Is “Fake It ‘Til You Make It” The Reason We’re So Screwed?

Faking It Until You Make It Leads To Being ScrewedI remember when Milli Vanilli got busted for lip synching. I was so sad. They made their millions, garnered tremendous fame, and just like that, were humiliated off the stage forever. They probably would have kept selling albums for years if they hadn’t got caught, and Rob Pilatus may have never died from a drug overdose. After that incident, however, everybody started watching singers and music videos with a very close eye. No music fan ever wanted to get duped like that again.

But there are fakers hidden everywhere in the public eye, not just in the music business. It’s peculiar that so many fakers feel no guilt pulling the wool over people’s eyes when livelihoods and finances are at stake. I’m constantly surprised with how much nonsense there is online. I’m not talking about mind-numbing Buzzfeed articles. I’m talking about articles that pop up in search results when you’re looking for useful information on the web. What appears like helpful content written by niche experts is often plagiarized or written in a hurry by a random person with no relevant experience.

WHAT ARE YOU REALLY READING?

The online publishing ecosystem is fascinating. I’ve thought long and hard about making Financial Samurai into a magazine-type site with 10 different staff writers pumping out news and factoids. In order to grow readership, I’d direct my writers to write in as plain vanilla as possible so as to not offend anybody. There’s a reason why vanilla is the most popular flavor in the world.

In my quest to become a Vanilla Online Media Tycoon (VOMIT), I’d sit back and shake my head at all those starving writers pouring heart and soul into their craft. My fellow VOMITs and I would clink our glasses of Macallan ’46 together as we laugh at the poor schmucks who toil for hours over original pieces based on hard-won experience, yet receive no traffic…and therefore, no money.

Of course I’m joking about this evil plan. I would feel too guilty, churning out content about things I know nothing about in a greedy quest to make millions from the internet. That being said, it’s always good to see the other side of the story, so recently I had a nice conversation with a real VOMIT who is just killing it online. He said I could share his thoughts if I kept him anonymous. So read on what follows, if you’re prepared to handle the truth.

How Much Does It Cost To Buy Your Kid’s Way Into The Best Private Universities?

number-2-pencil-300x225As a pro public school guy, my ears always perk up every time friends talk about choosing private high schools and colleges for their kids in San Francisco. Like many large cities in America, San Francisco faces the same dichotomy of a deteriorating public school system that is a result of years of underfunding and a rising private school system that is difficult to gain admission to due to an undersupply of positions.

The only solution is to raise taxes to raise salaries to attract even better public school teachers. We just aren’t paying our educators enough, and that’s a travesty. The biggest irony in large cities like Manhattan and San Francisco is that those who pay the most taxes are homeowners, yet many homeowners send their children to private schools. If we can better focus on raising taxes on people who use the services, we’d have a much stronger system. But logic never wins when it comes to politics, power, and greed.

I’ve always heard about wealthy parents buying their kid’s way into the best schools, but I never got exact dollar amounts until recently. Clearly every parent wants what’s best for their kids, hence tuition’s inelasticity no matter how much people complain. Education is the key to reducing the wealth gap.

The following conversations were had at a bar after an afternoon of tennis at a private club. Please keep them between you and me. I am dirt poor compared to these guys, but at least I can kick their asses on the court. They are the top 0.1% income earners, which is a world of difference from even the top 1%. Hopefully you’ll keep an open mind when reading this post and come up with some solutions!

How To Value A College Education To Help An Abysmal Net Worth

Educational Attainment By Wealth Status ChartThere will inevitably be someone in a net worth related article comment how he or she isn’t doing so great due to all of his or her student loans. Because so much of wealth creation is about having the right positive mindset, I fear folks burdened by heavy student loans may be dragged down by a defeatist mentality.

I’d like to change this mindset by placing a specific value on our higher education. The older I get, the more I realize education is the most valuable asset of all. Education is what will break the poverty cycle. Education will provide the means for people to become better communicators, better employees, better entrepreneurs, and better citizens. Yet curiously, we pay our high school educators some of the lowest wages and charge exorbitant private college tuition. Sounds like a good business to own!

Nobody spends money on things that aren’t worth its value unless they are being extorted. The item might lose value over time, but at the time of purchase the value is worth exactly its price. So when someone comes to me and says they have a negative net worth of $30,000 due to $35,000 in student debt, I’m going to counteract their belief by asking what they spent on their college tuition to come up with its value.

Should I Go To Public Or Private University? Depends On Your Fear And Guilt Tolerance

The College of William & Mary Wren Building

Wren Building at The College of William & Mary (Public)

“What if I graduate from private school and have to live at home with my parents because I can’t find a job?”

“What if I graduate from private school and end up back at McDonald’s?”

“What if I graduate from private school and end up getting the same job with the same pay as my public school friends?”

“What if I bleed my parents dry to the point they have to work many more years to afford retirement?”

“What if I drop out of private school halfway through, thereby wasting all that time and money?”

I asked myself these questions over and over again when deciding between public university or private university. My parents weren’t rich nor was I smart enough to get large amounts of scholarship money from private schools, so I felt extra pressure to make the right choice.

My thesis is that the more fearful you are of failure and the more guilt you feel about spending money, the more you should consider going to public school. If you are unaware that 870 million people in the world suffer from malnourishment every day, then what do you really care about wasting food on your plate or gorging yourself to oblivion? If you know your wealthy parents will hook you up with a job at their company after graduation, does it really matter you spend $44,000 in tuition going to Boston University when U. Mass-Amherst costs $13,400 in tuition and provides just as good an education? Of course not.

In the end I decided there was no way in hell I was going to attend a private school that cost $25,000 a year in tuition back in the 1990′s if it wasn’t in the top 10. All subjects are taught off the same text books anyway. Some of the intro courses are even taught by teacher assistants. Why pay a premium?

I was even considering going to community college for two years and then transferring over to a four year institution to save my parents more money. But thankfully William & Mary accepted me despite my average SAT score. Virginia has some other great public schools including UVA, Virginia Tech, James Madison, and Mary Washington so it didn’t seem right to not take advantage of the public school system.

When I wrote “Average Inheritance By Country,” I was merely guessing at the $3,000 a year tuition my college charged back in 1995. After doing some digging online, it turns out my guesstimate was pretty spot on at $2,890 a year. The reason why I remember the cost 18 years later is because I was extremely sensitive to my family’s finances.

There’s No Need To Worry About Other People’s Finances

Although I’ve got a lot of opinionated posts, it doesn’t really matter if you disagree with my stance so long as what you do with your money doesn’t adversely affect others. If your way works for you that’s all that matters. If it stops working for you then you might just find yourself on a site like mine searching for answers.

I’ve learned long ago that you can’t force anybody to do anything. They’ve got to experience some sort of hardship on their own before they are willing to change. Maybe it takes a heart attack to stop eating so poorly. Or maybe it takes a massive market correction to not be 100% allocated in stocks. Whatever the financial situation may be, only experience can really have an affect on someone’s outlook.

The people who are the most argumentative are also the ones who are the most unsure about their finances. They are unwilling to expand their myopic views about how they see the world. For some reason they are also almost always in their 20s and think they know it all. If you’re so inflexible in your 20s there’s a high likelihood you’ll hit a tremendous roadblock later on. When I was in my 20s all I wanted to do was learn different strategies from those who’ve been there. What changed with Gen Y?

I sincerely hope readers find different ways of looking at things on Financial Samurai. To be unable to see varying points of view is an absolute mental failure.

PEOPLE WILL FIND A WAY TO HELP THEMSELVES