fishfryer

There is no luxury like the luxury of being debt free. With that said, I don't think a mortgage is a bad idea as a way toward building wealth.

I have two engineering degrees (chem e and enviro) and an MBA (finance) so I understand where you are at. I worked for McDonnell Douglas and United Technologies for years. I worked on Rockets, subs, missiles, and wrote part of the Clean air Act in the 90s. Just remember, you won't get rich as an engineer, it isn't impossible, just very improbable. If you want wealth, you have to be in finance.

This will annoy some of you, but we engineers are better than everyone else at almost everything when it comes to problem solving and complex modeling. If I were you I would get an MBA and then a PhD in economics and get with a big brokerage firm in a big city if you want HUGE money.

Trust me, as you get older you will meet Doctors and Lawyers that make much more money than you that aren't nearly as sharp as you are and it will annoy the crap out of you. Every half wit in the world is a lawyer (my sister included) and all they know how to do is procedures, very few lawyers can think at all, same with doctors. The worst is when you have buddies from college with a basic Finance degree and they go on to work for a big Firm and they make $1.5 million a year and they aren't nearly as smart as you. It is fun to go to their house in the Hamptons, but it irks you because you know that they were just in the right business, and you weren't.

While I think engineering school is good, I think working as an engineer is bad. Engineering classes enable you to think better than most and graduating proves you are smarter than everybody else in a room, but in order to get wealth, you can't work as one for long. You will get 'Golden Handcuffs' good enough pay to keep you happy and your house full of toys, but you'll never have real money.

Get someone to pay for an MBA then a PhD, then quit. Engineering is a job, not a career, never let them promote you to where you don't have the time to go to school and better yourself.

magician

Engineers are not better than mathematicians at problem solving and complex modeling.

fishfryer

Agreed from the science end of it, but from the real world application and risk management I think engineers are as good or better. Math and physics people are exceptionally strong at theory without a doubt, but I think that engineers are better at merging different theories and understanding technology together to solve problems and (to a lesser degree) form models. Engineers do have a decent amount of math under their belts, probably close to or more than a PhD level economist is my guess. Also a mechanical engineer has more of an advantage if he were to become an analyst for a car company or a company like Bechtal or Foster Wheeler. A Chem E gets what dupont is doing or a Electrical engineer gets GE or Intel. Math guys kinda miss out on that.

An engineer has cost and finance classes in their curriculum and part of being an engineer is working within a budget. The science guys sometimes miss that aspect of the game and that is where I think the advantage for an engineer comes from.

But I do agree with you that the math guys out there could make some really large money doing modeling and game theory in the finance world. Don't get me wrong, I have a lot of respect for all those guys in technical fields but a lot of them I think are best utilized in the lab.

QUIKAG

If you come out of college w/o debt and you are making $55-70/k yr and your wife will be debt-free and making money also, you can easily live without debt besides maybe a mortgage.

It's a good feeling to not owe a penny except for a low-interest rate fixed mortgage. You have the basics down, watch Dave Ramsey for some good practical application tips.

magician

There are pure mathematicians and applied mathematicians. I've not met an engineer who was demonstrably better at real world applications than a good pure mathematician, much less than a good applied mathematician. And I've worked with hundreds of first-class engineers of all species.

I know: I've taught mathematics - calculus, linear algebra, differential equations, combinatorics - to engineering students.

Probably so.

I couldn't disagree more.

I have bachelor's degrees in Business (Accounting) and Mathematics, and a master's degree in Math. My work experience includes designing and writing software to write code to run numerically-controlled machinery (mills, lathes, punch presses, and so on), designing and writing software for navigation using GPS satellites and deep ocean transponders, designing EFP warheads (including design of all of the mechanical parts, analysis of inspection data, analysis of test data, lethality assessment, aerostability of the projectiles, and so on), analyzing mortgage-backed securities, analyzing project risk (including development of models for integrating cost risk and schedule risk), developing investment portfolio analysis software, and teaching all of the above. I haven't missed out on much.

fishfryer

by definition engineering is:

application of science to designing things: the application of science in the design, planning, construction, and maintenance of buildings, machines, and other manufactured things


It does sound like you do alot of engineering work. Whether you studied engineering or not, you are applying science to make stuff, that is engineering.

So if you are a trained engineer it only follows if you study the science of money and finance, you should be able to engineer solutions for make some real $$$$.

The point I was trying to make is that those who can 'Engineer', like you and him, have all the tools to make it big in finance. I did not mean to badmouth math folks, I was trying to give some advice to a guy that obviously is on the right track and may get annoyed seeing people that aren't as smart as he is driving Ferraris and owning yachts. I invest full time now and have been for 15 years and the money that can be made in the markets are staggering. I feel like I wasted too much time designing and engineering for other people for what seems like peanuts now when I should have been making big money.

Trust me I have nothing but respect for you Math guys, I probably learned half (or a third) of what you know and it does require a freakishly smart person to understand and apply masters level math. But doesn't it bother you when you hear hedge fund managers making $100 million per year when you know you are smarter than them?

But this does beg the following questions:

Do you think an engineer (or mathematician) working in their field has a decent shot at real wealth or are destined to a life of just having toys and paying bills?

Do you agree that an engineer ( or mathematician) with advanced training in business and economics will have the right tools to get in with a big firm and be an analyst or run a fund and make millions of dollars a year?

Doesn't it seem like a waste of a brain to make your bosses rich and the shareholders rich when it is your brain and you should make yourself rich?

Doesn't it bother you that you design something and get paid for it once but the company gets paid for it forever? And if you can't keep thinking of stuff you are out even though they are still profiting off of your brain?

Harpoon

[QUOTE=fishfryer,Apr 3 2010, 05:12 AM]






by definition engineering is:

application of science to designing things: the application of science in the design, planning, construction, and maintenance of buildings, machines, and other manufactured things


It does sound like you do alot of engineering work. Whether you studied engineering or not, you are applying science to make stuff, that is engineering.

So if you are a trained engineer it only follows if you study the science of money and finance, you should be able to engineer solutions for make some real $$$$.

The point I was trying to make is that those who can 'Engineer', like you and him, have all the tools to make it big in finance.

espelirS2K

Fish, where'd you get your masters in finance from? How was placement?

I'm doing my undergrad in finance, and most likely a masters in finance (definitely NOT financial engineering)

CKit

Hey, you guys.

fishfryer

Back to the topic.

You can easily live debt free but don't think that is the way to be.

It is OK to go into debt for appreciating assets that give you a tax break like a home. But do a few things.

Don't piss $$$ away on cars when you are young. Cars are a waste, putting mods on a car is the biggest waste of money.

Depending on the 401K you and your wife are in, hopefully there will be matching contributions, donate all you can.

invest:

Story 1:

When I got my first real job, I invested $210/month (after tax $$) in a mutual fund. I did it for 15 years, that $37,800 grew into $130K at the end of that time. A rising stock market and dollar cost averaging were the key there.

In 2001 there I sold my first house, took that $$$ and paid $245k for a massive riverfront townhome that was worth duing the last boom (2006) over $1 million. Now it is worth about $850K, but still more than a triple. I skipped a mortgage at the time due to the recession in 2001 and didn't feel that I could make money in the market. When interest rates fell, I got a $200K mortgage, invested balls to the wall and made real money.


Story 2:

I inherited $30K in college, 1982, I bought Mexican Telephone stock, TFONY.PK. This turned into TMX, whick split into TMX, AMX, and TII. It is worth $700K now and pays me about $15K in dividends per year.

Investing should be automatic. Do the 401K AND other stuff. Look up dollar cost averaging and systematic investment plans.

Buy stocks when it looks like the world is ending.

Pay youself first.

Talk investment risks when you are young.

Live below your means.

Be smart with leverage.

Debt free shouldn't be you goal, getting rich should be. Learn the science of money, there is so much out there that sometimes it seems like stealing.

BTW, Got my MBA locally from UCF in Orlando. I was accepted to UF (G'Ville, Gators) for a PhD in Economics, but family reasons I couldn't swing it. Now I just study economics on my own, It give me a good worldwide feel for international investing.