"Don't worry about pay at the start." - Do you agree?
In college, I always heard this statement from professors and especially working professionals (acquisition and development folks) who would take the time to speak with me on the phone or over a cup of coffee. I did follow this approach and am now a first year analyst that regrets not maxing my pay out instead. I went the development route and am paid a good bit less than my friends who are in acquisitions and even those in lending. From knowing what my company pays at the associate level as well, I still will be far behind in terms of pay.
My question is as follows: When should it become about the money? At what point, should I start prioritizing that? I completely turned a blind eye to pay and went instead for a role that provided the best value in other facets (vertical of real estate I wanted to be in, name brand of company, strategy that aligns with what I enjoy most, etc).
The problem is even if I stay with this company and take the promotion route I still won't be paid on par with that of my peers. Should have I taken a more balanced approach and focused on both pay and experience instead? Based on what other friends are making, I know I should at least be making what they are. Is there a certain experience level where you say, "Okay, it's time for me to maximize comp now." The issue I see with this is, why wouldn't you always try to maximize comp and experience (as it seems my friends in acquisitions are doing).
Not to be blunt, but why do you give a shit? You’re asking this as if someone can give you the answer, but you’re the only one who can answer this question. Even more, if you’re asking this question, it sounds like you’re seeking validation for a belief you already hold.
Are you happy with the role? Do you enjoy your time? Is the position living up to your expectations- are you learning? Do you NEED more money for something? Are you happy?
You’re in real estate, which hopefully means you know it’s a long term game. The real reason to get into real estate (and development in particular) is to learn the business and how to do it yourself. Frankly whether you’re making 100k or 120k right now will not make a flying difference. If you’re learning, or getting good reps, connections, enjoy the work (as you said you do) appreciate that.
Also, you’re not stuck in this role. There’s no contract you signed that said you have to stay here forever and can’t switch companies to one that will pay you more when the time arises and you need that extra pay, or you feel you’re being undervalued.
Genuinely my advice to you would be to learn how to answer the question “what makes me happy”- maybe you don’t know, and that’s okay. Frankly, life is about learning, experiencing, and appreciating each day. I guarantee you’re in a better position than most people you walk by on the street.
You’ll spend a lot of time at work- and fuck, I can tell you, you’re much better off enjoying the lots of time you’ll spend at work, than hating your life at work, and sitting on 20k more.
This has all sound negatively charged, but I understand your position, I understand why you ask this question. I’ve been there, and made the mistake of purely looking at cash. Life is too short, enjoy it. Make the most of your time, and if that path leads you to a job with better pay- hell yes.
Listen to your gut, and trust yourself.
Pay matters from Day 1, unless they're providing you with all-inclusive accommodation, food and transportation.
I hate people and organizations that try to pretend we do not work for money.
My two cents...
1 - It sounds like you've misunderstood what is meant by "don't focus on pay at the start". It doesn't mean ignore it entirely, it means focus on maximising the NPV of your future income stream by taking a longer term view. If you're now stuck in a lower paying job and haven't developed the skills to move to a much higher paying one, this would indicate you didn't understand what they meant.
2 - Never take career advice from a college professor unless you want to become a college professor. Make sure the people you take advice from have credibility, which is best demonstrated by them having already achieved what you hope to achieve.
This is the absolute worst advice I've ever seen on these message boards, and that is saying something. This is the attitude of a stupid 20 year old who's butthurt that they got a bad grade on an exam and is venting their spleen by criticizing their professors.
There is absolutely no truth to the idea that people who are teaching a subject couldn't hack it in that field. Just to test that thesis, I went to Schack's faculty page. The first four staff members include a guy who spent 16 years in real estate law, a former MD at Bear Stearns, a senior guy at a real estate consulting firm, and a guy who worked for the EPA and GE in sustainability and energy efficiency. In other words, people with highly successful careers who chose to come back and teach, not hacks as @Ironuts would have you believe. I mean, I'm sure there are some idiots teaching, but there are also a ton of idiots in the development world.
More to the point, these guys see hundreds of students pass by every year, and probably keep in touch with some of them. They have a pretty good idea of what is waiting, arguably a much better sense of what a college student's priorities and fears are than a guy running a multi-billion AUM REPE shop.
I am not a butthurt 20 year old. I'm old enough that I ought to be slightly embarrassed to still be looking at or contributing to this website.
You have missed the point in a spectacular way whilst simultaneously supporting it. The point was to only listen to people who have credibility in the form of a demonstrated history of achieving the same goals that one is asking advice about. In your rush to show how wrong I am, you've cited several college professors who have a demonstrated history of performing successfully in their field in a professional capacity. You're not contradicting me, you're supporting my position.
If you're unable to accept general heuristics and instead need to have every single nuance detailed in an online post for you to accept there may be value in it, that's on you.
OP- this is my story. I was paid $110K base + $50K bonus at my previous shop. I was okay with the comp but hated the hours. I was really working to the bone. Started at 5 or 6 AM most days and it was not unusual to work till 9 or 10 PM. Worked on some weekends as well. I did not want to do it anymore especially since I had options. There are "lifestyle" gigs out there (agencies, life co's, corporate RE etc) where I can be paid well and work 35-50 hours a week especially in middle/upper management. I quit my job literally few weeks before I could get a bonus. I could have stayed and collected the bonus if I wanted to but I was at the point where the bonus did not even matter. I had an opportunity lined up. I put in my two week notice the day I got the verbal offer. I did not even wait to complete the background check and get a written offer. It was risky but it felt so good. Guess what the base pay was at my new job? 90K. That is right, I took a pay cut. Most would not but in my view it was worth it as I was single and had no mortgage or kids, I can take more risks and I felt this was a temporary pay cut and it was especially worth it as I was going to be working (sometimes barely working) 35-40 hours most weeks and I was also going to have lots of flexibility in terms of WFH. I was also working on something that was new to me (that was one reason for me to accept a pay cut as my peers in the similar role had more experience ) even though I had a strong foundation and I bet on myself that I will get up to speed quickly and within 2 years I will get to a $160K base at the minimum. I knew a position I targeted paid $160K base and in order to get there I needed two promotions. Keep in mind a $160K base would be the total comp (base plus bonus) at my previous job. That was my target as in my mind I saw that as truly leveling up. If I was going to be targeting a 3% or 5% or even 10% increase, that was not leveling up for me as I could have gotten that at my previous shop as well.
And the good news in my story is that within a year of starting my new job I got to a $160K base. It was a year ahead of my expectation. I got promoted twice and I benefited from a little bit of luck as well. As soon I started there was a company wide increase in comp due to inflation and that adjustment meant I was already starting at six figures which made it easier to get to $160K quickly. End of the day, it all worked out for me. I took a temporary pay cut because I knew that it would get me to a place where I wanted to go plus a big reason why I accepted this new job was to work 35-40 hours while still getting paid well. No complaints so far as I feel like I am having my cake and eating it too. So take a step back and look at the big picture and every decision you take should help you get towards that goal. Sometimes a little detour would be the way to get there. You are either moving towards your goal or going backwards early (I say early as you get older most people are perfectly content with being in the goldilocks zone in return for stability and security) in your career. If you are not going towards your goal, it's up to you to do something about it, take a pay cut, switch jobs, field, market, etc, do whatever you have to do.