Most likely when you began your career you looked at the amount of income you would earn. You may have decided to become a doctor, lawyer, or even software developer because you thought it would yield more money.

And, if you’re thinking in terms of salary, you might be right. But, a person’s overall wealth is more than just their salary. It involves their debt, spending habits, and how they invest. The Wealth Meta Income and Spending Simulator allows us to dig into these numbers and create a comparison between the two professions.

Some Assumptions

This simulation is based on a few assumptions. First, we’re using a timeline of 47 years because it’s the average amount of time that someone is eligible to work – from age 18 to age 65. Of course, not every profession begins working at 18.

Everyone begins their career at different times - some people choose to join the military, travel for a few years, go to a trade school, attend a 4 year university, or even earn an advanced degree. For the sake of this analysis, however, we are comparing two people who pursued their careers directly out of high school.

Additionally, we are going to assume that the plumber and software developer have identical living expenses. This will allow us to focus solely on the differences in their income and debt. We are assuming that both the plumber and the software developer have a monthly budget of $1500 and that over time these numbers change with inflation.

So, You’d Like to Be a Plumber?

There are two ways to become a plumber: By doing an apprenticeship with an experienced plumber or by attending a trade school. I’m going to assume our plumber chooses to do an apprenticeship for this simulation.

You can start working as an apprentice plumber immediately after high school (or even during high school). It’s on-the-job learning, and yes, you’ll be getting paid. The plumber incurs zero debt from student loans. 

Nationwide, the median pay for an apprentice plumber is $28,157 annually. Licensing standards for plumbers vary by state, but in most cases an aspiring plumber can get licensed and become a journeyman plumber after 3-4 years as an apprentice. That comes with a pay increase to around $51,672 annually. After about 10 years of experience as a plumber, he or she will be a master plumber and earn, on average $59,926 annually.

This leaves you with a net worth of $4.02 million at retirement age.

View the Plumber's simulation here.
 

So, You’d Like to Be a Software Developer?

A four year degree in computer science (or related) is typically how a software developer begins their career. Strictly speaking, a four year degree is not required to get into the field of software development. There are other alternatives like coding bootcamps and being self taught. For this simulation, we'll go with the average debt load of $37,172 for a four year degree.

The average salary for a software developer in the first three years out of school is about $65,000. After 10 years of experience, the average salary increases to about $100,000 but it can go considerably higher for people with experience working for major technology companies that offer stock bonuses. Areas with a high cost of living also offer higher salaries.

If this person works for 43 years after beginning work at age 22 or 23, their net worth at retirement will be $7.1 million.

View the Software Developer's simulation here.

Conclusion:

A software developer will eventually earn a lot more than a plumber. However, it will be several years before the salary of a software developer exceeds that of a plumber. Although the difference in average pay between a software developer and a plumber is about $41,000 per year, the difference between a software developer’s net worth and a plumber’s net worth at retirement is about $3.1 million. The later years of a software developer’s career contributes to the extra $3.1 million in total net worth.

However, we must look at these numbers objectively. Oftentimes the more school a person takes on, the more debt they have, so the aforementioned numbers may not be accurate. Additionally, studies show that when a person earns more, they take on a bigger lifestyle, which means that they spend more of the money that they earn. It is also always possible that each career path takes on its own risks. For example, a software developer may not graduate and be stuck with their debt, or the plumber could get injured on the job and become unable to work in their field.

All in all, a software developer will likely have a higher net worth at retirement than a plumber permitting that both live a frugal lifestyle and that the software developer takes on an average amount of debt at the beginning of their career.

• The plumber hits $1M in net worth around year 27 of the simulation, or age 45.
• The software developer hits $1M in net worth around year 22, or age 40.
• The plumber hits $2M in net worth around year 37 or age 55.
• The software developer hits $2M in net worth around year 29 or age 47.
• The software developer has a maximum debt of ~$61k (year 4 of simulation) while the plumber’s is zero!
• The software developer’s net worth catches up to the plumber’s after year 11 in the simulation (when they are 29). So for the first 11 years the plumber is ahead on paper, but from there the software developer’s net worth out paces in the plumber’s.

Try building your own simulation (view then save as...) to explore your own assumptions:

• View the Software Developer's simulation here.
• View the Plumber's simulation here.