For anyone else in tech, how do you deal with job uncertainty when it comes to long term commitments?
Partner and I are 22M and 22F with ~250k HHI (220k and 30k) in HCOL. Since graduating college my partner and I have been talking about long term goals. However, I consistently hear comments about my job being replaced within the next 5-10 years. I feel like I’m just at the start of my career and any day now with layoffs and AI my job might be completely axed.
Talking about things like having kids and a house 10 years from now had me thinking about how I could possibly commit to these things with the uncertainty of this field. I don’t think AI in its current state can replace me but consistently hearing the narrative from peers does get worrisome. We already save 50% of our take home but I feel like it should be even more now in case the gravy train ends.
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Counterpoint, if you can make 600k at your age, you can pivot to something else and likely still be really successful. Same goes for OP.
For what is worth I work in tech as IC and expect ageism to hit at some point, but by that time I would either have FIREd, pivoted to something else or be an executive.
When do you think the ageism starts? I’m 37 and wondering how long I have 😅
I'm new here and new to having access to insight into truly HI occupations. Hearing that it's casually possible for someone to make $600k at our age and not be a professional athlete or minor celebrity is mind blowing, if not earth-shatteringly defeating.
I'm seriously impressed by those who resist succumbing to comparison and existential doubt.
TLDR: I probably shouldn't be allowed in this sub, but I can be aspirational.
At some point it becomes more about the platform you are working for than literally being 3x as good as a person that makes 200k - if you are 5% better than your cohort at a role, but that 5% is projected across managing 100m dollars, then your pay premium is only a fraction of your incremental value to the enterprise. Maybe that helps to contextualize a bit, though I have no idea what that particular person may or may not do in finance. This is often how pay scales in these kinds of roles. At some point it’s just worth it to the employer to pay more for an edge in performance and perhaps be a bit more worry free. This is generally more common in cash flush industries.
This is the way. If you save and invest you don’t need to work another day in your life.
If you save around 1 Mil, a simple index fund investment will net you an average of 100k per year, have to account for capital gains and general taxation, so you would be under that number.
So if you want your typical HENRY salary l but without the “working” part, youd have to save up around 5 million, and then you would receive roughly around 500k per year even on “safe” investments.
Safe investments do not return 10% per year. Conventional wisdom is to use 4% as a baseline, more agressive estimates bump that number up to 6-7%.
Over the past 150 years the S&P 500 total return averages 9.5%, with inflation it’s a bit above 7%. The 4% rule you’re thinking of accounts for inflation, down years, and assumes 80% stocks.
Keep your head down and save as much as you can. Diversity your skills and stay ahead of the curve of changes where possible.
Happy cake day!
Well, first, you’re not making any long term commitments. You’re speculating about what you might like your life to look like in the future, with no actual commitment involved. A long term commitment would be if you decided to buy a $2M house because you thought you’d be making this amount forever.
If you don’t think it’s safe to imagine having kids or a house in the future because AI might take your $250k-a-year-at-22 job, very kindly and respectfully I would suggest you seek therapy because it seems like you have a lot of anxiety about the future and nervousness about money. The vast majority of Americans don’t make anything near you; if 95% of adults in the US can’t afford to own a home or have kids, you’re going to have much bigger problems than AI taking your job.
Then let’s talk numbers. You’re saving 50% and I’m guessing you’re in a high tax area, so let’s assume you’re saving $50k a year. Are you willing to assume you’ve got at least 3-5 years until AI eliminates your job? Go plug $50k times 3-5 years into an investment return calculator and see how much you end up with at 65. You’re already set.
Finally, you don’t get a $250k job at 22 without being smart and adaptable. If AI takes this job, you’ll figure something else out and find another way to be successful.
That does put into a good perspective, even if it lasts only 3-5 years we’d be alright. Regarding anxiety you’re pretty spot on, I think this largely stems from my dad losing his job in ‘08 so I always think the same will happen to me 😭
Yeah, I graduated high school in 07 so I have the same scarcity mindset. I have a great job now and have had for 9 years, but I’m constantly thinking it’s all about to come crashing down and I’ll be penniless, because we’ve seen it happen personally
It’s normal to go through a career pivot every 7-10 years due to diminishing returns.
The one career model was tied to stable pensions, fewer education pathways, and slow technology changes.
Add pivots to the plan and it will feel much more natural.
Good point, this comment made me realize that I’m a bit silly thinking I have to stay a SWE forever. Funnily enough 5 years ago I was sad I got rejected for a CS degree at my college and had to go with a Math degree, but that might be the exact thing that helps me pivot if I ever need to.
Agree with the responses here. All we can do is build up financial resilience and continue to upskill to make sure we can find roles that are still relevant.
And my hot take is that a lot of the AI discourse is hubris. We were supposed to have replaced truck drivers with autonomous semis now too.
Yes, one day AI will be a direct threat (and not just an excuse to lay off to make shareholders happy). Probably not in 5 years. Either way, you and your partner should build the future you want, just maintain a strong financial foundation to weather any storm (illness, unemployment, etc).
Nothing wrong with having goals. What would the alternative be? Just live life aimlessly?
Yes, every industry could change drastically. Programmers may or may not have a job five years from now. But that doesn't mean you shouldn't have any shared objectives to prioritize life choices on. Like, if the goal is to own a house, maybe you do that in a place that's not the Bay Area. If the goal is to have kids, then also plan to live near family so that you may not have to pay for daycare or a nanny.
If you’re a software engineer (making a bit of a leap here), you’ll be fine, as long as you’re good at what you do. AI isn’t replacing us any time soon and it’s only causing more software to make it to market thus more demand for us.
If you’re a first generation worker in tech, I hate to break it to you but this is not an industry built for longevity in a career. This is also one of the most difficult times in the industry because of the constant layoffs, productivity gains from AI requiring fewer junior staff, and general economic headwinds coming in the U.S.
When the music ends, whenever it does, it’ll be unpleasant and worse than the dot com because traditional industries have slowed down.
Develop your skill set, learn, keep yourself mentally and physically well, and save your money prudently. Be open minded to opportunities and don’t disparage yourself when things get tougher because many people will just be in the wrong place at the wrong time and it can be you in that spot too
Not much you can do except max your retirement vehicles, back door, and e-fund. After that, adjust your e-fund to what you’re comfortable with.
I think this is where my age is finally a benefit. I’m looking to retire in the next couple of years or as long as I’m not laid off. So many people I know have been laid off. It was fun while it lasted.
Anything could happen to anyone. We need to plan but don’t let it rob you of your joy and enjoyment of your current situation- young with few responsibilities and a partner you care about. That’s awesome! Definitely save, but take trips and travel while you can! Lastly, network. Make it a priority to network and have a group of people you could call in the event you are looking for a job. Be excellent at what you do, stay relevant, help others. You’ll be in good shape.
We saved and saved. Our industry has always been up and down with lots of layoffs and jobs are concentrate in some areas we absolutely didn’t want to live in. So we saved towards financial independence as a hedge against losing our jobs