Thursday, June 17, 2010

Career query of the week

The amount of thought, logic and reason some of you put into your career-related decisions never ceases to amaze me. Here is one such 'thoughful' young man.

I am currently in a junction point of my career. I got selected for the MS(by Research) program in Finance(Finance+OR+Maths) at IIT Madras. I am currently working as Software Engineer with XXX (leading MNC IT co). I will quickly mention my credentials and then go to my question.

I have 92% marks in 10th standard, 93% marks in 12th standard (both from West bengal State Board) and 9.14 CGPA in Computer Engineering (3rd Rank in class) from NIT XX. I have been working for 3 years after my B.Tech.

This MS program will give me either an analytics job (current recruiters are Irevna, HCL, ICICI etc) with a package of 7.5-8.0 Lpa or I can get admission to a good Finance PhD from one of the top 10 US Universities (with IIT tag and good reco hopefully!).

My question is whether it will be a right move for me to join this course given some other possible career moves:

1. I can take GRE this year and apply directly for PhD in Finance from tier 2 US business schools.

Pros: I can finish PhD by at least 1 year early and enter Job. My 2 years in MS will be saved.

Cons: Acceptance rate for Fin PhD is very low: around 2-5% as many Maths/Physics PhD, fresh MBA from top B-Schools opt for the same. I may not even get into a reasonably good school (Like UT Austin, USC, Maryland etc) (are my assumpsions correct?)

2. I can take CAT this year and get into IIMs

Pros: I can enter Finance job market early and probably decide over PhD after doing job for a couple of years.

Cons: Getting into IIM A/B/C/L is highly uncertain. This year I got only 84 percentile(without any preparation, my father had collected the form). With good preparation for next 5 months I may get good score, but, even then I am not sure how much worthy it will be to join IIM I/K or MDI/SpJain/NITIE after 4 years work ex in a top company.

3. I can continue with my job for another two years and write GMAT and get into 1 year Exec MBA from ISB/IIM A/ IIM B/IIM C.

Pros: The opportunity cost will be less as I will be working more and can save some money to fund my MBA partially.

Cons: I will probably not get a Finance job at all/ get entry level job after 5 years of work ex in software field.

My premises are:
1. I love Mathematics, Statistics, Theoritical Computer Science, Algorithms. If money was not a factor I would love to do advanced studies and research in these fields. PhD in Finance or Financial Engineering would be a good fit based on my area of interest. But also I don't want to reduce my earning potential by 50% for the rest of my life if it (Phd) means so.

2. I dont like classes that teach leadership kind of stuff (attended some corporate trainings) and I am not a typical sales guy. I hate HR also. Historically I did not participated much in the kind of tasks which required managing or influencing people a lot (eg. organizing college fest, raising funds for the same, contacting companies and alumni etc)

3. I am not very passionate about technology and so to continue in product company may not prove very fruitful for me.

4. Business PhD and specially Finance is always more rewarding than Engineering PhD. With PhD I will have both options of Industry(I-Bank Quant jobs,Consultancy) and Academia open. I also love teaching. I teach underpriviledged kids at a local school in Hyderabad on weekends.

5. I can't afford the financial risk of Foreign MBA/ Foreign MFE (Master in Financial Engineering) given my background and the house loan I have taken already.

6. The opportunity cost of a PhD is very high as compared to MBA since I will enter the Job market at least after 3 years.

7. I am 25 years old and unmarried.

If I join the MS-Fin course at IIT, my motivation will be to join top 10 US PhD-Fin programs and not job after MS. Do you think it is a right career move on my part given my premises/credentials/possible options? Please put your thoughts across.

My response: Dear Young Man, clearly,
a) You are not passionate abt technology.

b) You want to make a lot of money, quickly, in the field of finance.

What I am not clear is, why PhD? Because you won't be burdened with a loan is your logic.
But my dear time is money - a PhD will take 3 years (at the very least) while an MBA can be completed in a year or two.

If you get into IIMA, B or C (you have not even tried for it seriously) - you have high probability (given yr profile & inclination) of getting into a 'high paying job' with an i bank or similar.

Paying off the loan would not be an issue.

Now you are a mathematical chap who is always weighing the possibility 'what if' I do not get in. Life mein itna belief rakhna padta hai.. u have to take a leap of faith and give it your best.

After your best shot, if you don't reach your goal then yes, you look at options like MBA abroad from a top school.

Just remember, hurry creates worry. So be ambitious but also patient. All the best.

Young Man replies: The logic behind PhD is:

1. It gives a sense of achievement of a topmost degree. Taking IIM A/B/C and ISB together annually ~1500 high quality MBAs are produced in India alone. By simple demand supply equation PhD in business has a clear edge.

2. I will still have the option of I-Banks/Consultancy, besides the doors of Academia opens. (with the foreign university bill, specially business academia is going to be next happening thing)

3. As you wrote in one of your articles: 'As you rise up higher in the ladder, success is increasingly defined not by what you know or do, but how you manage and motivate your people'.

I think leadership and administration is not by strength area. True that I can do a descent job there with some training and grroming, but by natural instincts are towards Individual contributor (IC) path, where to build a good model and advising people the benefits of it can give me more pleasure. And in IC path PhDs will always be one step ahead of MBAs (hope this holds true in Financial job markets also).

4. I liked your advice "Hurry creates worry". But considering my dad retires after 5 years, I dont want to shift the burden of house loan and my family on my retired father in case I am going to do PhD after MBA followed by 2-3 years of work. So, agar PhD karna hai toh isi saal join karna hai. So it has now become a choice between MBA or PhD in Business.

5. And one bewkoof logic: many of my classmates from school are currently doctoral students at Stanford, MIT, Cornell etc and they are having no worse lifestyle than me doing a not-so-satisfying job I have right now. So sometimes I get the kick that I should have been doing some thing better, something more fundamental.

My response: When you have so much conviction re: PhD you should then certainly go and do it. However I would be happier to hear more of 'This excites me' rather than 'I don't like this, this and this therefore..."

An active choice based on interest and passion always works better than a logical one based on eliminating options.

Second point is, 'leadership' is always required, whatever you do. No man is an island, PhD or not. My father is a PhD in Space Physics and leading the team which is building India's first astronomy satellite Astrosat. Even though he may be a 'pure' scientist ultimately he is also a manager and administrator.

Lastly, EMI should not worry you to death. If it becomes a burden, dispose of the house and buy again after completing studies - when you have the money and secure job once again.

By the way, the EMI advice applies to anyone and everyone who wants to do something different in life. Live on rent, live without fear. You will own a house one day. You don't have to, at 25!

Do add yr comments/ advice for Young Man. Esp if you are on the PhD path yourself.


  1. EMI is really a sword hanging always .Even if a man earns ^5-6 P/A its qutie difficult as the house costs more than 25 laces and monthly heavy expenses are also there.
    There is always insecurity in life whether he is a PM or CM.
    He can choose any one whatever his conscious allow because one can give the best advice onself as he knows all his pros and cons.
    Whatever he does MBA or Ph.D. he must forget second one as chasing two rabbits means getting neither.
    It seems he is quite inteligent and higly ambitious.
    Go ahead fith firm faith and never look back dilemma is always fatal.
    He is going to win sure his battle of life.

  2. nice conversation .. it was a recall for me about me taking a decision in my life..
    Today you can achieve even more and not for working for some one else... Work for to help people.. you make good money..


  3. Frankly, I haven't come across anyone who has pursued Ph.D. because it offers better career (validity of that argument itself can be questioned.) They have done it because of the interest in that field.

    I'm also surprised that you talk about finishing Ph.D. in 3 yrs. Typical duration that I know of is 5 yrs. More over, almost 50% of students enrolling for PhD in US don't complete it. And, these are all 3.9/4.0 GPA students in their undergrad studies. (Check )

    Given how difficult earning a PhD is, you need a very strong motivation to do it. Great career is a rather weak reason.

    As an alternative to MBA, you can take up a job that fits in your long term career path, even if you have to take a small cut in pay right now. Doing something that you don't want to do in long run just for the sake money is also an opportunity cost.

  4. Hello Rashmi mam..!! Kindly tell me where should I post my career query..??

  5. what he hasnt indicated is whether he likes to sit poring over books on and on for over 5 years.. if u can, then u shld..

  6. I would like to congratulate Rashmi for helping people like this chap here. We need more blogs like yours which promotes a healthy discussion about ones career choice.
    I am currently working on my PhD from George Washington Univ. in engineering. I am a working professional in US and I am doing this as part time. Although I am part time but this course is highly paced cohort and heavier than full time PhD. I did my MS from US (UNC) as well and can tell that PhD in three years with MS would be one hell of a task. I doubt if any advisor from top US School would let you do that. For PhD one has to first qualify as a PhD candidate and for that only it takes at least 2 years of persistent work on top of course work. Qualification for PhD candidate from Top US school require at least one peer reviewed Journal article which would take minimum 6 months and that when you already have identified an acceptable research topic to your advisor and research committee.
    I no ways I am saying PhD would be tougher than MBA or MS in financial engineering, I am not in a position to make that statement since I have no clue about MBA. BTW phdcomics strips (piled higher and deeper) are sometime very relevant to a Grad student life working on their research!

  7. Hahaha! Funniest post in a while:). So tell me dear Phd path, since you mentioned somewhere in between that If money was not a factor you would love to do advanced studies and research.

    Here is a little hard fact: If money is NOT a big factor, you would like to excel in your PHD and do the very best for the one thesis you will work on whenever in life you get around to doing it. The income to pay off your upcoming emis will happen, a Nobel....maybe!

    Now please admit that money is indeed your greatest motivator at this early juncture in life, and proceed to queue for an M.B.A. from a tier 1 school.

  8. Very Good website. I like the contents. From

  9. Awesome advice on EMI. Live without fear. Thank god someone out there has same thoughts as mine. Instead of having materialistic wealth at 25, I prefer to increase my thirst for more and more knowledge and learning. Thanks Rashmi!!

  10. Regarding EMI, I think I did a smart thing. At 25, I own a flat in Bangalore. But I made sure that EMI doesn't bother me too much. So I chose a sub-25 Lac one so that I have to pay EMI of 17.5K I bought a 850 sq ft flat. Neither big nor small.

    So even if I want to go for studies later, I can recover 50% of EMI by renting the flat and the rest 10K for 2 years, approx 2.5 lac from my savings.

    As I get into job after my studies, I can continue paying my EMI.

    This way I need not compromise on flat or studies.

  11. I am enlightened my reading the post!

  12. Hope my suggestion makes ur life easy lil bit.
    I’m a B.Tech graduate from IIT Madras and currently pursuing MS in Mathematics(Industrial) in Germany. Hopefully I’m also moving to USA by next year to pursue some courses like MS in financial eng or Mathematical fin (coz currently m working in the same field.)

    Dear Young man from your conversation it’s nt clear whether u r passionate abt making money (get-rich-quickly type) or u’r really passionate and ready to give it everything type for some path-breaking innovation in technology or better in finance or if I narrow down the option it’ll straightaway hit financial mathematics domain.

    1.If you wanna make money then it’s nice path but aftr a while u’ll feel it like a mundane job with coding everyday or drawing comparison graphs etc etc and reporting type.But it pays you good.

    2.For real breakthrough and to be a quant u cant afford to skip all those pure mathematics which sit at the heart and soul of every applied mathematical area.Like you need to know things like Topology,algebrain geometry(partially),heavy functional analysis,stochastic calculus ,numerics ,variational formulation ,Ergodic theory etc etc(All of these require a strong 4 years bachelor in mathematics program type…) …Hence if you really wanna come to these area give up everything else and start building a sound background in mathematics from now onwards…Then pursue PhD in any applied mathematics with computing flavour and then jump to finance..

    Else if you wanna make money fast then do MBA and later on with some executive program you can come to this sector to be a trader but not a quant…

  13. i am an IIT grad, and doing a Finance PhD abroad (end of year 5), drop me a mail at for questions.

  14. A Phd is a very big commitment. Cons when it comes to Phd.

    1. Your degree is dependent on one person - your advisor. If your equation sours with that person, your entire degree may be in jeopardy.

    2. The pay that you earn as a Phd is much less, than what you will make as a techie. I would say it is comfortable, but you cannot afford luxuries (especially if you get married and your wife is a dependent), such as a trip to Vegas.

    3. If you live in a teeny - tiny university town, you will see people coming for MBA/MS depart after 2 years, and therefore you may be left with no constant friends.

    4. Phd involves research. And research has no guarantees. If you do not get good results soon, you may not finish in time. I know people who have completed their Phds in 7 years.

    My husband is doing Phd, hence the 2 cents of advice.

  15. The non-chalant way in which u've spoken abt not to worry abt house loans and not worrying abt living in a house of ur own.... is simply put quite amazing!

    It takes a lot of convinction in ur abilities to understand that ur good enough to purchase a house later in life!

    Love this attitude, normally which is not easy to find or establish! I'm sure any young person going thru this post would get hope and would believe in their ability, take afew risks realizing that unless that is done.. their potential would not come out!

    Thank for the post ma'am, reaffirms my faith in ur thought process and justifies my following your blog! Kudos.. :)

  16. Nice conversation. I would suggest this guy to go for a PhD if he is willing to devote some years of his life, without worrying about money, towards the research and thesis. He should not be thinking in terms of opportunity cost at this stage.
    There would be no bigger opportunity cost than not pursuing an education that one loves.
    Money will follow...passion should be there.

    Happened to read this post on the right day as today morning I was contemplating about starting a blog on making education-and-career related choices.


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