than I used to. And that, yeah, your future self is going to thank you i you care about it a little bit more than you might be inclined to when you’re, say, 24.
41:15 Emily: Yeah. And by doing the things that we’ve been talking about, like negotiating, like starting to invest early, even if none of your peers are doing it. Like having a side hustle maybe to bring in a little bit of extra money. I’ll say from my perspective too, like now that I, you know, my husband and I got married during graduate school, so we really, you know, we didn’t need any more money after our marriage than we did before. We were both in graduate school. But after we finished our PhDs, we had a couple babies and you know what, once you get on that train, things get very expensive very quickly. And so that’s not at all to say that you can’t have children earlier. That’s just my personal journey, but I certainly feel like we need to command a much higher salary at this stage in our lives and our family formation than we did years ago when we were, you know, DINKS [dual income, no kids]. So there’s that too, if you want that in your future. Yeah. It’s something to start thinking about now.
42:08 Jen: One of my recent clients, she lives in an expensive part of the U.S. Right? Granted but the lifestyle that she has now, a few years out of her PhD with a couple of kids and, you know, a mortgage and all of the above, she really can’t accept a job that pays her less than $150,000 a year. And right. It’s just the reality. And that might seem outrageous to folks listening now who are living on, $30k or less, maybe much less. Like, just keep that in mind. It’s not, you know, I’m not saying that my client, she’s not greedy. It’s just the reality of the situation. Life can get expensive really quickly.
42:45 Emily: Yeah. And I’ll link actually in the show notes, a wonderful interview I did with Dr. Scott Kennedy a year or two ago where he talks about his own realizations as he formed his family during graduate school, that he was going to have to change his career plans, to go into a different field that was going to pay more because he could not afford, now that he had a family, to stay on the track that he had been on. Even though that was sort of intellectually, maybe his preference from earlier on. So these kinds of things have, you know, your life has real impacts on how much money you need to make. And that’s something to start, you know, being realistic about as early on as possible.
How Can People Work With You, Jen?
43:24 Emily: All right, Jen, how can people work with you, should they, you know, if they’ve been intrigued by this interview?
43:32 Jen: For sure. Yeah. Thanks for asking. So, start on my website fromphdtolife.com. I work with individuals. I do small group things, coaching, open discussions. Those are a lot of fun. Shout out to small group things. I think those are awesome. I do drop-ins for Self-Employed PhDs. So, if that applies to you at all, check those out. And then I also work with institutions. So I’m happy to come to your campus, virtually please, I do a presentation or a workshop. I love workshops. So there’s different options.
Best Financial Advice for Another Early-Career PhD
44:07 Emily: Wonderful. And final question that I ask of all my guests. What is your best financial advice for another early-career PhD?
44:15 Jen: So this is a totally “do as I did, and also, as I say,” usually those two things do not go together. But one thing that I have been doing for 20 years, gosh, wow, something like that, is I track every penny. There are no pennies in Canada anymore. I track everything that I spend. So I know how much my life costs. Like I literally know how much my life costs in different categories. And years ago, I used to do this on a, it wasn’t even Excel. I use the WordPerfect version of excel, just a spreadsheet. But now there are lots of programs out there. But I think, you know, tracking what you spend is really, really important. It’s different from budgeting. You can do both together. But the example I like to give is like, I think this is really common for grad students.
45:11 Jen: Like you might spend like a lot of money, like on clothing kind of once or twice a year, not on a monthly basis. So some of the kind of standard ways of thinking about budgeting is sort of like a monthly thing. You go to your big annual conference one month and suddenly you’ve spent $2,000 more than, right? So anyways, but track, and then you can see the trends over time. And by seeing the amount of money that you’re spending in different categories, literally being able to like, see it on a spreadsheet, you can make decisions, better decisions about, you know, how much, how do you really want to spend $200 on takeout every month? Maybe. Yes. Maybe no. Right. But it makes it very clear.
45:55 Emily: I totally totally agree. Foundational personal finance advice. Step number one, track your spending. Track your expenses. Well Jen, this has been such a wonderful conversation. Thank you so much for coming on the podcast and sharing your expertise.
46:07 Jen: Thank you.
46:09 Emily: Listeners, thank you for joining me for this episode. Pfforphds.com/podcast is the hub for the Personal Finance for PhDs podcast. There, you can find links to all the episode show notes and a form to volunteer to be interviewed. I’d love for you to check it out and get more involved. If you’ve been enjoying the podcast, please consider joining my mailing list for my behind-the-scenes commentary about each episode. Register at pfforphds.com/subscribe. See you in the next episode! And remember you don’t have to have a PhD to succeed with personal finance, but it helps. The music is Stages of Awakening by Podington bear from the free music archive and is shared under CC by NC. Podcast editing and show notes creation by Meryem Ok.