MONEY salary negotiation

The Ultimate Millennial’s Guide to Negotiating Salary

Art of Negotiating
Walker and Walker—Getty Images

Even if you don't have much experience behind you, you should be able to talk your way into more money.

This is the fourth in a series of six posts on salary negotiation published in partnership with PayScale.com.

Salary negotiation is always challenging, but it’s especially intimidating for young grads who are just starting their careers. Any how-to on salary negotiation will advise you to use your skills and experience as leverage. So, how do you make a strong case for yourself when you don’t have a lot of ammunition?

First of all, do negotiate. Some studies have shown that negotiating a few thousand dollars more can add up to one million more in total earnings over the course of your career.

Here’s my advice for young job-seekers on keeping their negotiation tactics professional, friendly, data-driven, and timely when they receive their first offer:

Be enthusiastic. Even if the offer is lower than you expected, an offer is an offer. Always be gracious and express excitement before you begin to discuss details.

Don’t feel the need to accept (or negotiate) right away…unless it’s the most perfect offer ever. Even if pushed to accept, ask to review the offer in writing if you’d like more time. It’s important to be able to weigh your options and do some research on how the offer stacks up. That being said, don’t take too much time. They have a job they need to fill.

Do use the offer call (or email) to ask about benefits in addition to salary. When you’re doing your research after the call, make sure you know a typical salary benefits range. A full-time, but hourly gig might not come with benefits, whereas some of the best companies provide benefits that end up being worth 50% of your salary. Consider your entire package.

Look at vacation time, moving allowance, and signing bonus. It’s not typical for entry-level employees to be offered all of these, but it’s important to know if any are not included, as you may be able to negotiate these into your offer. Plus, moving bonuses are definitely worth bringing up if you’re moving to a new city.

Be prompt. Once you’ve researched, respond quickly. Email is your friend. It allows you to collect your thoughts, craft ideal responses and put your best foot forward during the negotiation.

Lead with enthusiasm. You’re still interested in the job and want to make it work. Then, bring up what you want to discuss.

Be prepared to explain what you want, why you want it, and if possible, how it will benefit the company. Example: “I’d like to start on X instead of the Y as I would benefit from some extra moving time and then be able to start with all of my energy focused on learning the job.”

Don’t assume that saying their salary offer is lower than the average will work. Complement your research with an explanation of what you want and why. Take the Job Offer survey on PayScale for detailed insight into how this offer compares to similar ones. This will allow you to justify your rationale for a higher salary. It is important to be data-driven when negotiating.

Be thoughtful about what you ask. I’ve seen someone who was offered a $50,000 salary ask for $60,000. That’s a 20% increase. When you consider that a typical yearly increase is between 2% and 3%, and promotions are typically are usually between 8 and 12%, that person essentially asked for the equivalent of two promotions. (Remember, be data driven!) Be ambitious, but realistic about what you ask for, and always back up your request with data about the company, the job title and the role’s responsibilities—not second-hand knowledge you’ve heard from friends or family.

Accept or Decline. At some point, you’re going to either have to accept or decline. Show either positive enthusiasm or that you’re grateful for the offer. If it’s not going to work for you, it’s not going to work for you. Bow out with grace. You don’t want to close off an opportunity for them to come back with another offer.

Kristen Hamilton is CEO of Koru, a Seattle-based company that provides career training and coaching to recent college grads.

More from this series on Money.com:

More on salary negotiation from PayScale.com:

TIME advice

An Important Piece of Life Advice for Those 30 and Younger

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Here’s a clear opportunity to avoid a future regret

Answer by Karl Pillemer on Quora.

I spend a lot of time interviewing older people about their lives (I’m a gerontologist by profession), and in one project we asked them the question: “What can young people do to avoid having regrets when they come to the end of life?” We found that one big thing people their age often regret is not traveling enough when they were young. Indeed, one of the most important messages they have for younger people is to travel — and to do it now.

A woman in her late 80s told me that among the most regretful elders she knows are those who put off travel until it was too late — a mistake she almost made, had it not been for her husband. She said:

Because they all wait until they retire. But my husband was the one that said, “I’m not waiting until I can retire, who knows what things will be like then.” And it’s true. How do you know if you are going to be able to travel later? I look at my father, who died young, and never was able to travel much. So if you can, without hurting your financial or social or family life, try to do as much traveling as possible while you are young.

So here’s a clear opportunity to avoid a future regret: Travel in your first 30 years, while you have the time, the openness to experience, and the energy. This message comes from some of the elders who delayed travel until it was too late. One 86-year-old I talked to expressed no complaints or regrets. But she had spent her life close to home, and it was with a very wistful look in her eyes that she told me simply: “I always wanted to go to Hawaii, but I never made it. Oh, it’s too late for me.”

I can hear some people saying: That’s all well and good, but how can we afford it? The elders counter that argument by saying that travel is so rewarding, it should take precedence over other things younger people spend money on. The key is travel’s value specifically for the young; it broadens their horizons, helps them to find a focus for their lives, and challenges them in new ways.

Of course, travel is by no means only for the young — although the elders do realistically note that the older you get, the more difficult it is to withstand the rigors of travel. Seeing the world and exposing oneself to different cultures is also important in the middle 30 years and the last 30 years. Travel is just that important to feeling like your life has been well-lived.

This question originally appeared on Quora: What are some of the things you should avoid or try doing in your first 30 years of life?

TIME Ideas hosts the world's leading voices, providing commentary and expertise on the most compelling events in news, society, and culture. We welcome outside contributions. To submit a piece, email ideas@time.com.

MONEY Shopping

Why Teens Hate Shopping at ‘Teen’ Clothing Stores

Paper covers the windows at a closed Wet Seal store on January 7, 2015 in San Francisco, California. Wet Seal, a teen clothing retailer, announced that it has closed 338 of its retail stores and will lay off nearly 3,700 employees.
Justin Sullivan—Getty Images Paper covers the windows at a closed Wet Seal store on January 7, 2015, in San Francisco.

Teen retailers are suffering for not paying enough attention to the shifting taste of their target audience.

Expect to see more blank storefronts at your local mall—that is if you even go to the mall anymore. Teen clothier Wet Seal announced this week that it will close 338 stores after years of slow sales.

The once popular teen clothing store Delia’s filed for bankruptcy in December with plans to shut down entirely, and yet another apparel specialist targeting teens, Deb Stores, slid back into bankruptcy that same month. The struggles of youth-oriented retailers don’t stop there. Aeropostale lost $141.8 million in its most recent fiscal year and shut 120 stores last year. Rival Abercrombie & Fitch fared little better, while American Apparel has posted net losses of more than $300 million since 2010.

At the same time, sales are booming at shops like H&M, Zara, and Forever 21. The latter plans to double its number of stores in the next three years.

So what happened? Why are teens no longer shopping at the stores that were once the hallmark of “cool”?

1. Individuality Trumps Logos

Thanks to social media—in particular the popularity of searching “outfit of the day” or “OOTD” posts on Instagram—teens now can view hundreds of different products and looks to help them figure out what they want to buy and how to style it. They don’t need a store or brand to help dictate their look for them and aren’t relying on a single brand’s cachet. Instead, millennials favor individuality and shop accordingly. They’re less attached to brands and more willing to mix and match to create their own style, surveys by Nielsen, the Boston Consulting Group, and others have found.

Even Abercrombie, whose name and moose logo were signature design embellishments for every shirt, has realized this. A spokesperson acknowledged to Reuters: “They no longer want to be a walking billboard of a brand. Individualism is important to them, having their own sense of style.” To that end, Abercrombie has shrunk its well-known logo and increased the assortment of offerings in an attempt to better appeal to teens who don’t want to look like store mannequins (or each other).

Abercrombie isn’t the only company that has taken note and been busy “de-branding” designs, notes the Intelligence Group, which found in a study on millennials that they also favor more durable purchases, not flash trends, like classic dark plain denim jeans that can be worn for several years. Retailers that have been more successful with teens of late such as H&M and Forever 21 tend to focus more on selling clothes that seem brandless and still trendy, without prominent logos.

2. “Faster” Fashion Dominates

Stores like Zara, H&M, and Forever 21, which have much shorter waits between when clothing is ordered and when it goes on sale than traditional teen retailers, can roll out new clothing options each week, not each season, meaning they can quickly adopt trends from the catwalk and rapidly bring them to a sales floor. They can also better capitalize on cuts and patterns that are trending well with teens, giving them exactly what they want, faster than ever.

These “fast fashion” shops typically sell clothes at low prices—ideal when your clientele doesn’t have much money—and an ever-changing roster of products lures teens back into stores (or websites) again and again to see what’s new. It’s easy to see how this trend snowballs and hurts the competition, with teens having less time or inclination to look at other shops selling the same 14 sweaters they were a month ago.

3. Malls Are No Longer a Hangout

Remember Clueless, that movie that Iggy Azalea replicates in the “Fancy” music video? In it, privileged 1995 teen Cher’s default retreat is the mall. It’s where she goes to find comfort and break in her new clogs, and where a major popularity restructuring happens. Such a plot point wouldn’t be happening today, and I don’t just mean about the clogs.

Twenty years later, Cher’s counterpart’s default hangout could be at a fast-casual restaurant or at home in front of a screen of some sort. Basically, anywhere but the mall, which has seen a drop in foot traffic across all age groups, but among young people in particular. Strict “parental supervision” policies, like the one Ford City Mall announced this week, make it impossible for some teens to hang out at the mall even if they wanted to, with requirements that anyone under 18 be accompanied by a parent on Friday or Saturday evenings. Roughly 80 other malls have implemented similar policies, according to the International Council of Shopping Centers.

Add in the fact that in 1990, about 3 million retail jobs were held by 16-to-19-year-olds, vs. about 1 million today. When someone works at the mall, they’re more likely to shop there simply as a matter of convenience. Plus, isn’t part of the fun of going to a mall getting to annoy your working friend by unfolding all the shirts or pretending to be interested in smoothies so you can spy on your Jamba Juice crush?

Oh, and young people today are less likely to have driver’s licenses or own cars than prior generations, so it’s just plain more difficult for them to get to the mall. Assuming they wanted to go there, of course.

4. Budget Cuts

Clothing simply isn’t the top spending priority for teens it once was. In 2003, teens spent nearly 30% of their budgets on clothing. Nowadays, that figure has dropped to 21%. Of course, teens in 2003 didn’t have the newest iPhone 6 and its accompanying data plan to pay for or selfie sticks to buy. The best a 2003 teen could hope for was a pink Motorola Razr, if they got a cellphone at all. But the point is that today’s teens and millennials are likely to spend less on clothing and more on electronics and eating out at restaurants like Chipotle.

5. Yoga Pants, Yoga Pants, Yoga Pants

Skinny jeans? Flare? Colored? Forget them all. No teenage girl wants to buy new denim each season when she can slip on the modern uniform involving some variation of yoga pants, leggings, or upscale sweatpants. Sales of these “athleisure” offerings, embodied best by retailer Lululemon, have soared this past year as millennials swap their jeans for bottoms that can do double duty at the gym and school. Sales for activewear topped $35 billion last year and now make up 17% of the total clothing market, according to market-research company NPD Group.

With leggings offering greater wardrobe versatility at a lower cost than a typical pair of denim, teens just aren’t feeling the urge to buy those artfully ripped jeans in 10 different washes that still dominate the offerings from American Eagle Outfitters and Abercrombie & Fitch. And though AEO and Aeropostale have tried to break into the leisurewear market with new offerings, they’re having a hard battle for attention with established players likes Lululemon and Athleta.

MONEY Millennials

How to Set Financial Priorities When You’re Young and Squeezed

man counting coins
MichaelDeLeon—Getty Images

You have a lot of demands on your money—and not a lot of it. Here's what to do first.

The most financially challenging state of life is not retirement, it is early career.

That’s the time when your salary is still probably low, but you have the longest list of expenses: career clothes, cell phone bills, your first home furnishings, cars, weddings, rent—need I go on? You probably don’t have enough money to pay for all of that at once, unless your parents have set you up very well or you are a junior investment banker.

The rest of us have to make choices with our limited “discretionary” income. Here is a rough priorities list for newbies who have shopping lists that are bigger than their bank accounts.

First, feed the 401(k) to the match, not the max. If your employer matches your contributions, make sure that your paycheck withdrawals are high enough to capture the entire company match. That is free money. If you have enough money to contribute more to your 401(k), that is a good thing to do, but only if you’re able to cover other key expenses.

Invest in items that will improve your lifetime earning power. A good interview suit. An advanced degree. The right electronic devices and services for the serious job hunt.

Pay off credit card balances. Chasing those “balance due” notices every month will kill just about any other financial goal you have. If you’re carrying significant credit card balances, abandon all other extra savings and spending until you’ve paid them off, in chunks as large as possible.

Put money into a Roth individual retirement account. The younger you are and the lower your tax bracket, the better this works out for you. Money goes in on an after-tax basis and comes out tax-free in retirement. You can withdraw your own contributions tax-free whenever you want. Once the account has been in existence for five years, you can pull an additional $10,000 out, tax-free, to buy a home. It’s nice to have a Roth, and the younger you start it the better.

Save for a home down payment. Homeownership is still a smart way to build equity over a lifetime. New guidelines will once again make mortgages available to people who make downpayments as low as 3%. Even though interest rates are still at unrewarding lows, it’s good to amass these earmarked funds in a savings or money market account.

Pay down high-interest student loans. If you had private loans with interest rates over 8%, find out whether you can refinance them at a lower rate. If not, consider paying extra principal to burn that costly debt more quickly. Don’t race to pay off lower-interest student loans; the interest on them may be tax deductible, and there are better places to put extra cash.

Buy experiences, not things. Still have some money left? Fly across the country to attend your college roommate’s wedding. Take road trips with friends. Spend money to join a sports team, theater group, or fantasy football league. Focus your finances on making memories, not acquiring things—academic research holds that you get more happiness for the dollar by doing that, and you’ll probably be moving soon anyway.

Buy a couch. For now, make this the bottom of your list. Sure, everyone needs a place to sit, but there’s nothing wrong with living like a student just a little bit longer. If you defer expensive things for a few years while you put money towards all the higher priorities on this list, you’ll be sitting pretty in the future.

UPDATE: This story has been updated to clarify that Roth IRA holders can withdraw their own contributions at any time and do not have to wait until the account is five years old.

TIME

How to Get a Job Much, Much Faster

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Getty Images

This is a no-brainer way to boost your job search

A lot of Americans, especially young adults, still have trouble landing work in today’s economy. New research suggests one way to overcoming unemployment is something anybody can do: volunteer.

A forthcoming paper in the Journal of Career Assessment says unemployed young adults who volunteer find new jobs faster. Lead author Varda Konstam, professor emerita in the counseling and school psychology department at the University of Massachusetts Boston says the findings “do suggest significant association between volunteering and finding employment.”

In a survey of more than 200 unemployed young adults, Konstam finds that the ones who volunteer seem to have an edge on their counterparts. “Those who elected to volunteer, even for a minimal investment in time… were more likely to procure employment 6 months later,” she writes. This finding holds true across participants’ careers, skill sets and other demographic differences.

And you won’t even have to take that much time away from your job search to reap the benefits. Just a couple hours of volunteering a week is enough to make a difference, Konstam finds. Among study participants who didn’t volunteer, almost three-quarters were still looking for work six months later. But among those who volunteered — even those who did for just two hours a week or less — nearly half had landed jobs. While Konstam points out that her results don’t necessarily imply causation, that’s a big difference between the two groups.

There could be a few reasons behind this connection. Konstam points to the much-discussed “degree inflation” in higher education; today, just cranking out four years after high school doesn’t necessarily mean you’re equipped to compete in today’s labor market, even as more low-level jobs are demanding that applicants come with college already under their belts.

Since a degree alone doesn’t convey job worthiness anymore, Konstam’s findings suggest that employers are using volunteer work as a proxy for applicants’ ability to actually do work. Even if the volunteering is unrelated to a job applicant’s chosen field, it’s a good indication that they can show up on time, interact with other people and provide some value to the organization.

“Volunteering activities provide opportunities for emerging adults to master specific skillsets and to demonstrate proof of competency and value,” Konstam writes.

Another way volunteering might help your job search is by giving you a broader perspective on what kind of work you’re good at and enjoy doing. “It is possible that by increasing social contacts, volunteering promotes an open-minded approach toward different careers,” Konstam writes. “Volunteering may increase career-related information and skills in a variety of job-related areas in a way that broadens… career interests.”

 

 

MONEY Second Career

How to Build a Second-Act Business with Your Millennial Kid

Combining complementary skills of two generations can be a recipe for success

It’s awesome working with my dad,” says Case Bloom, 30. The feeling is mutual, says his father, David, 58: “We are good complements to one another.”

Among the more striking developments I’ve learned researching my new book, Unretirement, is the rise in boomer parents going into business with their adult children, like the Blooms—co-owners of Tucker & Bloom, a Nashville, Tenn. luggage business.

In the past few years, setting up a multigenerational enterprise has been a mutually savvy way for boomers and their kids to deal with tough economic times. The parents typically have capital and plenty of experience, while their adult children burst with energy and tech skills.

From ‘You’ to ‘We’

The Blooms, and their business manufacturing highly-crafted messenger bags targeted at the DJ market, are a prime example. Before opening shop, David had spent his career in bag design and was director of travel products for Coach in New York City before he lost that job. When Case was in college in Nashville, studying business, he’d offer pointers to help his dad’s venture. “His logo was so bad. Horrible,” laughs Case. “I’d tell him, ‘You’re doing it wrong. Do it like this.’”

Eventually, Case says, it became “We should do it this way. The business happened organically.” Today, father and son each own half of the company, which has seven employees. David handles design and product development; Case is in charge of anything to do with the brand image and online sales. He’s also the one making frequent runs to Home Depot for the business’s factory and to the Post Office for shipments. “I have a different set of skills than my father,” says Case, who is also a part-time DJ.

When Kinship Is Friendship

One reason for the growing second-act-plus-child trend: surveys repeatedly show that today’s young adults generally get along well with their parents—and vice versa. “The key is an attitudinal shift in the relations between generations,” says Steve King, founder of Emergent Research, a consulting firm focused on the small business economy. “Boomers are close to their kids and the kids are close to their parents.”

Take Amanda Bates, a Gen X’er, and her mother Kit Seay, co-owners of Tiny Pies in Austin, Texas. “We’ve always had a close relationship, feeding off one another, finishing each other’s sentences,” says Kit, 73. They’d long wanted to do something together.

Several years ago, Amanda got the idea for making handheld pies from her son’s desire to take pie to school. So she and her mother began selling small pies, based on family recipes, in local farmers markets. They now sell them throughout the state, mostly through specialty stores, and opened a retail storefront at their wholesale facility in March 2014. Kit focuses on the creative and catering side of the business; Amanda’s in charge of the basics of running an enterprise. “The trust is there,” says Kit. Amanda agrees. “Yes, the trust is there. If she says something will get done, it will.”

Teaching Your Child Trust

Trust and complementary skills are also themes for Lee Lipton, 59, and his son Max, 25, and their Benny’s On the Beach restaurant in Lake Worth, Fla.

Lee, the restaurant’s principal owner, came out of the clothing manufacturing business, moving to Florida after the Calvin Klein outerwear line he ran with a few partners was sold. He bought Benny’s a year ago. Max, who’d wanted to get into the food business, is one partner; the other is chef Jeremy Hanlon. Lee’s the deal maker, Max manages the restaurant and executive chef Hanlon handles the kitchen. “The three of us trust each other incredibly and when one person feels strongly about something we tend to do it that way,” Lee says. “Very rarely after talking do we disagree, and that format was identical to my past partners. I want to teach Max and Jeremy that closeness.”

For second-act family businesses, creating boundaries between work and home is advisable, but easier to say than do. Speaking about her current relationship with her mom, Amanda Bates says: “We used to go out together and have fun, go to garage sales, that kind of thing. Now, when we get together, the business always come up. Even at family dinners, we end up talking business.”

The Win-Win of Multigenerational Businesses

But in the end, it’s family that makes these businesses succeed.

Bianca Alicea, 26, and her mom Alana, 46, started tchotchke-maker Chubby Chico Charms. in North Providence, R.I. with $500 and less than 100 charm designs at their dining room table in 2005. They now have roughly 25 full-time employees and sell several thousand handmade charms. Alana is the designer; Bianca deals more with payroll and other aspects of the business. “It’s important to remember you are family,” says Bianca. “Things don’t always go according to plan, but at the end of the day you have to see one another as family.”

Intergenerational entrepreneurship, it turns out, can be a win-win for boomers and their kids. For the parents, it’s the answer to the question: What will I do in my Unretirement? For their adult children, working with mom and dad provides them with greater meaning than just picking up a paycheck.

Chris Farrell is senior economics contributor for American Public Media’s Marketplace and author of the new book Unretirement: How Baby Boomers Are Changing the Way We Think About Work, Community, and The Good Life. He writes twice a month about the personal finance and entrepreneurial start-up implications of Unretirement, and the lessons people learn as they search for meaning and income. Send your queries to him at cfarrell@mpr.org or @cfarrellecon on Twitter.

More from Next Avenue:

Businesses Mixing Older and Younger Partners

Hiring Your Parent

Older Entrepreneurs Are Better Than Younger Ones

MONEY Millennials

How to Make Money Off Millennials in 2015

People doing "the wave" in a stadium
Doug Pensinger—Getty Images

In 2015, the oldest wave of millennials turns (gulp) 35—a milestone with significant implications for the job market, stocks, and the economy at large.

You hear a lot about the drag that the graying of the baby boomers could have on long-term economic growth. What’s often overlooked, though, is the fact that the U.S. will be golden on another demographic front: The biggest birth year in the bigger-than-boomer millennial generation turns 25 in 2015, while the oldest wave turns 35. These are significant milestones not only for those who get a slice of birthday cake but for the economy at large.

After all, 25 is when one’s career starts to get into full swing. While the unemployment rate for 20- to 24-year-olds is 11%, it’s 6% among 25- to 34-year-olds. For those with college degrees, the rate drops to 5%. Meanwhile, the mid-thirties are “when you hit higher-earning years, are more inclined to get married, and start putting money into the stock and real estate markets,” says Alejandra Grindal, senior international economist for Ned Davis Research. Plus, “productivity growth tends to peak when workers are 30 to 35,” says Rob Arnott, chairman of investment firm Research Affiliates.

Here’s how you can profit from millennial-driven growth.

Favor U.S. stocks. The stock market has tended to take off when the number of workers 35 to 49 has surged. Boomers aging into this bracket, for example, coincided with one of the longest bull markets, from 1982 to 1999.

As a metric, investment pros look at the M/Y ratio, which is “mature” workers (ages 35 to 49) divided by young ones (20 to 34). The U.S. M/Y ratio has been declining since 2000 but will begin rebounding in 2015 and is expected to climb through 2029. “Certainly this improves opportunities here relative to Europe and Japan,” where the ratio is in decline, says Arnott.

Research from Vanguard shows you get almost as much of the diversification benefit of keeping 40% of your stock portfolio overseas by having just 20% abroad. So in 2015, shift to the low end, especially since Europe and Japan may be headed for recession (again).

rescue

Profit off their nesting. Three-quarters of Gen Y-ers surveyed last year by the Demand Institute planned to move in the next five years, many out of their parents’ homes. Capitalize on this trend by buying home-related stocks. Gain exposure via SPDR S&P Homebuilders ETF, which counts Bed Bath & Beyond, Home Depot, and Williams-Sonoma among its top holdings besides homebuilders. The ETF’s stocks trade at about 10% less than consumer stocks in general, owing to the slower-than-hoped real estate rebound.

Shoot for the middle on college. With the bulk of millennials past their undergrad years, college enrollment has been falling since 2011. Many schools are discounting tuition to lure students. If your child is applying, “don’t get your heart set on universities in cities on the coasts,” says Lynn O’Shaughnessy, author of the College Solution blog. Schools in the middle of the country, less in demand, may offer better deals. Also consider smaller mid-tier colleges, adds Robert Massa, former head of admissions at Johns Hopkins.

Illinois Institute of Technology, DePauw University, and Rockhurst University are three Midwest schools on MONEY’s Best Colleges list that recently offered first-year students average grant aid of at least 50% of published tuition, according to government data.

Read next:
5 Ways to Prosper in 2015
Here’s Why 2015 Will Be a Good Year for Stocks
Here’s What to Expect from the Job Market in 2015

 

TIME Innovation

Five Best Ideas of the Day: December 15

The Aspen Institute is an educational and policy studies organization based in Washington, D.C.

1. To head off surging antimicrobial resistance — which could claim 10 million lives a year by 2050 — we need new drugs and better rules for using the ones we have.

By Fergus Walsh at BBC Health

2. Russia has squandered its soft power.

By Joseph S. Nye in the Journal of Turkish Weekly

3. A resurfaced idea from decades ago could finally unlock nuclear power’s potential to fight climate change.

By Josh Freed in the Brookings Essay

4. To take advantage of the power of diaspora communities to spur development at home, host nations must avoid a ‘one size fits all’ approach.

By by Jacob Townsend and Zdena Middernacht at The World Bank

5. The great recession is over but young and minority Americans are worse off than before.

By Matt Connoly in Mic

The Aspen Institute is an educational and policy studies organization based in Washington, D.C.

TIME Ideas hosts the world's leading voices, providing commentary and expertise on the most compelling events in news, society, and culture. We welcome outside contributions. To submit a piece, email ideas@time.com.

TIME Careers & Workplace

Why You Should Go Ahead and Quit Your Dead-End Job

Job Hopping
Cultura RM/Jason Butcher—Getty Images/Collection Mix: Subjects RM Businesswoman resting head on desk

If you do it right, that is

Conventional job-seeking wisdom is that bouncing from one gig to the next is a sure way to get your resume thrown out as soon as it hits a hiring manager’s desk. But a new survey indicates that, as millennials increase their numbers and clout in corporate America, this attitude could become as out of place in the modern office as a typewriter.

According to a survey about on-the-job attitudes among different generations conducted by PayScale.com and research firm Millennial Branding, roughly a quarter of millennials say workers should be expected to stay in a job a year or less before moving on. While more than 40% of Baby Boomers think an employee should stick around for five years before shopping around their resume, only 13% of millennials share that view.

“It wasn’t surprising to see that millennials had a more relaxed attitude about job tenure than older generations,” says Lydia Frank, editorial director at PayScale.

Some of this intergenerational mismatch could be because of the labor market millennials confronted when they first reached adulthood. The survey finds that roughly a third of young adults with advanced degrees consider themselves underemployed — meaning they’re likelier to jump ship if they find a job opportunity that makes better use of their skills and education.

What’s especially revealing, Frank adds, is that 41% of Boomers still believe a five-year stretch is the minimum a worker should stay at a job. This means there are still quite a few hiring managers who frown on job-hopping, which means employees should be strategic with short-term tenures.

“I think they tend to view very vocal success . . . the Mark Zuckerbergs of the world — and think that’s essentially the playing field they’re on,” says Aravinda Souza, senior marketing manager at HR software firm Bullhorn.

Still, millennials might have the right idea in some industries — especially high-tech ones, Frank says. “Five years can be a really long time in certain industries like technology, for example, where staying at one company too long can be viewed as a sign of stagnation rather than loyalty,” she points out.

Young adults have less of an expectation that a company will be loyal to them, so they don’t feel an obligation to be loyal to their employer. In its survey, PayScale finds that millennials want bosses who are friendly and who give good feedback, but they’re less concerned that their boss “goes to bat for you” — a top priority for Boomers.

That said, millennials who engage in job-hopping for its own sake are taking a risk. Without a strategy behind it, this is still a red flag for hiring managers, Souza warns. “Basically, what it’s saying is you’re not loyal to the company, you’re not in it for the long haul and any resources the hiring manager would invest in you in terms of training . . . isn’t likely to be worth it,” she says.

“You have to strike a balance and ensure you’re switching companies for the right reasons,” Frank says. This means you have to be prepared to defend your job-hopping.

“Significantly higher pay, opportunities for advancement and a better match with a company’s mission or culture can all be easily explained in an interview,” she says. If you can articulate those kinds of reasons, you’ll come across as focused rather than flaky.

MONEY mortgages

Here Come Cheap Mortgages for Millennials. Should We Worry?

young couple admiring their new home
Justin Horrocks—Getty Images

The federal agencies that guarantee most mortgages are launching new loan programs that require only 3% down payments for first-time buyers. Is this the start of financial crisis redux?  

According to new research from Trulia, in metro areas teeming with millennials, such as Austin, Honolulu, New York, and San Diego, more than two-thirds of the homes for sale are out of reach for the typical millennial household.

That goes a long way to explaining why first-time homebuyers have recently accounted for about one-third of homes sales, according to the National Association of Realtors, down from a historic norm of about 40%. And it should concern you even if you’re not a millennial or related to one: A shortage of first-time buyers makes it harder for households that want to trade up to find potential buyers; and spending by homeowners for homes and housing-related services accounts for about 15% of GDP.

Now the federal government appears intent on reversing the trend — or at least on easing the pain of the still-sluggish housing industry.

Trulia’s dire analysis assumes that buyers need to make a 20% down payment — a high hurdle for anyone, let along a younger adult. But Fannie Mae and Freddie Mac, the government agencies that guarantee the vast majority of mortgages, this week launched new loan options that will require down payments of as little as 3% for first-time buyers (and, in limited instances, refinancers as well). Fannie’s program will be live next week; Freddie’s, which will be available to repeat buyers as well, will launch in early spring.

Before you get all “Isn’t that the sort of lax standard that fueled the financial crisis!?”, it’s important to realize significant differences between now and then.

The only deals that will qualify for the 3%-down programs are plain-vanilla 30-year fixed-rate loans. No adjustable-rate deals, no teaser-rate come-ons, and, lordy, no interest-only payment options. And flippers are not welcome; the home must be the borrower’s principal residence.

Both Fannie Mae’s MyCommunityMortgage and Freddie Mac’s Home Possible Mortgage program are aimed at moderate-income households. For example, to qualify for Fannie Mae’s program, household income must typically be below the area median. Income limits are relaxed a bit in some high cost areas, such as the State of California (up to 140% of the local median) and pricey counties in New York (165% of the median).

That said, lenders will be allowed to extend these loans to borrowers with credit scores as low as 620. That’s even lower than the average 661 FICO credit score for Federal Housing Administration-insured loan applications that were turned down in October, according to mortgage data firm Ellie Mae. (The average FICO credit score for FHA approved loans was 683.)

Like FHA-insured loans, the new 3% mortgages offered by Fannie and Freddie will require home buyers have private mortgage insurance (PMI). That can add significantly to mortgage costs.

For example, a $300,000 home purchased with a 3.5% fixed rate loan and a 3% down payment would have monthly principal and interest charges of about $1,300 a month. The PMI adds another $240 or so to the monthly cost; that’s nearly 20% of the base monthly mortgage amount. (You can estimate the bite of PMI using Zillow’s Mortgage Calculator.)

But one significant advantage the new Fannie/Freddie loan programs have over the FHA program is that they will allow homeowners to cancel their PMI once their home equity reaches at least 20%. Beginning in 2013, the annual insurance charge on FHA-insured loans, currently 1.35% of the loan balance, can never be cancelled regardless of whether the borrower has more than 20% equity.

 

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