In this day and age should you pursue an advanced professional degree i.e. medicine, accounting, law, engineering, etc? We know that the average doctor pays off their educational debt at 58 years old and dies at 62 years old. There is no question advanced degrees are valuable but as they relate to hyper-growth and wealth building they can be a hindrance. This podcast can’t be missed.
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Advanced Degrees Yes or No?
This podcast is going to be a bit interesting. I was asked what is my take on the difference between people going for an advanced degree, a Master’s or PhD, versus somebody just strictly going to high school, maybe junior college or even college but definitely not a Master’s, with the sole purpose of starting a business sooner. I have a lot of opinions on this topic. I’m going to hit it from a couple different areas. I’m going to start with my sister-in-law and my father first.
My sister-in-law has close to $400,000 worth of advanced medical degree debt. She owns a practice. She is under tremendous strain trying to figure out how to ramp up her practice fast enough because of the town she’s in. She didn’t have the ability to start with someone else, so she literally had to bootstrap it. Not only did she have to pay the schooling, which is pounding on her, she had to pay the startup cost to launch this practice. She’s one stressed-out human being. I’m going to touch on a few different things. I’m not saying don’t go for a medical degree. I have other family members that have the same amount of medical debt that have different circumstances and they’re absolutely killing it.
I want to talk about my dad. My dad is definitely the smartest person I’ve ever met. I may have said on a couple of podcast awhile back that in the days of the ‘80s and ‘90s, we would literally play Trivial Pursuit. It was my dad, and this is at Thanksgiving and Christmas, at least twenty people in the room, a lot of them are very sharp. My dad versus twenty people, and he’d win hands down. We don’t know if he has a photographic memory or just uber smart. He went to U of I, which is a very difficult college to get into, straight As in pre-med. He called his father the first week of the second semester and he said, “I’m getting straight As. I am not wasting your money but this is not for me. Can I come home and work in the restaurant?” My grandfather was so happy he’s like, “You get your butt here right now.” Needless to say, my grandfather then funded a restaurant from my dad to run. My dad eventually owned that and built a great life. He retired early and he’s in Florida all the time having a great time.
I want to hit this question a little bit mechanically because where I am definitely not a fan today of our school system, this is not a political comment, I just can’t stand when we have a system where the average doctor gets out of debt at 58 and dies at 62. There has to be a better way, and I don’t think it has anything to do with government assistance. It has to do with what we teach. We need to teach more business, more growth, more sales and more marketing. We have to teach the principles that keep couples together and keep businesses growing. I hate beating a dead horse, but how can we be a five-time Inc. 5,000 company moving three different products? How is that possible? We know some fundamental basic business principles.
Sticking on this topic, what is my take? Here’s the exact question that came to me: “Ken, what’s your take on advanced degrees versus real world experience?” This one set me off. I want to describe something that our company is going through right now. This comes from a very famous consultant, author, who is our current consultant, David Corbin. If you have not read David’s book, Illuminate, shame on you, go get it please. I have mentioned it a series of times on this podcast. It totally changed our business. The concept is David teaches a principle that all companies growing slow or quickly, at some point, the growth hits a point where you have to flip a switch and go from barbaric to bureaucratic. It’s not a negative thing, it’s a systems thing. You can’t stay barbaric.
On the flip side, if you want to grow quickly, especially from a one-person shop to a hundred-person shop of whatever industry, it doesn’t matter, it’s very difficult to grow quickly bureaucratically. There’s a phrase of companies that are Microsoft-type companies versus Procter& Gamble-type companies. At Procter & Gamble, you need five different signatures to buy a ream of paper. Microsoft went years and didn’t even have doors on their offices. You could literally walk in and scream at your boss if you had a better idea. If you want her to buy a ream of paper, you ask forgiveness later and you bought five reams of paper. They were barbaric as long as they could hold on to in their hyper-growth phases.
Smaller companies, 100 employees and smaller, I really hope you’re in a barbaric mindset. Think of a barbarian. They got big tools. They knock things over. They need to eat. They hunt every day. Barbaric companies hunt for the next client. They hunt for the next small system to build. They hunt for a better email system. They hunt for the next executives. They’re on the prowl. They’re growling at all times. They’re almost always angry in a great way. You’ve got to be barbaric. If you try to grow a barbaric company, say you’ve got four Master’s, PhD degree people in your first ten people, I’m going to predict in-fighting and a tremendous amount of lost opportunity because academics, they like to analyze and overanalyze things.
To scale, often you need to remove that academic mindset. If you have a master’s or PhD, you definitely have been pickled a little bit. I don’t care what your degree is in. You have been pickled a little bit in slowing down to go fast. The academia, and I have a few academia here, they want to slow and check everything and cross Ts and dot Is. From certain industries you go, “You need that.” Of course you do, but that’s what you hire an attorney for. That’s what you hire a consultant for. You don’t necessarily need to have the embryo engine of growth academia. Bottom line is academics aren’t taught to take risks. My single greatest problem with our college school system is its risk avoidance.
Let me teach you to go get a good education so you can go get a good job and have a great life. That sucks. Why does it suck? If there aren’t entrepreneurs taking risks to start the next company, who are you going to go get a job working for? Why not be you that starts to company? “I’m built to be an engineer. I took all the tests. I’m built to be an accountant.” Bullshit. In 1900, 100% of people almost had their own business. 1880, 100% of people. How do I know this? The definition of the word ‘job’ in the 1905 dictionary was a temporary means of income until your business took off. Everybody owned their own business. You were a farmer, a blacksmith, a pharmacist, a bricklayer, a roofer. You built roads. There were a few people in government, few people teach in school, but the majority of the world is a business owner. They’re scrappers. For someone to ever tell me, “I’m not wired to be a business owner,” that is crap. The reality is there is safety and security into going to school, have someone else pour into you, and then going to work for someone else that opens the door and shows you the way. It’s safer.
Not really. If you look at all of the real studies, more people stay married that are business owners, that’s a pure fact. Jobs are not necessarily safer. I want to be clear. Going back, the question was, “What’s my take on advanced degrees, not just college in general?” I would be ecstatic if all my kids went for a master’s degree as long as it was an accelerated course. My daughter’s at Pepperdine. There’s an accelerated Master’s. She stayed one more year, a fifth year. I’m not in the two to four-year master’s degree mode because that puts my daughter eight years into further academia and eight years further away from reality.
The reality is everybody in the audience is a salesperson and a business owner, 100%. Everybody in this podcast owns You Inc., Your Name Inc., and you are a huge salesperson. You’ve sold someone on dating you, you sold children on behaving, you sold banks on loaning you money, you sell yourself everyday that you’re great and things are going to improve, you’re a salesperson. You’re selling everybody around you your ideas and your vision, whether you’re a business owner or have a job. You are selling all day. If you’re a salesperson, you’re incorporated. You got to look at it that way. You are a business owner.
I have no problem with them going for a master’s as long as it’s accelerated because I want them fast tracking in the best job they can find if they don’t want to come work here. I want them fast tracking in the best job they can find with a no-ceiling income opportunity, which puts them in mentally as a business owner. It gives them the opportunity to grow quickly or realize, “This isn’t for me. I’m best served working for myself taking risks.” Two of my kids already think they’re going to take my seat. I love it. I think that’s fantastic.
What is my take on advanced degrees? If it’s an accelerated program or you can start some of the classes early while still going to regular college, I’m all for it. If it is an exhausting two, three, four, five, eight years and there is no financial break for trying to accelerate it, then you have to add up what is called the opportunity cost. What is the loan to go to that further schooling? What’s going to be the interest rate? Multiply that by the years you’re not going to be at a job or earning. You’ve got to add up those earnings times what you can make with the earnings and savings times the opportunity cost of what if you could do a job and then a consulting thing on the side, real estate on the side. You make a living nine to five, but you make a life from five to nine.
If you have a job, you better have heard episode number one in my Today’s Growth Classics. It’s a different podcast channel and you hear episode number one, S-curves. You better be doing something nine to five on top of your job, separate from your job, because 100% of main sources of income fail 100% of the time. You can have an advanced degree, that’s fantastic, but if you get an advanced degree to go get a job and 100% of main sources income fail 100% of the time, if you don’t believe this, start tracking everybody you know. Write down the job they’re in, and then call them in seven years and see what percentage still have that source of income. It is going to be really small. The business owners, that’s going to be very high. That’s different because they can keep stacking s-curves inside their business. I’ve hit the point pretty well about my take on advanced degrees. Take care.