Janet Yellen recently provided a federal reserve study, with the ultimate findings being that income inequality creates different opportunities for people. Now this isn't exactly a big discovery, however it seems odd this study was performed. You can read the full article published on CCN Money here
It is my belief that everyone has certain advantages and disadvantages in life. Some people have more money, some people have better connections, some people have better family relationships, etc. etc. And there will always be someone out there with more advantages than you, which is where work ethic becomes key. However it can be very difficult to overcome if you are significantly disadvantaged.
For me personally, I think that someone coming from poverty and growing up to become middle class is a lot more impressive than a trust fund kid who makes upper middle class money. Meaning it is more about where you get to with what you have, than just a measure of dollars and career success.
Do you guys think the income inequality is playing a big role in how individuals turn out? Can you identify a solution that may be able to fix this issue Yellen points out? What is more impressive to you, creating more with what you are given, or sustaining what you are given (in this example at a very high initial level) initially?
It definitely does. That being said, growing up rich can also create problems that hold you back like family businesses and societal norms. Also, getting everything you want as a child can produce adults that are not willing to work.
Anyone who says otherwise is delusional. I'm one of the very few of my childhood friends who "made it". The rest in jail, on drugs, doing nothing with their life, etc.
I never knew what IB, AM, S&T or any that was growing up or even halfway through college. All I knew was that I wanted to be "in business" like Donald Trump on The Apprentice (very serious)
bingo. it's more lack of awareness and being pushed to greatness by your family, contemporaries, teachers, and so on. this is why bringing the poor up is the hardest issue to solve, a big part is environmental.
Yup. 1 person I have ever met has made it to Wall Street and everyone in our town thinks he is a bank teller in NYC and doesn't understand why he can't just do that back home.
It's more than playing a big role, it is THE defining factor.
As a lower middle class latino who grew up in the inner city I absolutely agree. That being said, being black/latino in a major city or inner city (aside from gun and gang violence or any other danger) is soooo much easier to succeed than being a poor or lower middle class white kid with an ok house in the south or a fly over state. There were so many college recruitment and preparation programs given to us in high school. Local business leaders and corproations would sponsor summer camps, trips to their offices when we were in high school, etc.
As a non-minority who went to inner city public schools in NYC my whole childhood, I agree, but only partly. While the opportunities for the best and brightest are much better in the city, I think the results for average kids are a whole lot worse. Sure, if you can test into the 5% of public schools in NYC that have produced Nobel laureates, you're going to get a stellar education. But if you're not competitive from an early age and intentional about pursuing that, you'll end up at places that don't serve as a pipeline to success. I.e., I think inner city schools are meritorious in that they reward the best handsomely, but they are elitist in that the rewards are distributed very narrowly across the entire spectrum. For every one amazing school, there are 5 mediocre ones and 4 abysmal ones.
I would say this is due to the lack of guidance in low-income communities. We've never had or known anybody to look up to when making major life decisions. "Making it" at one point just simply meant hopefully having a job after college, maybe..
I can almost confidently consider it LUCK that I happened to stumble upon IB, S&T, AM, PE, or whatever, in college. Although it is a huge disadvantage it does show how dedicated you are if you are able surpass this stump.
No matter what, I always believe it is important to take pride in coming from a low-income background!!
Growing up poor can make it harder to become rich. But growing up rich can make it harder to become successful. These are two different things, often confused.
one could make the argument that growing up very wealthy could make it more difficult to be successful than growing up in a lower-middle class family, depending on your definition of success...
idea of the inverted U shaped curve
Yeah, that is what I was getting at. Fully agree with you.
Indeed. An inverted U shaped curve is the go here. Too poor no chance for a decent education. Too rich no hunger. Middle class blues mixed with grit and hunger could be a momentum provider, helping to burn that mid night oil day after day after day.
Maybe mid to upper middle class. Definitely not lower middle class.
The issue is that people (like me) who grew up lower/mid middle class come from families where typically nobody has ever been exposed to the careers, strategies, attitudes and norms needed to make it to the 1%. There are always exceptions who 'figure it out' on their own, but the path is harder and takes a lot of awareness. I eventually did figure it out. But I'm going to provide some personal anecdotes as to why lower middle class is more disadvantaged than you may realize.
Some examples: My parents told me its not wise to study for the SAT's, because they're meant to place me at the appropriate school. My parents are not stupid, my mother is incredibly smart, this just seemed right.
I was taught to go to the cheapest university I could get in to or the one with the most scholarship money, and schools were rated purely on 'good' school, 'decent' school, community college and the unattainables (which frankly I probably could have gotten in to a top 10 or 20 undergrad if I took my applications seriously).
The idea of professional networking was incredibly foreign to me until my 20's. Neither of my parents have ever attended a networking event. The only time they would be handed a business card was when someone was trying to sell them car insurance.
I was taught that you wear a suit to interviews, so I should go to Marshalls and spend $100 on the cheapest suit I could. The thought of a tailor was a laughably unnecessary luxury.
My public high school was mostly lower middle class. 0 students went to a top 10 undergrad out of 300-400 in my graduating class. There are zero people from my high school that are in PE, VC, Consulting, Banking or other high finance role. I know of a few business owners who've done OK, our valedictorian became a doctor, most top 10 graduates of my class are now teachers. So the high school network is zero value. Having rich friends growing up certainly helps social mobility and professional success later.
My grandmother thinks it's crazy that I'm pursuing these 'fancy' jobs and not taking a good, rewarding role like social work or doing something with the environment. My father can't explain what I do to his friends but takes a lot of pride in my sister's local government role. There are a lot of disincentives to success. The 'chip on the shoulder' can certainly propel people but not many people develop one AND have the intelligence and fortitude to overcome the other shortcomings.
These are just some random anecdotes. But this stuff is very common at lower middle class and much less so at upper middle/upper middle class. There is no 'step up' to success coming from this background. And I spent a long time in private wealth management. The wealthy definitely have plenty of advantages that more than offset the potential lack of drive. Only a rich kid can not work from 22-25 then walk into a role at dad's friends company at 90k + entry level to get promoted a year later over someone working twice as hard as them.
Probably the stupidest thing you've said on this site, and that's saying something.
I grew up middle class, not rich. I lived in a rich suburb. Think of my family as living in Nick Carraway's little house next to a bunch of big mansions like Jay Gatsby's.
When I succeed as a middle class kid, I know that, while I had some advantages over poor people- especially because I grew up in a neighborhood surrounded by rich people- my success isn't coming from Dad.
Someone with the last name of Kennedy, Clinton, or Gates, OTOH, has a lot more to live up to.
I think that is just TNA's point.
Outliers by Malcolm Gladwell covers this topic well
Please elaborate
I don't really know where this fits in...I'm a few whiskeys in. But ever realize how immigrants that come from poorer countries work their ass off? Meanwhile we have poor that are citizens here and they sit on their ass? I still can't figure this out. And before anyone makes a shitstorm out of this comment, I'm not generalizing an entire group, there are just some that abuse the system.
Yes I agree and this is evident in Australia. However the immigrants who come over to the US/Australia from 'poor countries' are usually very well off in their country and about average in the country they move to. Of course I am talking about legal immigration in this instance
I'm thinking most South/Central Americans and Africans that come to the States generally work hard. Someone is probably going to mention the Latinos that are drug dealers, but I am just going to guess that the number of those that are actively seeking mundane work to support their families is far greater than those that come here for the drug trade.
This is a total stereotype of course but Indians that come here - those that were wealthy - feel entitled even in the States. Never really noticed it until a friend that was working as a waiter said that Indian people don't tip well and they treat you like shit - then I thought back on a few examples from my life and I recalled some fitting experiences, and ever since then I still see that (e.g., just the other day, this bunch of them were taking up the whole sidewalk and I was coming towards them, expected at least one to move so I can get by....nope! Guess I'll just stop and wait). Obviously they aren't all like this, but it is definitely something I've picked up on.
This sounds like a fine discussion to have while drinking whisky,
I think there is a little more to it than that. Immigrants who come here from poorer countries still tend to be middle-class or higher in their own countries. Getting a Visa to live/work in the US is hard - it costs a lot of money and things like work visas require the person to be a fairly smart individual.
The immigration process basically is a filtration system that brings in (mostly) the most able people in terms of money and education. In their home-countries, these immigrants held the same socio-economic status as the people who are "doing well" here - but now that they came here to start a whole new life, they have to (usually) start off at a lower socio-economic status and work their way up. This creates the perception that these poorer immigrants do better than poorer non-immigrants - but in reality its a kind of a false equivalency.
Oh definitely a perception. I have no facts to back up anything.
Thomas Sowell has written many fantastic pieces about this, and also has a number of good interviews available on youtube (through the Hoover Institute). It all comes back to Culture...
My parents/family is the same way as the above poster. They'll tell me to take an MBA at any school if I choose to go that path. They have no idea how little an MBA would mean to me if I got it at Fordham or Penn Stateor the local city college. Not saying Fordham is a horrible school, but I would never shove out thousands for an MBA unless it's a top 5 program, because it's never going to give me the return I'd expect. The same thing should've applied to my undergrad program when it came time to select it, but I didn't think in these terms back then.
I think most people feel that growing up wealthy is: first, boring as hell; and two, not very impressive when anything good happens. There's not a lot of hard work, luck, or success in working at your dad's firm no matter if dad is a carpenter or owns Moelis & Co. In fact, the only people that are on the balls of wealthy kids is the media and it's probably because they either grew up the same way, or were their best friends when they got 'lucky' and accepted into their top college.
In defense of what might sound like bitterness, I have met and currently have friends who grew up upper middle to wealthy. And after looking at their lives and mine, parents have a lot of influence in the outcome of their child's life. None of these kids are as 'smart' as everyone wants us to believe about them. They just seem like there were a lot of strong influences at home that built up their efficacy in certain areas, and even more so, it's as if they were given ample opportunity to flex muscles that poor people never get to. I'd hire a bunch of regular wealthy kids to work in certain areas of my company too, given that I'd know they could probably do what I tell them with good interpretation of the rules.
Short comic strip that sums this up quite well:
http://thewireless.co.nz/articles/the-pencilsword-on-a-plate
I think coming from a privileged background gives one a tremendous upper hand in terms of getting experience. I come from a wealthy family but they are in race horses and farming so I had to make all my contacts myself but chatting to some of my mates over the past two weeks- 2 got into an reputable boutique and did't have to interview just got it through family connections Another into a top Asset Management firm as the guy owed his dad a favour (No interview) Another into a top REPE firm due to family contact The list goes on.....
The point being there are plenty of kids with far superior resumes, but just lack the contacts and can't get anything. I guess it's the way the world works
I think income inequality plays a large role, but I believe a child's home environment and the values his or her parents instill is even more advantageous. I grew up in a middle-class house, and no one in my immediate family or even extended has worked in business (mostly blue-collar, nurses, cop, etc.), but I was raised in a supportive environment and to work hard. Obviously, my parents had no idea what IB/S&T/consulting was (or even is) but if I had a goal (career or beyond) they were supportive and instilled the values of hard-work so that I was confident I could figure it out.
Does water make things wet?
In order:
Q:Do you guys think the income inequality is playing a big role in how individuals turn out?" A: Maybe a little bit, but wealth inequality is what you (and Yellen) are really talking about. Politicians like to conflate the two b/c we have an income tax and errybody has an income (so the political returns for bitching about income inequality are way higher).
Q:Can you identify a solution that may be able to fix this issue Yellen points out? A: This is not an issue (in my mind), but if it was, the only solution would be to create a socialist society (which creates worse problems than it solves). In my mind, the problem is NOT income or wealth inequality - it's that we've created a system of frictions and suboptimal incentives that prevents this wealth from being deployed properly.
Btw, it's worth noting that of all the possible sources of 'inequality', income inequality is one of the least problematic for society. Don't believe me? Here's a short list of attributes that have been demonstrated (at least in academic studies) to have a meaningful impact on your earning potential but create 0 value in modern society (ignoring the politically sensitive ones):
Deepness of voice (for men) Height (for men) Attractiveness (men & women) Weight at birth (men & women) Whether you were born in an early month or a later month (men & women)
At least being wealthy (in theory, anyway) should contribute to the amount of capital available for investment in productive assets (hint: this should include the 'smart/hard working, but unfortunately poor')
Q:What is more impressive to you, creating more with what you are given, or sustaining what you are given (in this example at a very high initial level) initially?
A:This is a loaded question, with the former obviously being more impressive. Of course, if you're basing this on a categorical assessment of income/class (e.g. poor, lower-middle, mid-middle, high-middle, upper), you're penalizing the wealthy right out of the gate (not saying you are doing this). If you're thinking in the context of ROI, what you're given should be a non-issue as long as it's greater than 0 (again, acknowledge this is not practically true for 100% of cases)
You can argue "well if you grow up rich than there is a chance that you you won't be successful," but that is not question at hand.
Success (at a foundation level) is usually directly correlated by access to resources. Those primarily being (in my eyes) - education, network, and financial stability. These are all resources that wealthy families have access to (private schools, professional/global network, and money).
We cannot get caught up in the idea of 'outliers,' such as the one kid from your hometown who grew up on foodstamps and is now pursuing an MBA, nor the example of your dad's golfing buddy whose kid went to UPenn but got addicted to painkillers. These are outliers, not the societal norm.
Here's a quick example - I was fortunate enough to go boarding school. On my floor alone there were kids from NINE different countries, better yet from all over the US. This creates a worldwide network starting at the age of 14 - a significant step above kids who do not have the same opportunity.
Yay another anecdotal evidence vs statistics thread!
Upvote for this x1000. It consistently impresses me how willing WSO members (and people on the internet generally) are to make sweeping assertions without offering an statistical evidence (and, FWIW, statistics /= statistical evidence).
The only thing more impressive/frustrating is that, after deciding that it's too much work to compile statistical evidence, people immediately proceed to anecdotes / ad hominem attacks, they totally ignore the fact that you can have a conceptually sound, logical argument even if no numbers are used, as long as you agree on the premises at the outset.
being able to have parents to pay tutors to prepare you for college, SAT prep, and for target school tuition definitely has a huge impact. rich kids have it a hell of a lot easier, but by no my means is anything impossible for a poor person.
Yes
Not only does it matter, I would say it's one of the most critical factors. I grew up in a very well-to-do family. I went to school with (mostly) kids from other well-to-do families. My friends' parents were lawyers, business owners, executives, doctors, bankers. I knew what a hedge fund was at age 10. If I slipped up, I knew there was a safety net there. My brother slipped up big time (twice) and started fresh at 25 in a way that no one without my father's connections could have. At my high school, people would look at you askance if you weren't applying to at least one Ivy league school. Top colleges were considered the norm, not an exception. Even if I didn't fully appreciate the value of networking until later in life, just being "social" at the schools I went to has left me with an incredibly powerful network. Of the 17 guys in my fraternity pledge class, ~13 have gone to grad school in medicine, business, law or engineering, all at top-15 (mostly top 10) schools. Through them I have access to networks from almost every top school you can think of.
So, does anyone think all of the above doesn't matter? Yes, I occasionally had to work hard and overcome some obstacles, but compared with your average person my path might as well have had 20 ft high guardrails on it.
Yes, I'd say it's much easier.
I'm from a very, very small town out in nowhere. Only 5% of my class went on to higher-education, the rest are either working dead-end jobs, on welfare, or unemployed.
The biggest difference I see between my peers from home, and the people I knew from college (best business school in the country), is that the guys and gals from college had very good and specific mentoring from early age. While most 12 year olds wanted to become athletes, firefighters, cops, construction workers, etc. These guys wanted to become traders, lawyers, doctors, bankers, business owners, etc.
Why? Because that's what their parents were. And they also got private tutoring and mentoring from a they were kids. So while other teens were out playing ball for 6 hours a day, or partying, or whatever, these people were studying for exams, admission tests, and such things. They know that to maximize chances of getting that specific job, they need to go to that specific school.
By the time they're college juniors, they have the next 10 years all planned out. The regular Joe's will first hear about Investment Banks / Management Consulting / etc. when they're College seniors. And by then, its too late. They picked the wrong school, didn't study hard enough, etc.
But ok, success is very subjective. Those I describe are aiming for upper middle class, or the "regular" rich class. Only a small part of that group will go on to become wildly successful in life. If you're aiming for a steady $350k salary for the rest of your life, going to a prestigious school and landing a prestigious job will be enough, at least for your career prospects. My experience is that when you look at workers in those kind of jobs, a huge majority will have background from top schools, good jobs (straight out of college), and good business schools. Sometimes you'll find some truly self-made people, that had to swim upstream from young.
It's much easier when you have successful parents that can make all the correct decisions, and can back it up with the cash needed. This is not just the case for white collar jobs.
Look at the entertainment industry. There's a ton of musicians and actors that all came from privileged homes, went to excellent schools, and could focus on their creative endeavors. Hell, sometimes the studio has to make up a new persona for them, so that they can look "real" enough for their fans. (At least for musicians).
I've never understood why these threads always devolve into arguments. If you are white, male, and/or upper middle class, the fact that minorities, women, and poorer people had a tougher time that you did does not diminish your accomplishments. It's like the whole non-target vs. target argument in IB. Yes, the kid from UT San Antonio or UM Flint had a tougher time breaking in than the kid at Harvard or Princeton, but that doesn't mean the Harvard and Princeton kids' accomplishments are any less- it's just different.
The funny thing is this thread is a pretty good topic. Nobody has went out of their way yet to actually define "success"
The argument that it's only a lot harder to be successful if you grow up poor or in the lower-middle/middle class is flawed for obvious reasons. The people who grew up in these places flock to this thread to assert why their circumstances were the hardest (cognitive bias maybe?), and it can't be any other way...
I grew up in the middle class with my mom and step-dad (horrible step-dad but he did support us-basically I grew up without a father figure) not knowing anything about how the system works/operates...
First define success...
Success is not only dependent upon the bank balance...
If you were to add up all the years my parents attended school throughout their lives, it wouldn't even add up to 10. My mother grew up in a small European village, and my dad grew up in bumblefuck Africa. They, along with many other members of my extended family, immigrated to America and virtually everyone, to this day, works their respective blue-collar jobs. Growing up, the most "business person" in my family operated a small fish market in our community.
Much of what I grew up with is mentioned in BreakingOutOfPWM's post above. I went to a high school that ranked in the lower one third of public schools in my state when I graduated. I declared my major in college the last possible day and went with "Finance" after googling career prospects for the respective majors my business school offered. I honestly think I left it to the last possible hour.
In terms of "getting the big picture" and "understanding how the system works" I have to thank WSO and you monkeys for starting me on that path. Shortly after declaring my major, I randomly found this website, saw all the aneurysms people were getting over internships/SA positions, and this kicked my ass into high gear and prompted me to reach out to one of my professors at the time about these "internships" I kept reading about. He immediately put me in touch with his financial adviser who was looking for an intern. I still remember calling my friends to tell them about this opportunity I might have at "Morgan and Stanley". Yeah, I was pretty fucking clueless. Luckily, this financial adviser I had really took me under his wing and EXCESSIVELY PUSHED me to network with alum and anyone else who would talk to me. This was invaluable.
You mentioned nobody here has defined success, and I actually don't have the answer either. I think it might be because success is relative and different to everyone. The first time I really felt "successful" was just a few weeks ago, after getting rejected at an MBB after being well into their process. Shortly after that I looked up the LinkedIn profiles of people that currently have the position I was going for, and I'm not exaggerating when I say that every single person had seemingly attended top schools since they were born. I remember going through the list and thinking there had to be an exception somewhere, and found one person having gone to a public high school, and it turned out to be some NYC school ranked the best high school in the country.
I'm still in my twenties so I'm not going to call myself a success yet, but when I realized I was most likely competing with kids whose parents shelled out more on a year's worth of boarding school than my parents were able to ever give me for all of college, it was the first time I really felt I was going in the direction of being a "success".
Great story, I can totally relate haha. I had my PWM interview at 9 AM after an overnight shift at my blue collar job. I had my chip on my shoulder at this point. My hiring manager commented that I looked a bit tired when I walked in. I apologized and let him know I had just worked 18 hours after 12 days working straight in my other job. He went quiet for a second. He asked me why I wanted to work in private wealth. I replied I didn't have any clue how finance worked but I figured it was a great place to learn, and I'd work harder than anyone he'd ever met.
He didn't hire me, but did end up hiring me 9 months later after I applied to three other jobs on his team and stayed in touch. I almost got fired three months later because I had no idea how a professional environment worked and had nobody to coach me. I got my shit together, found a mentor or two and ended up with stellar performance reviews through the rest of my time there and one of the fastest promotional records in division history.
Trust me, I don't define being successful as having the values needed to work 12 days straight flip flopping overnights to days for the same pay as a GM at McDonalds. I define it as having the work ethic but also the ambitious attitude, support network, professionalism and EQ to succeed in an environment that compensates for true worth, allows one to provide for themselves and their family and allows one to sleep well at night knowing they're working towards achieving their career goals and provides milestones to work towards.
I also had a similar epiphany regarding consulting and top schools. I applied to every firm out of undergrad and had no interviews. I decided to work towards a good b-school, I'm headed to a top consulting firm after my MBA. Not MBB, but I had the opportunity to interview at all three and it's pretty damn close, I'm happy with the role. I'm a bit older than you, you've got time. Keep it up.
"Success is not only dependent upon the bank balance..."
You're right. It depends more upon net worth, which is a combination of all your assets including cash, stock, real estate, gold, etc. If you're smart, you have more money invested in non-cash assets that appreciate
my point is success should not only be defined by money...
Lies from the liberal media. Being poor actually means you're rich
Liberals would be the ones arguing why their situation was the toughest (victims), unable to see things any other way and completely ill-equipped in dealing with the truth...
This post struck a very personal cord about my own journey in life, so I am about to get a little wild with it. There will be humility and bragging. If this doesn't interest you, then no need to read on fellow monkeys.
I made the journey from very poor to upper middle class, and still climbing. when you have nothing you are hungry. not just for food, but for meaning. why am I here if I don't know where my next meal comes from? that makes you bold, a risk taker. I took on massive student loans on the chance that I would work my ass off and get a good job. I graduated in 2008. Shit time to graduate but i still got a nice job because my GPA was top notch, my extracurriculars were second to none and my smooth talking salesmanship (well honed while poon hounding on campus) helped me get my foot in the door. but foot int he door, a chance, is all i needed. I knocked it out of the park at my first gig, not because I was so skilled but because I was eager to learn and learned it quick so I kept asking more work and kept getting promoted. Even now I am known as the guy who get's shit done. You want to make sure things are done and are done right? I am the guy. But not just run of the mill stuff. That doesn't interest me. I am the special situations guy. Some people dread the very mention of the word "ambiguity" - but me? I am it's motherfucking wrangler. I love it, i thrive in it. The more complex the issue, the harder my dick get's figuring it out. I am a team player and a lone wolf. I am a chameleon - I can handle most situations (not so great with handling crying subordinates). I still work 12+ hour days ... not because I have to, but because I want to. I remember what it was like having nothing and I would rather turn into a zombie before going back there. You either have the hunger or you don't monkeys. I split my achievements into little bits and always aim higher and higher always looking for more. Not because I am greedy but because once you get a taste for success you cannot stop. It't the ultimate drug. Cliche I know, but fuck it's true. When you start poor and then make it to middle class and on your way to 1% and higher, you have so much appreciation for life and the things you have because YOU EARNED them ... was not handed them, but you earned them. Same way that game meat I hunted tastes a little better than supermarket meat. I am a hunter and I take pride in my work and will always remember what it was like having NOTHING and that will propel me to keep trying, to keep getting up, keep going balls deep no matter what, until the day I die. Even then I am going to drive Satan himself mad because I will keep going after his job (fyi - you either get into heaven or you get rich; can't do both).
Stay hungry fellow monkeys!!!
Wow. That was a ride. I'll buy it.. matter fact, I'll take two.
This made me chuckle, so thanks for that. :) Salesmanship is important after all, right?
It really does depend on how you define success. A lot of people would find more personal fulfillment and meaning from a job that doesn't require staring at a screen for an ungodly number of hours and making as much money as possible. And there's also a difference between what's successful and what's impressive. Person 1 grew up wealthy, went to a top school, and ends up at a top firm. Person 2 grew up in poverty, went to a state school, and ends up at a top firm. What's more impressive? Person 2 impresses me a lot more, but they're both successful, at the least in the way it's defined on this forum.
And another point to be made is that going to a top school almost ensures that you won't have a problem joining the ranks of the upper-middle class if you put in the effort. Sure, not everyone gets top offers in their desired industry, but most kids who have their head on straight don't have that much trouble scoring a decent gig. But is it really all that impressive to follow a laid out, tried and tested path that brings long-term success? I personally think successful entrepreneurs are a lot more impressive, since they often put everything on the line, and have real skin in the game throughout their entire career.
I don't think the strata you start in absolutely determines your future success. Data seems to bear that out. There seems to be a lot of motion in the US between income quintiles. See this kinda preachy article here, that has some data on income movement.
However, where you start can set your personal expectations and either drive you to success or drown you in failure.
I grew up middle-middle class. My expectation was to go to college and become a professional. My parents went to college, my siblings went to college. My family's friends were professionals who went to college.
I put myself through college (working and some veteran's money that I earned via 4 years in the Air Force), but it was having that internal drive that made me into the successful engineer that I am -- not who my parents were. Later in my career, that internal drive and willingness to take on risk helped propel me into the 1% -- again, not my family connections.
My parents did help me set and shape those expectations. They did help guide me back when my life looked like an abysmal failure (college dropout, no direction in life). For that, I'm eternally grateful.
In the end, though, I feel that income inequality stems from expectation inequality. There are opportunities for all, but without setting your sights high, you'll never get there. Yes, you may have disadvantages. Yes, that sucks. But the way to fix it is to do the hard work needed to fix it -- there isn't a shortcut. It is hard work, a bit of luck, and an eye for opportunity!
Yeah.
It really depends on the person. The obvious answer is yes, because poor people are not initially exposed to the connections/opportunities that the rich have. But the flip side is growing up poor [should] instill an inner drive to escape the velocity of poverty and provide a better understanding of the true value of money, something the born rich may not be as cognitive about (i.e. not having to budget). I have buddies at school who grapple with whether or not they want to take over there parent's business and coast through life or do it on their own. I always tell them while I didn't have the first option, I thoroughly enjoyed working many jobs and busting my ass off because of the tough mindset and work ethic that some of my peers do not have.
After working with both the poor and rich, I've had better times working with the poor and notice as long as they have the essential necessities, they tend to be much happier than corporate slaves.
There's not really a clear solution because the importance of money varies person to person, but a good step would be a basic personal finance course early in education. It's up to the individual whether to utilize the knowledge or not.
As someone who has grown up in a well-off family and watched both of my siblings flunk out of highschool, I have to disagree with the notion that initial wealth = success that some people are preaching. It certainly helps to have the infrastructure in place but with no motivation or desire to succeed financially, you can certainly fall off of a cliff fast.
I always taught of it as opportunity inequality all people are not equal and we should not be equal but we need to have equal opportunity to succeed and excel
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