The Graduate Baruchian

Investing in American Education

So I had this conversation with a friend of mine, an international student from Mumbai.  He wasn’t too keen on speaking for the vast majority of Indian students at Baruch, so I’ve changed his name here.

IndianStudent01:  Here’s the problem I see with the international students: they have no stake.

Jeremy:  What do you mean?

IndianStudent01:  Think about it, you come here, you meet a few people, you get a job.  Opening salary for an Indian hire is going to be 20k less than it would be for an American.

Jeremy:  What kind of money are we talking about?

IndianStudent01:  This is a fact, I’ve researched this, a likely starting salary for an associate at an investment bank for an Indian is going to be 60k.

Jeremy: (startled) So?

IndianStudent01:  So an American might get 15 or 20k more for the job.

Jeremy:  Well, maybe, but for an American a starting salary of 60k is about twice what the starting salary is for most new hires without work experience .  There might still be a language and culture bias though.  Still, for general MBAs, it is an average salary.  Granted, the field of finance is clearly a different story, but I don’t see what the problem is.  There’s some discrimination, but it’s still a fairly high paying wage, putting you squarely in the American middle class.

IndianStudent01:  You don’t understand.  Say I move here:  On 60k, I get on paper $5,000 a month.  In practice, maybe $3,000.  Let’s say I live in Jersey, I commute into work everyday.  Rent in Jersey is cheaper, but I still pay $800 a month.  Add bills and the commute, another $400 a month.  Food, let’s say another $400 a month.  After I send home $1,000 a month, that leaves me a bare $200 a month to survive.

Jeremy:  Whoa, wait a sec, why a thousand dollars a month?

IndianStudent01:  It’s what we do.

Jeremy:  I don’t understand.

IndianStudent01:  It’s what Indians do here.

Jeremy:  Now, I understand there’s an obligation to your family, particularly in Indian culture.  But that’s extreme!

IndianStudent01:  My family pays roughly $40,000 a year for me to be here—

Jeremy:  Right, my family paid roughly the same amount per year for my undergraduate degree.  I get that, it’s a loan.  For us, less so, educating our young is an investment in their lives that we don’t necessarily expect to see recompensed.  Plus, I know dozens of Americans whose families are shouldering a similar load in their MBA.  You know some of them too!  Me, and the rest of them, we have loans from banks, in our names.  And it  we’ll have to pay them back for the next twenty years with interest, but we do it.

IndianStudent01:  It’s not a like a loan.  It’s more than a loan.  My father gives everything he has to pay for me here.  And its expected I pay that back.  He’ll never ask for it.  He’ll never demand it.  But they do expect it.

Jeremy:  Ok.  I do understand, your culture is different than mine, family is more important.  But—I’d like to stress, that when our families pay for our degrees, it’s not a handout.  Not exactly, but the term of repayment/recompense is looser.  Take care of them when they’re old, they’re still responsible for you.

IndianStudent01: So you want me to give up my family, for five to ten years, for a job in which I can barely pay them back?

Jeremy:  But in terms of paying back your family, if you’re talking finance, you stand a good chance of getting a bonus of at least ten grand at the end of the year.  Isn’t that part of what emigrating is about?

IndianStudent01:  And that’s what I’m talking about:  Why should I emigrate?

Jeremy:  Ok, maybe not emigrate, that’s permanent.  But why not keep it open ended?  Meet someone here and settle down?  The U.S. is serious about attracting talent.  You don’t have to pay off every past generation, as much pay forward on the next few.  Plus, you’re not just making a decision for yourself, you’re making a decision for your entire family.  India or the U.S. you’re also deciding how future generations of your family will live.  And that deserves careful thought!  At anyrate, you’re my buddy, and I’d be sad to see you go!  So consider it, will you?