Obviously, it’s quite easy to get your kid a good job if you’re rich.
Step one: Open an account at a money management firm that hires low level employees like analysts or even interns. Step two: send them your son’s or daughter’s resume.
It literally is that simple.
At most asset management firms, hiring an unqualified, low-level (read: not well compensated) employee does less damage to the firm than creating bad blood with his or her parents.
A firm like Neuberger Berman, for example, would probably much prefer to pay someone $55,000/year to write “RFPs,” which are like investor questionnaires, than have his or her parents redeem (take back) the $30 million it’s managing for them next quarter, for example.
It’s simple maths. A money management firm typically charges investors 2% fees. On $30 million, for example, it’s making $600,000, well more than an underling’s annual salary.
A $2.75 million account pays $55,000 in fees per year. So to break even on the salary of a young 20-something who has some promise, a firm needs only an account that hits just over the $3 million mark.
This pisses off some people.
Like one guy, who isn’t in the money management industry, who recently griped about his friend who got a job through his parents.
“He doesn’t even know what an annual report is…” said our friend. “He also asked me what mutual funds were over Christmas.”
But when we asked someone at a money management firm if at her firm, most of the people who were hired because of connections were idiots, she said: “It happens at a lot of places. All the banks and anywhere in working world. Usually kids are somewhat qualified. Who knows. It’s the world of networking.”
In other words, it happens everywhere, so get over it. Well-connected kids will have to live with the stereotype that they are just “usually somewhat qualified,” until they excel past the people who were hired for their qualifications.
Of course, most people won’t get over it — and they will perpetuate the stigma about these kids. So the smart thing to do is genuinely get over it.
But before you go leaving the energy wasted getting angry un-wasted, let’s test that theory with a poll.
Is it unfair that kids with rich parents get great jobs? Or not, because for the child, the job is a trade off? Remember that everyone at the firm knows they got the job because of their parents, and take the poll below.