As a high school teacher I get a real kick out of asking kids what they might want to do for a living in a couple years and then helping them build some skills with that goal in mind (approaching education this way seems to have a much higher success rate than telling students they have to learn information because someone else thought it was important for them to learn it). Inevitably many of them are not sure, and while this is a good thing, I’ve noticed that the default option for many young women is to say “cosmetology.” Now there is nothing wrong with pursuing a career in cosmetology, I just think there is a smart way to go about building a career in that field, and then there is the path that most young women take. In my area, physical labour is the default option for men that don’t know what to do, and fortunately because of the farming and energy sectors, there are still very high wages available for anyone willing to put in a hard day’s work. I do sympathize with some of these young ladies who are probably just saying that they want to cut hair for a living because that seems to be more socially acceptable than simply stating, “I’m not sure what I want to do yet, but I’m keeping my options open.” Unfortunately, when you say this enough times, it seems many people convince themselves that this is their future, and consequently all motivation to reach their academic potential goes out the window.

Reality vs Perception

When you’re in high school the job of beautifying people all day long must look pretty good. I mean makeup and hairstyles are a huge part of your life, and becoming an expert in applying those techniques is probably very alluring. After all, we now tell kids to pursue their own interests no matter what the cost, because you have to love what you do every day (ignoring the fact that many of us don’t have a lot of interests other than hormones and establishing our own identity in high school). While pursuing interests is a great thing, we should probably realize that kids need time to mature and realize what they really have a passion for, before committing to that career path.

What these ladies don’t realize is the incredibly low rate of pay they will likely receive and how hard they will have to work for it. After putting my renowned Google research skills to use, I found that the average wage for a cosmetologist in the USA was about $12.00 and most cosmetologists in both Canada and the USA earn less than $30,000 per year. In order to get this wage, these people must work a job where they are on their feet all day, hunched over (apparently back and neck problems are common in the field), talking to many people you don’t really like, and digging around in hair that may not be very clean. I personally think that if this reality was made more apparent, few girls would be so quick to jump into the field.

Run Your Own Show Instead!

Now that is not to say that no one is making money in the field of cosmetology. If you are into the whole hairstyling thing (I’m not going to lie, I’m a pretty low maintenance guy) you no doubt know that the price for someone to work on your look for an hour is a whole lot more than $12.00 plus the cost of product. There is money to be made – just not by being an employee. Instead, my advice to people that want to get into the cosmetology field is to run your own hair salon, or cosmetology business. Take advantage of outsourcing the work, and instead focus your education on running your own business. Whether that means going the college route or the university route, it doesn’t really matter, the reality of that business model makes a lot more sense than working full time to make $30K a year.

The Road Less Travelled

By going to university and taking a Bachelors of Business Administration, or a similar college course, you will cover the basics of how to run a business including basic economic theory, marketing, HR, taxes, payroll, and making a business plan. Not only this, but in your classes you could focus on making a bevy of very important connections that will be a great help to you as you go forward. The friends and contacts you make while going through a business-related education will give you a great pool of human capital and resources to draw upon when you need help or recommendations for the various aspects of business life.

There are many indirect benefits to pursuing this goal relative to the far more common one of going to a cosmetology training school. Instead of devaluing the education all around you in high school with an attitude of, “I won’t need to know this in life,” I believe that students would be more willing to strive to learn new things, especially in math and business courses. If your business eventually fails for one reason or another, you are now left with some very marketable skills, and a ton of valuable experience. This is a much more enviable position to be in than fighting for a spot in a salon with dozens of others who are just as qualified as you are. The smart move is not to default into doing something you’re not sure about, it’s to put yourself in a position to take advantage of the fact that there so many people out there who are willing to let the default position become the path they choose.

The Wealthy Cosmetologist?

The Wealthy Barber didn’t get wealthy because he was a better barber, he got wealthy because he was a better businessman. I’m fairly certain that as a future entrepreneur looking to get into the cosmetology industry, you could pick up the vast majority of what you need to know on the fly by talking to experienced people in the field. An alternative arrangement might be to cut in a very experienced cosmetologist who has a long client list as part of your ownership team. In exchange for her expertise you would get to learn from the best, and promote the fact your product is top-notch. If all else failed, there are plenty of 6-month courses out there being advertised if you felt you really needed training in the art of cosmetology. Trust me, your business skills will be in much higher demand than their hairdressing background. The supply of trained cosmetologists far exceeds the demand. Don’t end up on the wrong side of that equation, take advantage of it instead!

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Don’t you love the guys/gals that get their investment advice from the water cooler? You know the guys and gals that are constantly hopping on the bandwagon of whatever terrible investment advice that their co-workers heard on the radio on the way in this morning?

“I watched Jim Cramer last night and he said that even though last week he hated this renewable energy stock, since it has went down 7% he is now in love with it, and at it’s current prices it is the best buying opportunity for this decade”

Everyone then nods their heads and positively affirms how smart everyone else is in the group. Now I often do this simply because it gets really socially awkward when you tell someone that they should probably just light their money on fire as do what they are proposing. If you tell someone that their vaunted financial expertise is exactly the sort of thing that the financial sector preys on, they tend to want to ostracize you. However, after I am done giving my false contribution to group dynamics it would never enter my mind to act on the advice, and yet countless others do.

There are actually some fairly straightforward reasons why this style of investing is more harmful than most. By trying to jump on the latest investing fad that your buddies heard about through the most recent mainstream media, you are almost guaranteed to buy at a market top, and then if you are like most investors you will panic when the investment starts to cycle downwards and likely sell at a very bad time. In other words you will do the exact opposite of buy low, sell high. The rationale behind this claim is that by the time most people around the average office water cooler (obviously if you work on Bay Street or Wall Street your water cooler is a little different… for starters it’s probably gold plated) it has made its rounds on the various media circuits. The real investors, the hardcore traders, and hedge fund managers have already been in and made their money. By the time the media reports on an investing movement, almost always the majority of the bull run has taken place and now they are just encouraging speculation. Speculation is when people purchase an asset not because they think it has good value, but because they believe the price will continue to go up and they can sell it for a profit. That in a nutshell is how bubbles happen, and why so many people can’t figure out why their investment returns most years.

Before you take someone else’s investment advice, I advise you to take a look at how the average person does picking stocks. If you’re in a hurry, I’ll save you the trouble, the vast majority of investors, no matter the geographical location or asset class will severely underperform the overall returns of their index. In other words, if they just bought ETFs or index funds they would be far better off. As a general rule, when Glenn Beck begins to pitch your asset class (hey gold lovers out there – that’s you!) it’s time to sell and run for cover.

The really interesting thing is that the guys out there that actually do make a ton of money in the stock market and experience above average returns, do so at the expense of the water cooler/investing fad types. Warren Buffet is famous for saying, “You pay a very high price in the stock market for a cheery consensus.” His philosophy revolves around investing in companies when there is proverbial blood in the streets. When everyone else panics, he simply wades in and buys companies at depressed prices because of all the volume that is suddenly on the market. There are other lesser-known investors out there who make pretty decent returns most years by simply doing the opposite of whatever most people are doing. This is called the contrarian investing style, and it would be interesting to try (if I wasn’t an ETF convert). Maybe I’ll do a test in the future by simply turning on the investment shows at night and buying whatever is the opposite of what there are saying. I’m fairly certain that strategy would outperform the average investor.

Don’t let the fancy production levels and talking heads convince you the latest investment fad is the ticket, or that this downward cycle is different than all the others and you need to sell now. Simply have faith that capitalism and entrepreneurship will continue to drive money towards businesses that can get you a decent return on it. The world is still growing by leaps and bounds, simply investing money in the market average and leaving it alone is by far the best policy for most people. Unless you heard that tip on gold bullion last week… deal of the decade they say…

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Hi all!  Here’s a guest post by Zooey Huffington, an HR consultant who works with large companies to ensure their HR goals match their bottom-line requirements. She’s been working with large businesses for over six years and she wanted to share her perspective on how to improve work performance (especially for us Gen Y’rs)

For many people, a performance review can be the most stressful part of the job. Knowing whether you are effective in your job, getting along with the right people and overall valuable to your workplace can cause anxiety. However, performance reviews don’t have to cause more stress for you if you learn how to evaluate yourself ahead of time, to ensure you know what type of questions or comments might be made during your evaluation. Let’s take a look at a few simple ways you can improve yourself and your value in your workplace.

Be a Better Communicator – Ask for Feedback

Ask for feedback on your work and effectiveness in your job periodically. This means talking to your employer or superiors perhaps once a month. It is also a good idea to ask for feedback after big projects. If you know how you are doing, where your strengths and weaknesses are, you can improve where necessary.

To the Ropes – Use Simple Evaluation Tools to Get Answers

If you are uncomfortable confronting a superior face-to-face about your performance, try using some variety of questionnaires. Send it to your superior’s office mail or, in a smaller company where it is easier to meet, simply hand it to him or her and ask that it is filled in and returned to you. On the questionnaire, ask about your areas of concern and finish with a question about how you can increase your value to the company. This allows you to keep the feedback on file to be reviewed again when it’s performance review time. Always make a copy for yourself too.

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Hello fellow personal finance readers. I go by the pen name “Teacher Man” due to the fact that I recently graduated from university and am in my second year of teaching high school. About 9 months ago my partner and I started a website called My University Money. It is aimed at helping young people (with a specific focus on post-secondary students) and just talking about financial and student lifestyle issues in general. Young & Thrifty was one of the first bloggers to really reach out to us and give us a little recognition when we were just starting off. When I read that Y & T was hitting a busy patch in life I offered to do a little staff writing for her, and she graciously (editor’s note: more like desperately?) accepted.

Generation Y has a lot to be proud of. We are renowned for our multi-tasking abilities (although I think the next generation will blow us out of the water, but that’s beside the point), and we have revolutionized the way society looks at work-life balance. These are great contributions to the working tradition in the Western World; however, a few things we are rarely accused of being are workaholics, overly ambitious, or completely dedicated to a specific project or company. I think most people would agree that Generation Y will have more fun than any generation before it, but no one will call us “The Greatest Generation – Part 2.” As our era begins to dawn, and more and more of us are called upon to shoulder responsibility in various ways, the question looms, how will we handle the mantle of leadership, and in what ways will we change it to suit our collective personality?

Old With The Old… Or Maybe Not…

I have personally seen that in a variety of industries (both public and private) aging baby boomer managers are becoming worth their weight in gold. Companies are offering large incentives to entice experienced, hard-working 50-70 year olds to stay on in any capacity (often as consultants). Why is this? The answer is actually fairly straight forward.  The majority of people with any management experience, the work ethic to do the job properly, and the attitude needed to succeed as a leader, belong to the generations that came before us. Since our forefathers (and “foremothers?”) were not as good at handling their personal finances as they were their career aspirations, we are somewhat fortunate as a society that they still have strong incentives to keep one foot in the workplace (“working retirements” are becoming more and more common), but sooner or later, the push to fill the mega-sized management footprint left by the boomers is going to take precedence. The good news is that if you are ready for this demographic shift you can personally take advantage of these trends.

Types of Leadership

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I have been meaning to write this post for a long time, so I’m so happy to finally share my thoughts with you.  As you know, the Generation Y are those born somewhere after 1982 (according to wikipedia) and the early 90′s.  We are an often talked about bunch, probably because we are the child by-product of the baby boomer generation.

Generation Y Generalizations

Other people in the workplace view Generation Y as the super speedy multi-tasking generation. We are good with technology, type at warp speeds, and are often seen multi-tasking. In fact, at my workplace, one of my baby boomer colleagues calls me “Matrix” because she thinks I type so fast.

Generation Y is often labeled as “lazy” too, because we give off the impression that we want to get paid top dollar while at the same time doing as little work as possible. We want to rise in the work place as fast as possible. We are skipping from job to job to job, often lasting at a workplace for only abut 1-2 years before we move up the ranks to another job. This is in contrast to the baby boomer generation, where they moved their way up slowly after a time span of 20+ years to get where they are at now.

Generation Y also are an entrepreneurial bunch.  I think this stems from wanting to live a life where we aren’t in the rat race for 30+ years.  Generation Y are the geniuses behind many start up internet companies, let alone start up companies in general.  We tend to live and breathe instant gratification, which is probably why we aren’t saving any money.

The Problem

Because Generation Y employees are seen as lazy and wanting to get everything for nothing, I think there can be a lot of resentment from the other generations (baby boomers, generation X to name a few) towards us.  They have worked hard for YEARS to get where they are at now, and here we are, jumping in with unbridled enthusiasm and doing their job better than them.  I think Generation Y has a lot going for us- we are ambitious, determined, great at multi-tasking.  However, we have short attention spans (thanks to being used to doing homework with the television and music on simultaneously) and get bored easily.  We need to change the way other people in the workplace view us, show them that they are pigeonholing us into a category unfairly.

So, now that we know what Generaion Y is like, this begs the question- how do we co-exist harmoniously in our workplace?

How to Co-Exist Harmoniously with your Non-Generation Y Colleagues

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