The value of a college education
The Financial Value of a College Degree
Does earning a college degree make a difference to your future? Absolutely. The facts are striking. On average, those who have a college degree earn almost twice as much as those who do not. According to the U.S. Census Bureau:
Adults with advanced degrees earn four times more than those with less than a high school diploma. Workers 18 and older with a master’s, professional or doctoral degree earned an average of $82,320 in 2006, while those with less than a high school diploma earned $20,873.
Workers with a bachelor’s degree earned an average of $56,788 in 2006; those with a high school diploma earned $31,071. This flurry of numbers makes more sense when viewed in a table:
| Education | Avg. Income | Increase |
| Drop-out | $20,873 | — |
| High school | $31,071 | 48.9% |
| College | $56,788 | 82.8% |
| Advanced | $82,320 | 45.0% |
Completing college is huge. Over a life-time, a college degree is generally worth almost a million dollars. That’s money that can be used for saving, for fun, for whatever. The financial benefits of a college education are significant, and they’re very real.
Other Benefits of a College Degree
Obtaining a college degree isn’t just about making more money. According to Katharine Hansen at Quintessential Careers, a college education is associated with other benefits, such as:
- Longer life-spans
- Greater economic stability and security
- More prestigious employment and greater job satisfaction
- Less dependency on government assistance
- Greater participation in leisure and artistic activities
- Greater community service and leadership
- More self-confidence
A college education also gives you a broad base of knowledge on which to build. It teaches you to solve more of life’s problems. It gives you future reference points for discussing art, entertainment, politics, and history.
College offers other learning opportunities, too. Much of what I gained in college came from learning outside the classroom, from participating in clubs and other campus organizations. Many degree programs allow students to “test-drive” careers through internships and practicums.
The Label on Your Degree Does NOT Matter
I asked Michael Hampton, director of career development at Western Oregon University, what advice he would offer a student who is deciding whether or not to attend college. He replied:
Unless you are going to be an engineer, architect, teacher, lawyer, the label on your degree does not matter. The degree is a check-mark (as opposed to the focus) in most job requirements. Many job ads will state: “Business, Communications or other degree required.” Most folks have the “other”.
I have a BA in Speech, Telecommunications & Film. As a television news photographer, youth director, communications director, substitute school teacher,
sports marketing manager, career programs coordinator, no one ever said to me: “You know what? We would like to hire you, but we’re not sure what that label is on your degree.” 
Honestly, at the University of Oregon, I was looking for an “easy” degree because I was not a book-smart student. I was able to take mostly film & television classes to earn my BA, so I signed up. The experiences I took advantage of (internships, volunteering, and part-time jobs) in college set me up to be marketable to employers. Again, the jobs I went after required degrees, but the label on the degree was not a barrier.
Here are some more prominent examples:
- What was Alan Greenspan‘s major? Econ, but he studied music first
- What was Michael Jordan‘s major? Math, then Geography (dropped out to play professional basketball, later returned to earn his degree)
- What was Lisa Kudrow‘s major? Biology
- What was Cindy Crawford‘s major? Chemical Engineering (dropped out for modeling career)
- What was Ted Turner‘s major? Classics (expelled for hanky-panky)
- What was former HP CEO Carly Fiorina‘s major? Philosophy
- What was George W. Bush‘s major? History
- What was Jay Leno‘s major? Philosophy
If a student is struggling to get good grades, I encourage them to look at the course catalog and choose a major based on the likability of most of the classes they would have to take, their positive experiences with the professors in the major, and the number of credits they have already taken that are compatible. They should set themselves up to be successful. Getting through the pre-reqs is a major barrier for some. Combine some “fun” classes with the challenging required courses to try and make the experience more enjoyable.
Against the Grain
But what if, instead of paying for your child’s education, you provided this lump sum to them in a one-year certificate of deposit, earning the current highest return available (2.24% as of the writing of this article, according to Bankrate.com)? Now the child’s salary would be greatly reduced; the lifetime earning potential would only be $4.2 million assuming the same circumstances as before.
However, assuming that in both scenarios the child in question was able to save 5% of their annual income (assumed to be a lump-sum deposit at the beginning of the year to keep calculations simple), the child with the high school education will have accumulated $646,532 in the one-year CDs by the time they’ve reached retirement age. The child with the college degree would only accumulate $438.132, a difference of $208,400.
Perhaps it could be argued that the child with the college degree could live with the same expense basis as the one with the high school education, thereby freeing up more money for saving and investing. However, I would encourage a recognition of Parkinson’s Second Law, which tells us that “expenses rise to meet income”.
Rich or poor, thrifty or not, the current savings rate as of the end of May for Americans was only 6.9%. For much of the recent past it’s been lower than that, even to the point of occasionally becoming negative. For as many responsible people who are reading these words, there are many more who would be swept along by circumstances and society, spending exactly what they make (or more), year after year.
Public vs. Private
What if one were to assume a lower university bill? Perhaps a private school isn’t in the cards for these two kids (and their parents), but a public four-year institution could be.
The current median cost of four years at a public university for the 2009-2010 school year is only $29,021. At that rate, assuming the same parameters as before (rate of salary increase and inflation, etc.), the college grad does come out ahead, but only by $26,090 at age 65. Certainly, that’s a much smaller margin than I would have assumed, and I would guess it surprises many of you, as well.
In fact, for the lifetime earnings calculation to balance (that is, for both the high school and college grad to show the same dollar figure in savings at retirement age), the high school graduate would only need a “head start” fund of $38,030! Just think, for less than the price of a new SUV, four years of college-educated earning power can be rendered moot. This result, frankly, surprised the heck out of me.
Other scenarios could be run, as well. What if you’re not able to provide any funds at all for your son or daughter? My folks didn’t pay for any of my college expenses; I expect many of you are/were in that same boat. One could look at the opportunity cost of college loan repayment vs. a clean slate for a high school grad with no debt encumbrance.
For a graduate of an average private university, repaying a college loan bill of $114,626 at 6% interest (remember, student loan interest is capitalized while the student is in school) will take 10 years and $152,710. That’s assuming they’re able to make the monthly loan payments of $1,273 right out of college, and don’t have to go with a longer-term repayment plan. After this is done, the college grad will only amass $37,272 more in savings than the high school grad, simply due to the long repayment period they must overcome.
Be Cool — Stay in School
While a college education statistically provides a better shot at obtaining wealth, it does not guarantee success. There are English majors who end up with convenience store careers. There are high school drop-outs who go on to run multi-million dollar corporations. But obtaining a college education improves your odds.
For some young adults, college can seem like a waste of time. (Or worse, a waste of money.) Other things seem more important. I had friends who dropped out of school to pursue girlfriends across the country. I had friends who were convinced they could make more money by skipping college altogether. Student loans can be so enormous that they make a person lose sight of the fact that they’re an almost guaranteed investment in the future.
I personally had problems finding a career path — I simply had no idea what I wanted to do. When I went entered college, I wanted to be a religion major. Then I wanted to be a writer. Then I wanted to be a grade school teacher. Ultimately I earned a psychology degree, which has had little direct benefit to my life. But the education I obtained, my campus experience, and the contacts I made have been invaluable. A large part of who I am today was forged by my experiences in college. The value of a college isn’t just in the destination, but in the journey.
Resources
In preparing this article, I relied heavily on the following sources:
- U.S. Census Bureau: Educational attainment in the United States
- Free Money Finance: More education equals more pay and How I made millions off a $5,000 investment
- Quintessential Careers: What good is a college education anyway?
- Financial Calculators: What is the value of a college education?
How many of you attended college? Are you glad you did? If you didn’t get a degree, do you regret it? If you could talk to your 18-year-old self, what would you tell her? If I had a chance, I’d tell the young J.D.: “Set goals. Study more. Find a direction for life!”
Update: As usual, there are some great comments. Many have noted that education does not cause all these wonderful things — it’s simply correlated with them. (It may be that people who obtain an education would live longer even without one.) Also — and this is key — more important than education is doing what you love. Passion and drive can bring success, no matter what level of schooling you have.
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There are 291 comments to "The value of a college education".
This is a rare post that I conceived, wrote, edited, and published all on the same day. As a result, I actually know how long it took to create.
From start to finish, this article took four hours to write. The first hour was spent on a braindump: just pouring out the various ideas I had. (I also e-mailed a couple of friends, including Michael Hampton, asking for tips.)
The second hour was spent fleshing out details. The third hour was spent organizing the information, and incorporating some of what Michael sent me. The fourth hour was completely spent editing.
And this was a rush job. I wanted it done by eleven. Under normal circumstances, I’d spend another hour or two honing the piece.
Trivia time over.
I received a Bachelor’s in Interactive Media Design, and hold an A.A in History and my peers make more money than I do without the college education.
Certain fields just don’t get paid as much as the statistics for a college degree, i wouldn’t recommend it.
Maybe it differs city to city, but here in Seattle my Degree has garnered me poor wages across the board due to over saturation in the field
Interesting stuff. I found your blog about 2 weeks ago and bookmarked several posts to share with my husband on our annual “Financial Summit” getaway. (We “splurge” on an inexpensive hotel for a weekend to focus on our budget & financial goals.)
Anyway, my husband and I both have college degrees. He in Social Work, and I in Music Education. Both of us worked in career fields related to our degrees and earned appropriate salaries for the fields we were in. Now, however, neither of us is working in the field in which we received our degrees. We both benefitted from our college experiences, though. For me it was a growing up time. It helped me gain confidence and get over my shyness.
I would tell my 18-year-old self to take classes that interested me, without regard to degree plan. I would take more art, design, and religion classes.
My degree is not helping me to make more money, but it did contribute greatly to who I am today.
Personally, I have a BS in Engineering Management and an MBA in Business Administration. I’m definitely glad I got the latter. My salary has doubled since I started the graduate degree. Sure, it would have gone up anyway, but it has really helped get my foot in the door and look more professional.
I totally agree that what matters is giving yourslef the chance to have the odds in your favor. Everyone has a story of someone they know who made it big without college and someone who flopped afterwards. There will always be extremes and you can’t count on being one of them.
As for talking to my 18 year old self, I would say, “Forget what you’re thinking, go ahead and get the Architecture degree you want!”
This was the perfect timing for me to read this article. As much as I love my major and attending school, there are times I’m just so exhausted.
Thanks for putting things back in perspective!
Ummmm…Cindy Crawford and Michael Jordan dropped out. Ted Turner was expelled. And the link you provided for Robin Williams doesn’t say anything about him being a philosophy major or having gone to college (unless Julliard counts).
“Unless you are going to be an engineer, architect, teacher, lawyer, the label on your degree does not matter. The degree is a check-mark (as opposed to the focus) in most job requirements. Many job ads will state: “Business, Communications or other degree required.” Most folks have the “other”. ”
This is so true. I actually went to college to become an architect, but I’m doing the furthest thing from architecture as a career. Every job I received after college may have preferred a degree in a specific field, but generally they just wanted you to have some sort of college degree.
Like Michael Hampton said, unless you are in a specialized field that requires special certification or licensing requirements, more often than not employers are simply looking for a college graduate.
Of course, having a degree in the field you’re trying to get into will certainly improve your odds of getting a job, it isn’t a requirement, especially for entry-level stuff.
Good post JD. I’ve got a BS in Math and have NEVER used any of my coursework in a professional capacity. I know for certain that just having a degree has opened doors for me.
I have a degree and earn minimum wage. Can I give away my degree and take the earnings instead for a high school graduate?
Actually, if you’re going to be a lawyer, your undergraduate major doesn’t matter one bit. Once I had a law degree from a top school, prospective employers didn’t care if my college degree was a B.A. in basketweaving from Party University. I think there are two lessons here: first, if you know you’re going to get a law degree, don’t go into debt for your bachelor’s–save that for law school. Second, study what you enjoy in college so you have something to fall back on when you get burned out practicing law.
If I could go back I would tell my 18-year old self (actually 17 since I started college a year earlier) to just hurry up and finish the degree, any degree! I was set to graduate with a B.S. in Biology when I was 21 but during my senior year, I lost all focus, didn’t care, flunked a couple of courses, dropped out and went to work. I intended to go back in a year and finish but instead met THE ONE at the job I had taken, got married, and so on. I finally graduated this past summer, 11 years after starting college. For the past four years I’ve worked in accounting. I make decent money and learned most of my accounting skills on the job. I also handle environmental permits for my company and have found that my background in science and the technical writing I did in school have helped me immensely in that aspect. Also, I was generally an intense student (other than that one fateful year) and I believe I learn quickly on the job as a result of that training in school. I think one of the huge advantages to finishing an undergrad degree, whether you’ve found your true calling or not, is that later on you can pursue higher wages through an advanced degree without having to start from square one like those who chose not to finish (or start)college at all.
I think that the important thing, as in so many areas of life, is not the process but starting it with a goal.
My advice to my 18-year-old self:
* Don’t believe the people who say that their degree program leads to starting salaries of $40k or $50k or whatever. Definitely don’t change majors because your original program isn’t saying that and the new one is. You’ll end up pulling $30k and miserable.
* Wait on school until you’re really ready to do it and do well at it. Don’t go at 18 just because it’s expected. Starting your career a few years late can make you really impatient, but it’s worth it in the long run when you have a career and your friends have brightly colored polo shirts.
Hmmmm.
I agree, in principle.
For any given field, a higher degree will earn more money. Some fields will pay a PhD less than other fields will pay a high school graduate (e.g. post-doc researchers vs salespeople).
And in some fields you absolutely need a degree.
I think that a degree is more than a checkbox. Obviously, quality of school is important.
Second, science vs. liberal arts is undoubtedly important. Marketing, communications, philosophy, etc are all sorta/kinda interchangeable. But try getting a economics or statistics job (not even science) with a commuications degree. Also, the Alan Greenspan example is interesting, but using movie stars is just dishonest. Hey — you can be a pro football player regardless of what your degree is in! And maybe Bush isn’t the best example, either. 🙂
Also, I’ve been considering an MBA. And I actually came across an interesting article based on interviews with hiring managers that had a few quotes:
a) “ALL THINGS THE SAME, we’ll probably give the MBA a job… maybe give them about 5K more a year.”
b) “We actually look down on people with an MBA. What kind of choices are they making if they give up a 200K/year job in order to pay 50K/year and not work for two years? (that was for investment banking)
Also, the $1m extra is bit misleading. You need to think about the opportunity cost and time value of money. Easiest way to do the comparison would be:
“If, rather than going to university for four years and paying tuition, I worked in the best job I could get and saved as much money as I could (living an equivalent lifestyle as I would in college) for those years, how much would I have at the end of my life?”
At that point, a million doesn’t sound so great.
Lastly, there’s a bit of a selection bias. Sure, having a degree helps you earn more money. But I’d say a lot of the difference that Census found is that the types of people who go to college to get a degree are the types that would do well regardless and succeed in a lot of circumstances.
James
There is a big difference between correlation and causation. The statistic shows that people with degrees get high paying jobs, but doesn’t indicate why. It could be they are smarter, more motivated, more interested in success, or have less factors holding them back.
Freakanomics has a great example of this. Children growing up in a house full of books do better in school. But adding books to a house doesn’t make a kid do better in school.
While I do agree getting a college degree increases your chances of success, I’d be curious to see if any studies were done on how much a college degree increases the salary of someone who is already in the work force with a high school degree.
I’m not sure if my reply really answers your question directly, but I’d like to put my two cents in. When I was a teen I wanted to be a veterinarian. Life happened and I had two children at an early age. Even that didn’t happen, my parents (divorced) were in no position to pay for this. When I was 20 I got a job at a major electronics corporation as the mailgirl. I eventually worked my way up in 17 years as an analyst, all using job experience and drive. After that I went in a complete direction and decided that I wanted to become a bookkeeper so I could make my own hours and eventually have my own business. I did take many night school classes and courses, but opted not to get a degree or become CPA certified. I did eventually acquire my own business and I’ve been at it for 20 years. A couple of years ago, I held a reunion of sorts with friends that I had known at the electronics corporation. Most of them had degrees. Some of them took me aside and asked if I had extra work. That blew my mind! What my point is that if a person can get into a field where there is a high demand, even if it’s a blue collar technical field, they can make just as much money as the person with a degree. For me, as a bookkeeper, I have a lot of CPA contacts. I always have plenty of work and have had to drop some clients. I can make whatever I want to make that day/week or month. I will admit that it did take a lot of drive and tenacity. I think even with a degree, if you don’t have that, you won’t get the best jobs. thanks for letting me share
GREAT article!
Forcing my teenagers to read it. Thanks.
Michael Jordan dropped out of college, but did finish his degree in 1986. Coincidentally the average salary for a geography major graduating in 1986 from Carolina was somewhere around $200k. Guess Michael skewed that a bit upwards?
The most important thing I got from my college degree was the appreciation for myself. I got out of my dinky hometown, I saw more of the world, met people from other places, learned more about myself and graduated with hope and self-esteem.
I do rail against the cost of education though. I’m just amazed at what people will pay for a degree. It’s one thing to go $200k in debt for a degree from Yale, but people go into great debt for small, less prestigious schools. Makes no sense to me to pay that for a no-name school, when you can get a fine education at a public institution.
Minimum wage made a good point, degrees do not automaticly mean more money. Along the same lines I have to question if spending tens of thousands of dollars (usally borrowed) is worth it. Almost every PF blog I read where they are tying to get out of debt school debts are a large portion of it. Most people would be better off getting a trade instead. Quite common is the low wage worker with tons of school debt.
I’m just amazed at what people will pay for a degree.
Far too many parents say to their children, ‘You have to go to college so you can get a good job.’ They don’t always say, ‘You have to go to college and go to classes and complete the problem sets and answer the professor’s questions and do the research and write the papers and sit the exams so you’ll have a better chance of being able to have the luxury to choose what you want to do with your life.’
Honestly, the biggest mistake I ever made was going to college. Twelve years after graduation I’m still paying for that mistake.
I’ve noticed that the biggest money makers in the world either didn’t go to college or dropped out, with very few exceptions. I also know many people who have gone up into graduate degrees who are very happy they did. Ultimately, I think the question is, “What’s the goal?”
For someone like me, an actor, college is a very bad idea unless you go to a school which is located in a major market.
For someone looking for a security-based income, regular paycheck, etc., college is a great idea.
It all depends on the goal.
When I sat down to write a post about my money decisions for my blog, I immediately knew that my educational choices were far and away my best. I got a BA in Computer Engineering and then took a job with an employer that paid for me to get a MS in Software Engineering. To get here is/was a lot of hard work, long nights, and Red Bull but it has paid off. This path is really only for those who enjoyed taking apart electronics when they were kids, begged for Legos and erector sets for Christmas, and would rather learn C++ than Spanish. My total bill for education was near $100k but 2.5 years out of school I’ve made back every penny.
Most of the “other benefits” listed are correlative, not causative. Getting a college degree will not make you live longer, nor will it give you more time for leisure (although once you finish your degree, you may feel like you have a lot more time). It may not even lead to a higher paying job, as Minimum Wage has noted.
Sure, on average people with a degree will earn more and live longer, but on average everyone has one testicle and one breast. I don’t think people should go to school to “get a degree.” They should go to school if a degree is a requirement for the career they want, or if they actually want to go to school.
I tried university, hated it and dropped out, then did a two-year diploma. Now I earn more than the average for people with an advanced degree. I know other people who love school and have multiple degrees (and a six-figure student loan). I think people should look at whether they really need or want a degree, because it’s a big commitment. I’ve never felt like not having a BA has held me back.
I agree 100%.
My wife and I were discussing this topic recently. The one thing I’d say though, is to try to come out of it with as little debt as possible.
We both went on 100% credit, and are paying for it now. We could have lived on less, and supplemented it to ease some of the stress we’re having now for sure.
But overall, it will always be worth it!!
ps. I have a Business Management degree, and I’ve done Graphic Design since I graduated.
for leno, crawford, michael jordan… I don’t think college did much for their careers! 🙂
Labels can matter, but they don’t have too. You could make a chart of the average pay for different majors, and there will be some clear winners. It’ll be hard to get into engineering with a music degree. But you can do a lot of stuff with having an “other” degree than having no degree.
When going to the Wikipeida article on Alan Greenspan, you find that he got a BS, MA and PHD in Economics. Although the article does state he was a very good musician.
Very interesting. I have an interdisciplinary degree in Humanities (aka General Studies). While on the surface it may appear useless – unlike a nursing degree or others mentioned in the post – I would have to agree that it was worth the time and money invested in getting it. My parents always told me you go to college to learn how to think. My degree was very much a “thinking” degree. Since college (about ten years) I’ve worked in biotech, insurance, and now design. My skills – mainly my ability to think logically and analytically – has taken me far each time I stepped into something new.
Our world is evolving so rapidly, things just aren’t as cut and dried as they used to be. It’s no longer a choice between being a nurse and a teacher or a doctor or a businessman. Stepping back and taking a broader perspective on the college degree (as this post did) is the way of the future, I think.
I remember hearing in one of my college classes that there was a very strong correlation between how successful a man was in his chosen profession and his mother’s education level. The more education the mother had, the more successful the son. This was 14 years ago and I know you can skew statistics, but still an interesting thought.
I graduated a month ago and (finally) got my B.S. in Business Management. I’m glad I attended, I just wish I started as a business major student. I would’ve been motivated enough to finish sooner. I changed degrees twice (both in first two years).
It bothers me that so many people look at the edge cases (extreme success/no degree, no success/advanced degree). These are few in number. The whole picture needs to be examined, namely, if you get a degree from an accredited institution, your chances for success are much higher than if you just graduated from high school.
Case in point: my dad and I are both software developers. Because he didn’t have a degree, it took him 20 years to reach the salary point it took me 4 years to reach. And my degree isn’t even technical!
So, in summary, get a degree, any degree, even a vocational degree, and you’ll have more options than if you have no degree.
I have 3 degrees, an AS, BS, and MBA. Certainly the “college degree required” bit is a checkmark. How many of those jobs really require anything you may have learned in college? A college degree today is the equivalent of a high school degree in the 50s. It’s the price of admission to corporate America.
I don’t dispute that college graduates earn much more. What I question is why. Are we worth more, or is it just really good marketing by the higher education industry?
Getting a degree from the right school is the key. An overpriced school that lands you $150,000 in debt from the start is a poor choice.
I am a proponent of online education with a bachelors from one school and an MBA from another. They were very demanding and I learned a great deal that I’m able to use in my corporate world job. You can read about my experience at my blog if you like.
Again, I would shy away from the mega expensive schools. The internal rate of return for those cash flows take a long time to work out to the positive, especially if you borrow the money to go.
Going to university was probably the best decision I’ve ever made. It gave me confidence, the ability to mix with other bright people with similar interests, and most importantly of all the opportunity to study the subject that I loved.
As it happens, I wouldn’t have got my job without a degree in a science/engineering type field, and it’s a job that I love. I also probably wouldn’t have moved cities, bought a house, discovered travel,…
Did I mention that it’s probably the best decision I ever made.
Thanks, folks, for the corrections. I’ve made the changes to the list of famous people, and used a strikethru to note better wording earlier in the piece. You’re all right: correlation does not imply causation. That’s an error on my part.
And remember that one of my major points is this: Education does not guarantee success, but it does improve the odds. Significantly.
I’m glad someone else pointed out the difference between cause and correlation.
As far as I’m concerned, the educational system is a travesty. It simply does not do what it claims it does.
People who can prosper without a diploma are infinitely more capable than those who depend on them for their success. Universities make people irresponsible, instill in them an abominable faith in the infallibility of self-styled experts, and perpetuate and promote political bias. Any omnipresent social institution that claims impartiality while, in effect, being dominated by a single political point of view — studies have shown that a super-majority of professors are leftists — poses a serious danger to democracy.
You don’t need to be branded by the establishment in order to succeed in life. I’d rather not be vetted by an incompetent and incapable educational system.
Centuries from now, people will look at our educational system the same way we look at astrologers today; with incredulity.
Marc, can I guess you already have a degree?
I don’t necessarily disagree with you and the relevance and quality of education can always be overhauled for improvemenht,only I can’t understand encouraging others not to take advantage of an education system that can provide the same opportunities you’ve had to earn a better living. It’s the chance to increase our opportunities in life that needs to be highlighted.
Having said that, I chose to be a stay at home mum from the age of 30 because I found that far more rewarding and interesting than pursuing a career. Even so, I’m glad I earned my degree and followed my passions when choosing what I studed. I don’t earn as much as others who invested more of their time and energy in their career (including people who don’t have a degree who I compete against in the workforce) and with society being the way it is at the moment, having re-entered the workforce late in life, having a degree has not necessarily led to better career opportunities. Still, I’m sure it’s better I have a degree rather than not having one! My earning potential may have been seriously limited if that had been the case – possibly
$10K less a year.
I found working through a degree personally rewarding and satisfying – it certainly gave me confidence in what I know,in knowing how to carry out research if I need to know more about anything at all, and how to think independently. Without any doubt, those skills and personal qualities developed through doing a degree, have increased my earning potential.
You can’t get a college degree for the money. It will almost always burn you. Take that statement with a grain of salt, I went to an all engineering school, and the people who just wanted the money (hated math) they struggled through classes, cheated a lot, and ended up with a job that would “take them” but they struggled with their job too. They might make more than average, but they are miserable, and that type of quality isn’t sustainable. I would venture a guess that anyone with a degree from my school could take their pick of jobs that don’t require an education. That’s hardly a consolation prize though.
Advanced degrees are the new college degrees. If you have a MS, you can usually take your pick at BS jobs. Another thing to look at is that an MS degree (typically two years, but some schools offer a non-thesis option that takes a year if you start getting credits your senior year of your BS) is the biggest bang/year. So if a BS is a good idea, then MS is a great idea. PHD’s don’t earn substantially more than MS, but they have to go to school for 5 more years+.
If I had a kid that was 18 right now, I would tell them to find a college/curriculum that challenges them, and keeps them interested.
If you are working at your potential, and you like what you do, the money will follow.
” If you could talk to your 18-year-old self, what would you tell her?”
How about buy Apple oh, and Google.
Interesting article. Have you thought about an article on the value of a graduate degree. Both my wife and I have PhDs in chemistry. I do pretty well, she’s somewhere between the average high school and college grad. My general recommendation, don’t get a PhD unless you want to do academics. The most bang for your buck is in a Master’s degree.
How many 18-21 year olds actually, truely, would work full time and actually live like a college student and save the “opportunity cost” into a IRA or other retirement fund? I think the budget category labeled “blow” pretty much consumed the majority of the income of those friends and acquantences I knew who weren’t going to college. That’s why blogs like this help, but not until most of us have already racked up the debt regardless of attending college or not.
I will say that my wife (HS diploma only) went to work for a company that paid two other employees the current equivalent of $5000 more in salary just because they had Associate degrees and she didn’t, even though her supervisor agreed she was more compentant at the same job (on the up side he was more than willing to pay for her schooling to get a degree and encouraged her to do so). Over the years the types of jobs she has been able to apply for have been limited since many asked for a college degree or equivalent experience, which is hard to get if you don’t have the degree.
You might also want to consider that most folks without a college degree who have become successful, often want their kids to attend college. In my opinion it’s because they feel via their experience, that you have a better chance (note, chance, not guarantee) of making more money and living a reasonably stable and secure life without encountering or taking on the risks they did to become successful. Not everyone is cut out to be a Cindy Crawford, Michael Jordon, or Bill Gates.
I have a BS & an MS in statistics. Without them (or very similar degrees) I couldn’t have been considered for my current job. A few prestigious internships didn’t hurt to set me above my peers.
That being said, I feel the greatest benefit I’ve received from my education was actually my education. Critical thinking, problem solving, learning how to work the system. And I got out of the whole thing less than $8K in the hole.
I’ve been to college twice: at “college age” to get my parents-sponsored BS in English (with some foreign languages and engineering classes thrown in) and about 10 years later to take some Math and Computer Science classes in preparation for graduate school (which I haven’t pursued, yet).
I was able to get a job out of college with relative ease (although I had to move to a coast), and my career has progressed with a few twists and turns since then. The latter set of classes helped my career a bit. I’m making a lot more money that I would likely have made with no degree. I’m not a schmoozy go-getter type of person — it helps me to look good on paper.
I would tell 17-yo me to take useful foreign languages and live abroad to learn how to use them properly. Do challenging internships and research projects in your major(s). Take a double major — one in something practical and one for love. Don’t be afraid to fail in the area you are doing for love — you’ll enjoy the learning, even if your grades aren’t the best, and you’ll use the education to pursue your interests as a hobby if not for profit. After 5 years of working, noone important will care where you went to school or what grades you got.
I don’t wholeheartedly agree with this post. While I love learning and I’m all for continued education, I don’t believe having a degree is an automatic ticket to a higher salary. I believe it depends on the career one wants to pursue.
My husband’s salary falls into that Bachelor’s Degree range you mentioned, although he never attended college. He is a construction worker, and did not need a degree for his chosen field.
As for me, I tried going to college right after high school because that’s what my teacher’s expected of me (since I took all the college-bound classes in high school). But my heart wasn’t in it and I dropped after one semester.
I returned to college for some course work when I was in my 30s. I loved the classes and made excellent grades, but I still didn’t have a career goal in mind. My life away from the classroom, i.e. work and family, were more important than pursuing a degree that didn’t mean anything to me.
I don’t see myself every pursuing a degree, although I can see myself taking a class now and then for pure enjoyment.
As for what I’d tell my 18-year-old self, I’d tell her to be true to herself and not do things just because someone else (namely teachers) expected it. I’d also tell her to look into vocational/technical training, something I might have been interested in but was never made aware of because my teachers and counselors tracked me into the college-bound classes.
I got a B.A. in writing in college but always intended to become an editor. Not a highly-paid career, true. But I love words and wanted to work with them; I didn’t care how much I would get paid. I figured going to college would help me achieve my goal. It did. I was able to get career experience by working in various Writing Centers and getting an editing internship.
Now I work for a small publishing house at a ministry. I make less than the high-school dropouts you list. But I live well enough (i.e., I have enough to eat and can put gas in my car) and I am extremely happy in my career. I think college was worth it for me.
I do wish I could’ve told my younger self to save more money by going to college earlier. I did only one year of PSEO; should’ve done two.
This is what I would tell my 18 year old self. My 18 year old self, I would say, there is almost nothing you can learn at an institution that you can not learn by yourself. If you are smart enough to get accepted at whatever prestigious university, you will be as successful as their students without spending 4-6 years learning things that are as testable as they are useless. Mostly success is about intelligence, persistence and drive. Getting a sheepskin from passing courses adds little value to that. It just shows what you already know – that you have those qualities. What an education does bring you is connections and an automatic foot in the door at the HR department. However, if you can learn to obtain these things without a degree, you will be better off than the herd who did the college thing.
Incidentally, I got a phd and I intend to be successful despite it, not because of it 🙂
Thanks for posting this JD. Over the past 2-3 days, my girlfriend and I have started the steps to go back to school. I am a 26 year-old with a BS in Management from Georgia Tech–she is 23 and never finished her degree. She is looking to get back into a Bachelor’s program to finish and I am pursuing my MBA. So this was post was quite timely for our situation!
I wish I could tell my 18 year old self: “Go to class you idiot!” It took me several extra semesters to graduate because I spent so much time early on slacking off. My GPA, and my grad school prospects, suffered because of it.
As to Annie J. above–in general a degree IS a ticket to a higher salary. While it’s true that some people do become quite successful without a college degree, many more do not. You don’t have to have a college degree to earn more money–but it (in the majority of cases) makes earning that much more money far easier.
I’m a supporter of college; it really does get your foot in the door, most cases, and emphasized it for my daughter who has a RN degree now. I think people tend to gain more maturity who go as well as an increased vocabulary. As for myself, I worked after high school in law firms, then at age 28 wondered, how would I do in college if I were to go? Would I get A’s, D’s – I was curious. So I went to a community college, part-time, for 2 years and got A’s in every class. (I had to work for them though). That 2 year time fulfilled my curiosity, and gave me some self-respect, and I really liked the knowledge I gained from all the required undergraduate classes too. But after that, I realized I preferred a self-taught approach, reading things that interested me, and I just didn’t want to sit in classrooms anymore. I retired at 48, following “millionaire next door principles”, so I did all right. My brother is one year older than myself and is a multi-millionaire! He and his wife own a computer-related business. And he never went to college period, but growing up with him, I remember him to be always brilliant, acing every high school class w/out hardly any effort whatsoever. I should ask him how he feels about not going – does he have any regrets, etc.
Adfecto, the cost for my BS in CompSci was $20K tuition+books at U + $3K tuition+books at community college. Despite getting into the relatively low-paying fields of tech support and testing I still paid off the $20K in student loans within 4 years.
This post dovetails well with my book club this month (Sayers’ Gaudy Night). As one Master of Arts points out, “If you learn how to tackle one subject – any subject – you’ve learnt how to tackle all subjects.”
I’m very glad I attended college. If I could talk to myself at 18, I’d tell her to go to a different school. My school was not a good fit for me, though I did manage to graduate.
One of the unspoken purposes of college is class laundering. Of course, we don’t have class in the U.S., but if we did, that would be part of the use of college.
” If you could talk to your 18-year-old self, what would you tell him?”
Get a degree in Finance and then work for a company that will pay for your masters. While there, work hard and smart and earn over $100K/yr.
I have BS-Biology and BA-Criminology. I am now in the computer field, where people just need certifications and not degrees. I make the same as people who never went to university.
All in all, it is what you do with what you have that makes the most difference. Degrees don’t make one person better than another, although some like to act so (see snooty license plate cover mentioning their school as they cut you off in the leased car).
Jeffeb3 says: “if you are working at your potential, and you like what you do, the money will follow.” Boy, I think that is the KEY! At least from my own personal experience. I always had jobs I loved — like I would have worked there on a volunteer basis, but of course would never tell my employers that. I looked forward to going into work on Mondays and if it were 3:00 p.m., I’d often wish it were 10:00 a.m. again, because the day was going by too fast — that’s self-actualization, when you are doing what you enjoy so much, and are being challenged and working right up to your potential. Consequently, saving 20% of my income was easy for me. Compare that to many, many friends I knew who had big salaries, but hated their jobs. Rather than saving, they would spend/waste money big-time to “justify” having this miserable job, like getting a McMansion and shiny new cars, etc. I was willing to live on much less because I enjoyed what I was doing, much like what “starving artists” will do. The key really is to follow your heart, and the money will follow.
@47.daedala
Ooh. Social climbing is a great reason to go to uni. And I mean that in absolutely the best way. If you aspire to live a middle-middle class lifestyle in the UK then your best bet is to go to Uni, and mix with people born into it. You’ll pick it up in no time.
It’s really difficult to believe this right now, but I sincerely hope that it’s true. I’m 22 and last summer I finished my Bachelor of Science in Psychology. The diploma’s hanging on a wall in my bedroom, of all places, and the two times I’ve tried looking for a job, I’ve been made to feel that my degree is completely useless. Most people are looking for specific degrees, and nobody is looking for a Psych major unless they’re in graduate school. This may just be how they advertise it, though, because frankly I don’t even try for the jobs that say “Marketing degree required” or “Business degree preferred.” It seems self-evident that it would be pointless. Maybe if I tried, I would surprise myself and succeed? Anyway, right now I’m taking computer programming and design classes at my local community college and I’m starting to feel disappointed with that, too. Maybe I’m just burnt out.
Christina, I found this article 4 years later and I’m on the same boat as you were in 2008! I thought I wanted to be a speech therapist, but realized it wasn’t the right fit in my first semester of grad school, so I dropped it. I got a well-rounded education at a private university, with not that much in debt. Now I am job-hunting and feel as you did towards those “Business degree preferred” job ads.
I am curious to see where you are at now. I hope you have found success… Any advice?
Interesting, Jeffeb3 and Sandy. I’ve always loved the notion do what you love and the money will follow, but I’ve never trusted. I’ve always been scared to. And so for most of my life, I’ve worked at jobs I didn’t like. (The only two jobs I ever loved were food service jobs, and I did well in them.) Most of my life, I’ve had money problems.
Now, for the first time, I’m doing what I love. I’m writing. I’m sharing stuff with you guys. I’m having a blast. And all of a sudden, I’m spending much much less, and I’m making enough to make ends meet. This is a real-life example of the money following me as I do what I love.
Another aspect, though, is that what I’m doing here is the culmination of everything else that has ever come in my life. I’m writing, using my psychology degree, learning what I’ve learned from jobs in sales and computer programming. It’s strange, but it’s as if my whole life led to this. And college was a key component.
I can say from my own experience that having a degree has kept me employed and fairly well paid.
I have to say the best plan I have seen work for people is to pick which college they want to get their major degree in, find out what liberal arts/non major classes will transfer credits from a cheaper community/public school and spend their first two years getting the requirements out of the way for less money. Then go for the more expensive school to finish the bachelor’s (hopefully paying as much as you can for it on the way) and if necessary to your goals, the master’s degree after working for a few years and saving up for it.
It really all depends on what you want to do – a year or two of business classes at a community college may be all someone needs to create success for themselves.
My own choices would have been different if I had supportive parents – I’ve been making a good living purely on the magic of having the degree I have from the school I have it from – but in the long run it hasn’t been worth it.
No matter what – pursue what you ENJOY and feel fulfilled at. I made good money and it hasn’t made one bit of difference in my happiness. Frankly I have been miserable and I despise my profession – all because I was pressured into a major because it was more lucrative than what I wanted to do. I would have been FAR happier making $20,000 a year less if I had been doing what I loved.
So my three life lessons: Lesson 1) Only go to school if 1) you can afford to for fun and education and 2) if it will help you reach your goal – Lesson 2) Stay out of debt as much as possible – Lesson 3)Do what YOU love to do, and second best, do something that pays the bills without breaking your heart.
Great post – I have been thinking about writing something similar for my site for a while now.
My basic story is this: went to college at 18 and studied something I did not like and dropped out. Worked for ten years and decided to go back and study something I find very interesting.
My motivation was not to make more money: it was to give myself more options and new ideas. While I am not yet finished with my undergraduate degree, I feel like I am already reaping benefits.
* I feel more confident in my knowledge and my abilities to think analytically as well as to think critically about my own beliefs and biases.
* I am better able to present arguments and information to coworkers and colleagues.
* I am able to have informed conversations and network with people who are involved in my areas of interest.
* I can see entrepreneurial and career opportunities which I did not see prior to this round of college.
* I have been pushed harder than I would have pushed myself.
* I feel like more career and post-graduate options are available to me. Like other commenters noted, sometimes those hiring just want to see a college degree.
I think that one thing that gets people into trouble when considering the value of college is thinking of it like a vocational school. It’s not. The trick – I have found – to being successful in college is not to ask yourself “What am I going to do with this?” but rather to keep yourself open to new ideas and experiences. By doing that, I have done things and gone places I would not have conceived of going into this. Same with jobs. Unless you have a deep knowledge of a field you can’t really see what job opportunities exist.
Finally, I want to touch briefly on the financial aspect as this is an important consideration for many. Myself included. By going to college for the past two years I have had to scale back my work hours by half. Over the course of the college career this means that I will lose over $100,000 in income. That sucks. Plus what I am paying for school(which is reasonable – I go to a public school).
However, I consider it an investment. Granted, there is no certainty that I will see a return on that investment(this holds true for all investments), but as a pure financial calculation I am literally banking on the fact that I will. As I mentioned before, I have already recouped some of that in non-material ways. And I am loving every moment of it.
I just finished a PhD in biology. I stand to make about $45-50k in postdoctoral research positions for a few years, after which point I will have to decide whether to go into industry or pursue a tenure-track job as a professor. I don’t anticipate ever making six figures in my life.
However, my job allows a huge degree of intellectual freedom – I can be sure that, every step of the way, I will be doing something that I’m interested in. By going into industry I may make more money but I will have to relinquish some of that freedom.
I don’t need to go back and tell my 18 year old self anything, because my parents gave me great advice when I was looking at colleges. They made it clear I should not go into debt for my education, and that I should do what I was interested in, and not worry so much about how much money there was to be made in that field. They recognized that it was the process of learning how to learn, rather than the piece of paper I got at the end, that would ultimately benefit me.
being that i am 42 and just now returning to school having raised my 4 children-i would tell my 18 year old self to quit partying and having fun. you never know when you will be 42 years old trying to help pay the college education of 4 kids. i refuse to go to work for $7.00 an hour, so i am working really hard for the next 2 years to become a special ed teacher. this is a field which is i will be accepted into regardless of age because of the vast need for these teachers.
I don’t have any experiences that agree that it doesn’t matter your discipline so long as you have the degree, but there’s another option at some schools: build your own degree. I’m doing this at my school and while stressful, it just might allow me to do what I love outside of college too.
@JD
I think it’s do what you love, and you won’t need to medicate your unhappiness by spending. In that sense the money will follow.
My biggest advice to me as an 18 year old thinking about college would be “You’re right not to care about job prospects in your degree – if you love it, you will do well at it and that helps more than anything else”.
Even if another subject is more lucrative, better to have enough and be happier than do something you don’t like at college.
One of the most fascinating degree/profession combos I’ve seen was the lead singer for the rock band, The Offspring. He has a masters degree in molecular biology and turned down PhD candidacy to focus on the band.
http://en.wikipedia.org/wiki/Dexter_Holland#Personal_life
Whoa this is creepy. I just wrote about the same thing a few days ago:
http://www.thewriterscoin.com/2008/01/07/why-a-library-card-is-more-valuable-than-a-college-degree-the-pros/
@plonkee, J.D.
If I did whatever I wanted, I would do something between talking with friends, and enjoying TV and movies. That isn’t profitable though, because it’s not challenging. The key that most people miss when they think about their dream job is that they need to feel pride.
The other day, Dave Ramsey made some snide comments about German Polka majors. I thought it was right on. Though there are obviously exceptions, but I agree that people, particularly people in positions to hire a bazillion competing college grads, are not impressed by fluffy degrees like that.
If only that wage scale was right! My husband has two degrees and doesn’t make even close to what it’s claiming! People with only a HS diploma make more than him…
Schooling is important, but it’s also important to pick the right field. I tell everyone who is just starting out not to go into multimedia and graphics unless they don’t want to make a lot of money. You really have to pick the right career based on the pay, and if you enjoy it.
I’ll gladly take the average dropout’s income, where do I sign up?
I have a B.A. and will have an M.A. in May and do not make the average salary for someone with a college degree. I work for a Fortune 500 company. Something is not right here…
If I had to do it all over again I would definitely get my college degree. I have only an Associates Degree. I pray every day that my son (who is six now) will go to college. I just don’t want him to be miserable like me. I hate my job and I’m stuck; nowhere to go. However, if my son does get a college degree I hope that he wont be like most of the college graduates that I work with – they look down on the people that don’t have a degree.
It’s hard to see how someone could actually regret going to college… although I never use what I learned in school, the contacts and experience were both invaluable.
My only regret? Student loans at a high interest rate. I should have done a lot more work when I was applying to colleges to try to minimize these. But I was lazy and ended up having to get a lot of private loans.
Luckily I was able to pay off most of them in 1-2 years, but I could have saved and invested a lot more if I didn’t have them to begin with.
I tell all my younger friends to go to college, but to make sure it’s cheap or scholarship-funded first.
And on the issue of pay and doing what you love, I think most are scared for the same reasons you were. However, I’m finding that as I move toward doing what I love, money is much easier to come by as well, plus I’m inclined to spend less.
Matter of point here from an economist:
The wages listed in the summary table are averages. Therefore, those of you who are saying its not right because you’re not that figure are either to the right or the left of the average.
The actual point, which is that education is highly correlated with a higher earning potential, is correct.
To argue that education doesn’t have significant impact on one’s earnings is to ignore the data. While other factors are important, education ranks among the most so.
To “Minimum Wage” if you’re still around: I’ve seen you on a variety of personal finance blogs, and even the WSJ blogs (same handle and attitude).
I am tempted to say that you maintain your minimum wage “fate” because you have a defeatist attitude and maintain a lot of ire (jealousy?) for those with more dollars than you. I wouldn’t be ad hominem here if I didn’t see a consistent pattern.
Anyone, perform a Google search for “minimum wage says” or “comment by minimum wage”. It’s fairly consistent.
Sorry for the threadjack!
My husband went all the way through high school only to be denied graduation. I live in Texas and each school district has it’s own set of requirements to graduate. He transferred districts his senior year and was missing two of his new schools requirements. This was in 1988 and this same stupididly still goes on.
He distrusts any school now and just got his GED two years ago. He is currently at a high level position in a major corporation earning well over six figures.
Me, I finished high school and took some college. I quit working out of the house to have kids. When I left, Sprint I was making around 55,000. I work from home now growing my own business.
It may be in our field knowledge and experience counts more than a degree. I’d like to get that check someday but I’m sure it will be when the kids get into school full time.
Jeffeb3 and Sandy–thank you for your posts. Story of my life: my parents were unsupportive of my decision to go to interior design school. They made me so miserable during my first year of college that I transferred to another university to find a more lucrative major in order to please them. After failing to get into business administration, I ended up with a degree in International Studies. Then I moved out and returned to pursue my degree in interior design. It took me many years since I was working full time and taking classes part time. But I finally graduated last year with honors. I was able to secure a good internship and look forward to more opportunities ahead. I have no doubt that the money will follow.
Well put! I returned to school after the birth of my daughter (after a 4 year layoff). It was tough going back to school at night and working during the day, but in the end it was worth it. The degree certainly wasn’t prestigious (Computer Info Systems, Troy University), but the knowledge I gained has allowed me to nearly double my income since I started school.
Education gives many a definite edge.
Though the degree itself doesn’t define you -it definitely helps you to develop into a stronger self:
* It aids in critical thinking,
* It helps you to look at life from a more global perspective,
* It gives you a greater breadth of choices.
* It also plays a significant role in allowing you to make strategic choices that will enable you to live out that dream of yours by making it real.
Nothing can replace the long-term benefits of an education.
And as for those who have acheived millionaire status without a degree…it’s highly likely that they were smart enough to recruit a few degreed persons to play on their team.
The bottom-line is what you said best: “The value of a college isn’t just in the destination, but in the journey.”
Thanks for the inspirational post!
College education is the most basic of our life. A college education also gives you a broad base of knowledge on which to build. It teaches you to solve more of life’s problems. It gives you future reference points for discussing art, entertainment, politics, and history. It must be given by the learning of opportunity.
It’s hard to see how someone could actually regret going to college…
Seems pretty easy to me. I started college with the equivalent (in today’s dollars) of $20K, and excellent prospects for a decent job.
I finished college with the equivalent (in today’s dollars) of $20K in debt, in a seriously depressed economy, with a dime-a-dozen degree and no real prospects for a good job.
I am tempted to say that you maintain your minimum wage “fate” because you have a defeatist attitude and maintain a lot of ire (jealousy?) for those with more dollars than you. I wouldn’t be ad hominem here if I didn’t see a consistent pattern.
When I send out resumes, employers don’t see a defeatist attitude. But my resume doesn’t get me interviews, so in jobseeking, we don’t even reach the issue of defeatist attitude.
I don’t have a lot of “ire” for those with more dollars than I, just for those who I think don’t particularly deserve it. I’m confident I’m more intelligent, more capable, and more deserving than a lot of these people, hence, there are a lot of people I consider less deserving than I.
I dropped out of college before completing my AA to take my first IT job 20 years ago. I never went back. My skills been self taught or on the job experience. I have always stayed on top of whats going on in the industry, kept my skills sharpened and am always adding new tools and knowledge to my tool box.
I have never had an issue or a doubt that it was a bad decision. I have always earned well, currently I earn what would be at the low end of the advanced degree category.
Now I work at a college and there is tremendous pressure for me to complete my BA degree, this completely frustrates me. I pay 0 in tuition. I find the courses a waste of my time, over simplistic, void of value, and dry old material that was useful in the real world 4-5 years ago. I receive more pressure to complete my degree, than I receive to get my job done, and meet my deadlines, you know, the things they actually pay me for.
Along with the pressure to spend extra time taking classes I am also the one competent and talented person in the department. Instead of assigning my degreed coworkers the large, complicated, and critical projects, I am saddled with virtually all of them. I have a proven track record of delivery and quality, where they do not. Those that are my age and even the younger ones all seem to have stopped developing themselves, they seem to feel they don’t need to, this the kiss of death in the IT business. This leaves me with 50-60 hour work weeks. I am pressured to spend more time taking classes, while my degreed coworkers do less work, are less productive. On many occasions I have had to redo things they have done. I don’t mind this at all, I am always challenging myself to find new and better ways to get things done. I am always shifting gears and getting into new things up to my elbows.
I think it’s ridiculous to require a degree as Item #1 for any candidate. I find it laughable that a degree is required for the most mundane jobs and that most HR departments make it a requirement when, at the same time the media and masses, and even this blog point out and celebrate the successful “drop outs”. Its a bit hypocritical. I feel the reason a degree is required is it helps those doing the hiring to justify the time, expense, and student loans they racked up to get their degrees.
Don’t get me wrong, for some fields there is a need for a degree and usually an advanced one. For 90% of the jobs out there, no it shouldn’t be a concrete requirement. In fact I feel a company is doing themselves a disservice and could be over looking some highly skilled and talented people by putting too much stock in having a degree.
A degree does not guarantee competency, skill, productivity, longer life, higher salary, interest in the arts, etc.
A degree is not a substitute for passion, confidence, talent, drive, and skill.
Minimum Wage,
Your experience is atypical. Did you get an unusual degree, or is there another reason why you did not increase your income potential? It may be that your resume doesn’t hit the right topics
To balance our your life experience, I went to undergraduate, came out and went from 20k to 35k. I went to graduate, and doubled my income. A few more years of experience and I’m moving again, probably 40% more.
EDIT: Oh, and this isn’t a seriously depressed economy, either now or 01. Seriously depressed was in the late 70s. What we’ve had since then have been the economic equivalent of a 24 hour flu.
The most valuable class I ever took in college was People 101. You learn more about people and interacting with people in the four years that you are at college than anything you may learn in a classroom. This is especially true if you go away to school.
Building your people skills is by far the most important takeaway from any college.
Think Rust Belt, 1980, Seriously depressed economy. Two-thirds of new graduates in my state were leaving to seek jobs elsewhere. Out of state newspapers were selling like hot cakes for the job ads.
I had a typical liberal arts degree, nothing particularly unusual about it. Took the first job I could get, after about five years in that dead-end position, my resume lost all appeal to employers. Hard to get a better job when you can’t even get interviews, and of course it just keeps getting harder and harder to get that job as time (and age) marches on.
I’ve seen plenty of folks with much less turn their lives around.
I’m sorry you had the unfortunate circumstance to graduate during the last truely bad economic cycle. Scrap the resume and start from scratch. Around here, I’ve seen that even the Fast Food chains have a track to management that can be completed in 3-4 and one can go from minimum wage to making 45K a year.
I frlipped hamburgers one summer and determinmed that I would nEVER work again in a fast food joint if I could help it.
I got a B.A. in Psychology. I’m currently working as a manager in a social work department but I’m growing dissapointed at the salaries that social service industry pays. Managers in other areas get more than I do. I’m thinking about getting an MBA but would like to do it online. I’m very worried, however, about online degrees not being equally valued or accepted in all companies. Any ideas?
From a selfish perspective, I think it is great that everyone perpetuates the belief that it doesn’t matter what degree you get, just get one. It leaves my competition in the workforce grossly underqualified for the best careers.
The fact is, if you are going to spend 4+ years of your life and the subsequent money in college, you are far better off spending it on a challenging and elite degree.
Most people are much happier having career options and the ability to do something they enjoy. That is alot easier to do when you are over-qualified with an engineering or technical degree, as opposed to relying on luck and years of struggle with a liberal arts education.
In the long run, the easy way out is to take the hard road for 4 years and coast on your credentials for the next 40 years.
Personnaly, I spent 6 years getting an Electrical and Computer BS, while stacking up great experience co-oping. That got me out of school debt-free and with 2-years of marketable skills and a chance to pick almost any career. Now I do strictly business developement negotiations and let my employer pay for my part time pursuit of a ECE MS.
One of my undergraduate majors was sociology, which influences me to always think about the larger social issues as well as individual situations. I’ve also been a University student advisor, working with students who haven’t declared a major, or are in a major that they aren’t suited for, and of course the occasional student who is loving everything about college.
Anyway, I think that as a society, college is useful as a place to “park” young people, since we’re really not generating enough jobs for everyone, and as many posters have pointed out, there’s a lot of maturing that takes place between 18 and 22.
But the connection between college and job is really nebulous; and while both parents and children assume that there is going to be a direct connection, I don’t see how there can be. Many jobs that used to be “pink or blue collar” and require only a high school education are now filled by people with college degrees. That’s not good or bad by itself. It’s the expectation that college = higher status job that’s the problem. And, ultimately, i think it is damaging to our culture that we often define ourselves and other people by jobs, instead of by more intrinsic evaluations that don’t depend on job title or income.
I have to come to the defense of Minimum Wage here. I think some of you who are probably in your 30s and 40s who are making mid/upper 5 figure salaries can’t relate to younger people who are being shafted by the current economy. I know you mean well, but I don’t think that you understand what we’re dealing with here.
Not only do I have a BA, but also a MA. I started job hunting 8 months ago, and after a few months the best I could get was a temp job that was represented to me as “temp to hire”, only to find out that the firm never had any intention of hiring me, but rather just wanted to keep me in place until a regular employee came back from medical leave. Did I mention that I was actually grossly over qualified for the job, but took it just to pay bills? I ended up moving out of state recently hoping to find a more robust job market. My fingers are crossed that I’ll find something in the next few weeks.
So to you individuals who have worked your way to of regular employment with good salary and benefits, good for you! I;m sure you worked hard to get where you are in life, but realize that your are fortunate in that someone decided that you were worth taking a chance on. Some of us have not yet found someone who’s willing to give us a chance to show what we can do. Please offer us advice, encouragement, etc. But please do not make character judgments against us (“bad attitude”). I don’t see how that helps anyone.
In my former life I worked for a bank in human resources. My job was to write job descriptions. Every single manager tried to argue with us that their position and the positions under them all required a college degree. It was bull, none of them did. As it turned out from a legal stand point only the top positions and advertising department were able to say that a college degree was required. Unfortunately many businesses claim it is anyway, when in actuality the position doesn’t really need it.
I think the major reason a college degree is “required” now is because HR people need to make a big pile of resumes into a small pile of resumes before handing them over to a hiring manager. (No offense intended to HR people — In my experience, a lot of them simply aren’t familiar with the jobs they’re trying to fill — IT positions, for example.)
I’ll bet that most of the folks who don’t have college degrees have gotten their breaks via their contacts with other people who know them well and are familiar with the good work they do. After job #1 of college, that’s how I’ve gotten the rest of my career breaks. As I mentioned above, though, I’m shy and we’ve moved to a new region of the country, so my local “network” is pretty anemic right now. I’m sure that my education would help keep my resume in the small pile, should I need to make “cold call” job applications.
FreshEngineer states:
“That is alot easier to do when you are over-qualified with an engineering or technical degree, as opposed to relying on luck and years of struggle with a liberal arts education.”
I would like to point out that it is not a given that a technical degree is an option for all people. Many simply do not have the strong mathematical skills required.
I went to a public school with a very highly rated engineering program. Since it was public, we had a lot of in-state students who were not the greatest at math/physics but still had good enough grades to get in and they were drawn to engineering for the money. They had to compete with students who were literally years ahead of them in math and many failed out of engineering. This was most pronounced in computer science where you had students with no programming and marginally math skills trying to compete with students who taught themselves C in junior high. Oftentimes there would be assignments that would take some 10-20 hours and others 1-2.
While I agree in general education is a great thing, as a social worker (master’s level, which is not exactly anything but a minimum in order to be able to make enough money to eat), I look at the average salary for advanced degrees and continue to think that social workers and teachers (my lady friend is a M.Ed) with advanced degrees just don’t earn very much.
–
Ryan
http://uncommon-cents.net/
wow I just found this site yesterday and it’s pretty awesome…a few points from a person currently working FT and going to school FT at night…
1. for a republic (like ours) to work we need an educated (read: competent) sector of people who will work in the best interests of all our society (technocrats, bureaucrats, etc.)
2. college’s most valuable resource: opening you to ideas and currents of thought that an overwhelming majority of mankind has never and most will never even examine – having a conversation like this alone is proof enough that college has been a wise investment (save those of you who walked out w/ manhattan-mortagage-size loans)
In the ideal world, a college degree would be just another piece of paper. What really matters is a person’s knowledge and talents…both of these can be gained at college, but they can also be acquired in other ways.
I never got a degree. And it has really hurt my options over the years. I’m smart, well-read, enjoy learning, raised middle-class. None of these are prerequisites for higher eduction, but most people simply assume I have a degree and are surprised to discover I do not.
Why didn’t I get a degree? There are several reasons, but the biggest was that I just wasn’t paying attention! I didn’t realize that having a degree mattered; my parents didn’t drill it in or I didn’t care or know what I wanted to do, I wasn’t focused enough – or all of those. Also at the time (mid-late 70’s) it just didn’t seem as important generally as it does now.
Whatever the reason, I can tell it’s hurt me. Only a few months ago I got a full-time salaried job (it’s been years since I felt I was on a career track), but then only because I started as a temp and they liked me. I’m starting at an “OK” salary but small for the region. I have very little savings and not much equity. A simple piece of paper might have made a huge difference.
I’m making SURE that my daughter goes to college!
I agree with James- the statistics are oversimplified. Certainly you can compare the salary for a PhD and a high school dropout- but what about the extra 8-12 years that it took to get the Ph.D.? What about all of the extra costs to go to school and years of lost wages?
I got a PhD, but if I had it to do over again… I would have stopped with the BS, and started work 7 years earlier. It would have made a lot more financial sense.
If the dropout got a good paying job, and saved a modest amount they could be a LOT better off than a PhD just starting their first job with a lot of educational loans to repay. It’s really tough to keep up with compounding, especially if you consider the possibility of 43 vs. 30 years.
Those income statistics are averages over a lifetime of work. What is college worth if you are already middle aged? Not much economically, I would say. Know what you want to get out of it before you begin, I would say. Wasting time and money can be fun, but it is expensive.
Check this out: http://www.usnews.com/articles/business/best-careers/2007/12/19/the-most-overrated-careers.html
Dr J
This is a great post and the comments are outstanding! Sure do wish your blog had been in business when I was teaching a short course titled “Jobs for Writers and Liberal Arts Majors.” (Yeah…well, it was part of a certificate program–we were trying to lure students into one of several programs in the liberal arts college.)
I actually managed to dig up most of the material you’ve presented here, but my presentation wasn’t anywhere near as interesting as yours. And the thoughtful comments readers have posted add a whole ‘nother dimension to discussion of the topic.
If you don’t mind, I’d like to post a link to this discussion on the BlackBoard sites for the two online courses I’m teaching in Writing for the Professions this semester. The sites are essentially intranet critters & so won’t be visible on the larger web, but it should send a bunch of bright young business, education, and communications majors your way.
This is a great post and the comments are outstanding! Sure do wish your blog had been in business when I was teaching a short course titled “Jobs for Writers and Liberal Arts Majors.” (Yeah…well, it was part of a certificate program–we were trying to lure students into one of several programs in the liberal arts college.)
I actually managed to dig up most of the material you’ve presented here, but my presentation wasn’t anywhere near as interesting as yours. And the thoughtful comments readers have posted add a whole ‘nother dimension to discussion of the topic.
If you don’t mind, I’d like to post a link to this discussion on the BlackBoard sites for the two online courses I’m teaching in Writing for the Professions this semester. The sites are essentially intranet critters & so won’t be visible on the larger web, but it should send a bunch of bright young business, education, and communications majors your way.
(Uh oh! I accidentally double-clicked on “Submit comment”…my apologies if two of these things shows up!)
@JLP #87
Minimum Wage is a personal finance blog junkie who, at every opportunity, trashes himself or herself, has the most defeated attitude, claims that dental problems prevent him or her from getting a job, claims that a lousy resume prevents interviews, and is just your basic troll.
Never have I heard mention what his or her degree was in because telling us that it was in business,or English, or communications or whatever would mean that he or she could no longer complain due to the fact that others with the same degree would offer substantive, doable suggestions to get out of the minimum wage lifestyle.
MW won’t tell what city or state he or she lives in. There would be solutions to his or her problems at that point and MW isn’t interested in solutions only complaining.
All I know is that the last time my resume got me an interview was about five years after I graduated.
What do you do with a social science degree? (I wanted to go to law school but couldn’t afford it.) People seem to think I should go into social work (that’s a more specific field with more specific training) or social services, like I should be a welfare case worker or work for a nonprofit dealing with some sort of “problem population” like the homeless or excons or druggies. That’s not at all what I want to do.
Employers don’t hire people my age with dead-end job histories for good jobs, especially when there are qualified applicants half my age. At this point, that’s probably my biggest obstacle.
I would tell my 18 year old self, “You have been right all along.”
This post is really interesting, and I have enjoyed reading through the comments.
When it comes down to it, I think the reality is that those people who are bright and motivated are going to succeed when they go for it, regardless. That is the end point.
To go further… above, people were saying that giving the extreme as an example is not showing the truth. While this is a valid point, I think that in this age, we’re seeing the extreme become more and more commonplace. As a commenter said above, these days, there is no cut an dry. Sure, if you want to be, say, a speech-language pathologist, you have to get a MA SLP and get certified, but those jobs that require a specific degree are a very small percentage of the jobs out there.
Your point about the life experience from college is a very strong one to me, but still invalid when said just for college. If someone, such as myself, chooses to work straight out of high school and learn life from a different perspective, how is that not learning life too?
In my experience, most people who go to college straight out of high school continue to live in the immature, high school mentality for another 4-6 years before snapping out of it and growing up and into themselves, whereas those who move on and do something with their lives immediately are thrown into reality – without the cushion of dorms or class schedules or in many cases, their parent’s money.
Both my fiancé and I went to work straight out of high school and we both make over $100k a year (I’m 22, he’s 30). I think the reality is that, as I bolded above, those who are sharp and motivated are those who will succeed (at college or otherwise). What’s the statistic on people who dropped out of college? And those who went to college but never did anything with their degree? I know plenty of people who have an MA in something and work as a server at a restaurant. All of my closest friends went straight from high school to work, and we all are very well off 🙂 The opportunity was there because of our natural curiosity towards activities and career fields, and our pursuit of the knowledge required to work in said career fields because of our interest.
The advice you give to “do what you will enjoy, regardless of the degree” can be employed equally to the workforce. Do something you enjoy and do well, and you will be promoted and get raises and move forward with your dreams all the same.
IMHO 😀
I’m one of the funny ones, I did it all the hardway and tell people not to do what I did. I got my GED insted of doing my finals in 10th grade, puttered around community college a bit but never got a degree. Insted I had to fight long and hard to prove myself. I managed to get there after many extra years and I’m now on par with my peirs who did the education system… and take a class now and then at the local college.
I learned a ton in college and went through so much personal growth. I am a teacher with two masters degrees and will retire making less than the average for people with bachelors degrees, but I have a stable job that I love.
If you’re looking to try a new career, inner-city and rural districts always need teachers, and everywhere needs nurses. You can get trained for either without an additional 4 years of college.
I graduated from a private liberal arts college over 7 years ago with a degree in History and English Literature. I received a very nice education and did quite well academically. However, my job is not related to my areas of study and my pay is mediocre.(My student loans are paid off though and my finances are in nice shape regardless). I absolutely do not regret attending college. A college degree will open up more doors than not having one.
I think that guy is giving minimum wage a hard time. You know, I admire people who even go to College. Its almost like having a full time job. You can’t GET EXPERIENCE WITHOUT SOMEONE GIVING YOU A CHANCE. Employers expect a College Education and tons of experience. WHO GETS TONS OF EXPERIENCE WHEN THEIR BUSY IN SCHOOL? Most of your time and energy is spent in the classroom. What do employers expect? You to have no social life, Work full time, lose sleep,lose energy, plus go to school full time? Well I’m sorry, nobodys going to kill themselves for a job. That will cause major damage to your sanity. Bottom line, if they will just give College graduates a chance to prove themselves maybe they can get their foot in the door.
Major: English Lit
Current career: IT consulting
Backstory: Apple IIe geek in high school. In college, started as computer science/pre-med. Got bored with comp sci (this was in the pre-Windows era) but made a challenge to myself. Hated English/literature classes in elementary school and graduated with a lit degree. Growing up helps you appreciate the good things in life.
Heh, came across this one late, but I wanted to add my $0.02. First went to college (local CC) as a Communications major, did not do much other than see-saw on classes and play in my band at nights (which is what I *really* wanted to be doing that that point in my life anyway).
I discovered the Internet and companies that made equipment for it in 1991 so I dropped out of school completely to work in that sphere. Went back to school for a bit in 1997 to build up my math deficiencies since I was working in an engineering department, but didn’t go much more than that. In 2002, was dealt my first of three layoffs, when I found out that not having a degree in a down market made for a rough job search. Decided to bite the bullet and go back to school full time and finish my Bachelors Degree in 2003. I chose Information Technology sing it was my active career and had been for twelve years. I Finally finished my bachelors degree in 2005, almost 20 years after I started it. What would I tell my former self? Go back and do it right the first time… which is what I drill into my kids heads just about every day (LOL!).
Ted Turner actually majored in economics.
Of course a BA in psychology is worthless, didn’t you know that? Everybody knows that the only degrees worth getting are in Engineering, Economics, and Life Sciences (if you plan to be an MD).
Have you EVER seen a job wanted add that said:
requirements: BA in psychology.
So what we are saying is the type of degree you get is important to your future earning potential?
I’ve recently (04/2008) received my BA in Business Administration from a small private college. Now I’m contemplating my next education move. Do I go for an MBA from a respected state university and take the GMAT along with apply to a new school, keeping in mind both have the possibility of rejection? Or do I stick with my small private school and enter their Masters in Business Leadership program in which I’m already accepted and no GMAT?
Keeping in mind that I obtained my BA as a working adult and would continue to do the same for either masters degree option (MBA would take about 3 years while the MBL would take 18 months, MBL cheaper by about $10,000).
What are everyone’s thoughts?
I graduated with a BS in Bioinformatics this past June. What am I doing? The same computer programming job I’ve had for two years (technically second programming job, I left my first one for more money). There was no barrier to entry, just skills I needed to know which I was able to learn on websites in a few days (equivalent of about 3 semesters of in college I had to take anyway). I went through with college in my last two years while working only because my parents asked me to and were willing to pay for it. Frankly, I feel they wasted their money and my time, but I love them anyway.
It’s never about the school/title/degree. It’s about what you know, and how to find out what you don’t know.
College is only worth it if you have a reason to go there – to learn something you wouldn’t otherwise learn elsewhere.
Great article. I passed up going to college right out of high school, because I wasn’t sure what I wanted to do, and because I was really afraid of the debt I was about to incur. I felt like a loser for a while about not going, but everything happens for a reason and now I am attending a Major University pretty much for free. I feel that the time “off” after high school envisioned me, and now I have been lucky enough to get free tuition, so it has all worked out because the time is right to go. People incur so much debt, but you can go for free just like I am, so I say give that a shot before taking out student loans.
I definitely regret the student loans I have. I went to community college my first two years and didn’t have to pay. My last two years cost me, though, and to be honest quality of education did not justify the jump in cost per credit hour. Many of my professors in community college taught at the university. Same quality, $50/credit hour vs $200/credit hour.
A different outtake:
I dropped out of HS at 17, at 19 I landed a temporary job at a unionized company. I was made permanent and by the time I was 24 I was making over 85,000 a year (with OT).. I bought a house that year too. This was in the early 1990’s.
While I wouldnt recommend doing what I did to anyone else, I feel for myself Ive done pretty well for myself.
I joined my 401k plan at 20 years old putting in the max and also recieving a company match of about 85%.
Friends of mine who went on to college had to borrow money, then look for jobs at the same time they were stuck with student loans.. On top of that most of them were qualified to be “office workers” making copies for the boss.
I figure that in the 4-5 years head start I had over my peers that:
1)I accumilated a nice nest egg in my 401k with the added bonus of compounding. My head start in savings is becoming apparant now with the growth of my 401k over the years.
2)I have made “real money” since I was 21 and when my peers were entering the workforce I was already making 100k a year (with OT) and Ive had several years of earning ahead of them
3)My social security will be better
4)I have 4-5 years of seniority gained and experience in my field.
5)Back to my peers: I was earning a living while they were in school (partying) and making minimum wage while running up the student loan tab
6)They have the handicap of the student loan to payback while I do not. Thus I am better off financially.
7) Since I was able to by a home at a young age I will own it outright at a relatively young age.
8)I bought in before the housing market went crazy so I paid a lot less for a house then my peers who bought years later. Of course this is luck and right timing but I saved a few HUNDRED THOUSAND dollars on a home- imagine I had went to college, graduated, saved for a home (while paying student loans) while the housing market took off like a rocket ship– Id have double to triple the monthly payment I have now!
Like I said this is my personal story and I dont recommend doing what I did to anyone. But I figure by starting out with a good paying job at a very young age I will wind up doing better then most of my peers at the end of my working life.
BTW ,in a touch of irony I got my GED a few years back and my employeer paid my tuition to enable me to get a degree! This degree has no bearing on my current salary since I am a bargained for employee but it is ironic since I got it for the grand cost of zero dollars!
The reality is that many people with college degrees just getting into the workforce start out with low pay. The worst thing to do is get angry, feel cheated, complain about how “unfair” it is in the workplace (the bubblegum chewing receptionist with three inch nails who makes more than you, blah, blah, blah). Best tactic is to get over the anger, forget job hopping as well because it’s the SAME wherever you go – favoritism, nepotism, gossip, politics, people you like, people you don’t like etc. Same story, different characters. Be thoughtful, patient and diligent. After all your degree only takes up ONE line on your Resume. Think about that. The rest of the blank page must be filled in with solid, successful work experience and this takes time.
This piece is a bunch of BS. Most college graduates do well for many reasons beyond their college education (higher scholastic aptitude and they come from wealthier families). This premise that if I get any degree is a major fallacy and not supported by any data.
And so now we have too many kids going to college, and too many of these studying things like Philosophy and History (which I happen to love) instead of subjects that will make them more competitive in the job market and the US more competitive in the world econoomy.
John,
It is possible that if you had studied history or philosophy you would have made a cogent argument that would have convinced me of the soundness of your view. The ability to entertain and refute opposing viewpoints is a valuable skill in almost any job market.
I agree that many people go to college for the wrong reasons, but that is not a basis for discounting the entire experience. A degree alone will not help, but evidence does suggest that degree holders earn more on average than non-degree holders.
I’m going to go ahead and throw out “the man” as a source for education. I traded 4 years (7, actually) of my life for a free ride to a BS in Finance. Yes, I had to join the Navy (Oh, no! A GUARANTEED job after gruaduating??) that actually pays pretty well (don’t let the whiners fool you, taxpayer).
I am out now.. My degree really doesn’t mean squat, which is frustrating, but I intend to get my MBA now, which (you got it) is going to be supplemented by “the man”. If my math works out I’ll have a bachelor’s and an MBA for around 5K. I don’t care how you slice it, I think that will be a good ROI.
You always have to look at the expense side of the column folks!
Hexodus
There is no evidence that shows that high school grads with the same IQ, and good grades in high school make more getting a Philosophy degre than starting out as a plumber or a Cisco network specialist.
What the data does show is that on average college grads make about $1million more over their lifetimes than non ccollege-grads. But this shows a correlation and has not been shown to be cause and effect.
There are many reasons that college grads earn more than non grads including that they tend to come from wealthier familes, on average have higher IQs, and are better readers. But the question is do two similiarly situated high school grads have a different earning potential going on to study History or Philosophy or doing something more rooted in reality. I don’t have this data but you are going to have a hard time convincing me that the Philosophy student is going to make more money than the plumber.
I have met plenty of college grads who cant: do their own taxes, manage their 401ks/investments, change their own light bulb, make decisions, figure out simple math without a calculator..
The degree sometimes means you can sit thru college and pay (or get a 3rd party to pay the tuition) and do the tasks asked of you..
And i dont mean to insult anyone who has gone to college, it just has been my observation that the “smart ones” arent so smart after all.. Just look at the entire financial sector and the scams and meltdown.. These are supposed to be some of the smartest people in the world and they managed to ruin the worlds economy
I’ve never met anyone who couldn’t change a lightbulb.
College doesn’t teach life skills, nor is that its job. College is supposed to teach job knowledge with maybe a little bit of training. (More training and less knowledge would be nice.)
But all of the number-crunching neglects that there are things you learn in college that don’t have price tags. My college experience was incredible – I changed and grew and stretched in ways I didn’t know possible, and in situations and experiences that would not have been possible had I not gone to college.
Am I using my degree? Yeah, but I’m a teacher, so my degree is certainly not ever going to get me a lucrative job.
While it would be difficult to overstate the importance of managing money, there is more to life than dollars.
This is a great post and is encouraging for me. I too, have struggled over picking my major, and ultimately decided on the one that would get me my degree the fastest. I’m glad I made that decision, and this post proves that the major is not what’s important- its the degree itself. Thanks a lot!
The change the lightbulb comment was more metaphoric.. Ive seem some educated people flub simple tasks, or could not actually grasp an idea.. In my experience Ive seen the highly educated unable to comprehend or perform such a simple task, while an uneducated servant or immigrant laborer can grasp and understand the task at hand.. The light bulb -yes most people can change one, but my point is having the degree on the wall doesnt always mean you have the smarts that are supposed to go with it
I totaly disagree with this article. I have a bachelor of science in chemistry and a masters in physics and I cannot get a job. I live in Florida and attempted to get a substitute teaching job and determined that the salary is about 28,000 per year. The door man in my condo building has a high school diploma and is making 39,000 per year plus tips. I have been looking for work nationwide and I get often told that they are looking for someone wiht experience. I an now working on my PhD and when I graduate, the story will remain the same. no experience. If I become a teacher, the salary goes up only by $2,000 for a phD. I need to know what the value in education is? I also know people that are earning 78,000 per year with just a high school diploma. I could never earn that much with my Masters and my future PhD. I am dissapointed that I wasted my life getting educated, having no family for nothing.
Your case is but a single data point. You can’t legitimately disagree based upon your experience and a couple of friends. Mileage varies, and the reasons for your failure could be completely unrelated to your education.
Please reconsider your position.
Dear author,
The value of education is complementary to who you know. I am sure you heard of the saying “it is who you know not what you know”. My perspective is that if you do not know someone on the inside of a great company to help you get a good paying job, you can have all the education in the world and it will not help you. The people I encountered in my former jobs were not educated past high school but yet were related to managers and employers and thus got paid more than highly educated individuals. We see that in society all the time. My point is that education is over rated. My case is NOT a single data point, I know a lot of MS and PhD degree holders that are jobless in this economy. Companies would rather eliminate high paying jobs rather than low paying jobs in order to achieve a healthier bottom line. Education is good to have but is not the sole contributor to success. I got my education because I enjoyed the knowledge I received. I recommend that prospective students seek higher education for the knowledge that is achieved through the process but it is not a get rich scheme. The field that a student goes into also contributes to financial success. I recommend that a student thinking about going to college should not worry about the money but rather concentrate on his or her interests. I strongly recommend joining the service (army, Navy, air force). It is a great place to get educated and build contacts that will assist candidates achieve their goals and get great careers.
Jay-Z, Kanye West, and plenty of other famous, rich business men never went to college.
“I got my degree, now I work as a secretary for G-Unit!”
G-Unit was started by a man without a degree.
Hi, actually obtaining a college degree in Organizational Management has been a good thing but a long road. I beliee that a college degree is for all of the hard work one will put into getting a four year degree, but in the end, they may not be able to find a great job in this ecomony but it doesn’t hurt to have one. The salary earning should almost double or triple now with the requirements so many employers are looking for. Going to college takes time is a responsble thing to do and does open a few doors.
I think that part of what may be going on is that going to college has become a largely “passive” activity for many.
In the old days, going to college was special. You didn’t do it unless you were highly motivated to do it. Those who are highly motivated to do things tend to succeed financially over time.,
Today, there are many who go to college just because it’s the thing to do. A good percentage of those probably do not see big financial success over time.
Those who go to college because they are highly motivated to do so probably still receive huge financial benefits for doing so. But there is no guaranty that going to college is going to benefit you all that much financially. The motivation that used to be highly correlated with going to college is the thing that matters.
Rob
J.D.,
I have to say after reading your guest writers over the past week that it is a close tie between Jason and Karawynn.
Jason,
Great article. I attended private Catholic schools for grades 1 thru 12, a public four-year college, and a private university for my master’s degree. When I left graduate school, I owed about $35,000 and that was 9 years ago. We owe about $365.00 dollars now on that debt. Unlike most debts, educational debt for the most part enables the individual to appreciate in value. This being said, I think those looking to take student loans need to take a reasonable approach to accumulating debt and consider community colleges for their first two years then followed by their final two years at a public or reasonably priced private college or university. I would strongly encourage young people and their families to visit with a NAPFA certified CFP who is fee for service only to determine what they truly can afford and then build a solid plan from there.
A buddy of mine had a father who made him write up “business plans” any time my buddy wanted something. I believe the first one he wrote was when he asked his dad for a bike at age 9.
That’s a tad extreme… but its probably a good idea to make your progeny do the same before you pay for their college.
You can take that cash you saved for their education, and either put it into a long-term retirement trust… or, you can give it to them that year to pay for college. But… every year, make them polish up their business pan with how much they expect to spend, how much they will earn after college, and expected rate of return.
Both my wife and I paid for college ourselves. We worked in high school, and through college. We knew what we would have to pay back. That “fear” helped us focus on getting degrees that had good return-on-investment…
This is a nice post Jason. Really got me thinking. Things are of course a bit different where I live (Amsterdam, NL) but the same considerations can still be made.
I liked this post a whole lot better than the one you wrote before. Thanks!
The thing about all these statistics is that tons of scholarships are given out and there are lots of ways to cut corners. I definately did not pay anywhere near that much for my college education 5 years ago. Students just have to be dedicated to being resourceful.
I think it is valuable to have this discussion and not make assumptions that everyone is better off going to college.
I have just been through college searches with two kids in the past 4 years. Tuition figures are scary but can be highly misleading, with most students not paying anywhere close to the “sticker price”. A local private school offers a number of discounts to local students which actually brought the tuition in line with the state university system.
Our state (Virginia)has an agreement with the community colleges that if you achieve a reasonable GPA( I don’t remember exactly what it is, but it is within reason) for 2 years that you are gauranteed acceptance at a 4 year school for the final 2 years to complete a degree.
I read an article last year about a college which was trying to keep its tuition lower than its main competitors, and their applications fell off. People perceived the lower price as being of lower value.
Colleges are viewed as status symbols and it is high time we started using the principles espoused on this site to evaluate colleges on value rather than status.
The 529 plans we have set up for our kids really took a hit last year, so we know we’ll have a struggle to even have TWO years (one for each kid) of schooling saved up for our kids by the time they need the money, much less four years each. At this point we’ll probably go the same route my husband did: go to a college while living at home. Fortunately, we have 5-6 great schools within an hour’s drive from our house. My husband and I each had different college experiences. I was 8 hours away from my parents and lived on campus at a private university. My husband lived at home while taking classes at the nearby public college. Part of me says, “Send them away! More than a day’s drive away! Let them learn to grow up!” but the other part of my winces at the idea of forking out that kind of money.
@Jaynee – There are lots of things you can do to reduce that college bill, and living at home is definitely one of them. Although, to be honest, I wouldn’t have gotten nearly as much out of college (during the time I was there) had I lived off campus. I personally think that the interpersonal skills, responsibility, and life experiences I gained were much more important than the degree itself.
I understand the concern about funds, though. When I see the numbers I found for this article, I do more than wince.
I really wonder how this would play our if you seperated it down to colleges within the universities. I graduated a year ago with an electrical engineering degree. My best friend graduated with a philosiphy degree. He was a 4.0 student and now assembles glasses for about $8 an hour. I was a 3.0 student and work as a project engineer making 4 times what he made.
I think for too many, the degree is secondary to the college “experience.” The average high school grad could probably get the same experience by moving to a college town and attending a vo-tech. It will be much cheaper (or here in Oklahoma, free) and after words you would probably be more marketable than many college degrees.
This blog seems to be very anti-college. The other staff writer wannabe who said he attended his dream school was critisized heavily in the comments. Why is it so bad to achieve a dream of 4 years at a school that makes you happy and is an investment to your future, but there is sympathy for those that bought an extra $100g worth of house when they could have lived in a smaller one? It’s just a different dream.
Also, I think it would be beneficial to compare the SAME jobs with and without a college degree. Some you NEED to graduate a college to become (doctor, lawyer, engineer), and some it’s just very hard to become now without the degree (such as many professional jobs). So, if you want to be in certain fields, especially if you want to avoid manual labor or assistant work, and still get a “good” high paying job then college may be worth it. College also gives many more options. I’ve worked in HR and recruiting, the easiest cut when looking at resumes is to toss any that didn’t graduate with a bachelor’s degree.
Also, the more common college becomes, and now there’s a huge market for people going back to school part time, then these numbers may change in the future. In 18 years who knows what sort of qualifications you will need. Right now a lot of the labor force is people who were 18 during years when college wasn’t an absolute requirment. When those people retire in the next few decades, then the work force will be mostly people who did go to college, or at least were expected to.
It’s always interesting to me when people say, “Not everyone should go to college.” These people are almost invariably talking about someone else’s kids–not their own. It seems another offshoot of the “Not in my backyard” phenomenon.
One thing few of these analyses seem to include is the amount of students who receive grants, scholarships, and work study money. They also rarely include any kind of discussion of what our economy might be like if we produce substantially fewer college grads. We routinely hear about how the employment sector that has been hit the hardest is the trained labor portion of the economy, and yet people still wonder if college education is worth it. All the while, adult enrollment numbers in colleges across the country are increasing because people want to be qualified for the more secure and expanding employment sectors of the economy.
Finally, I’m not sure why it would surprise anyone that public college expenses are increasing. Americans persistently demand lower taxes, and they routinely target education as a place to cut expenses. This is because I think we as a culture have a very bad idea of how much education costs. When people consider the “cost” of college, they assume that what it “really” costs is the amount of tuition at a public institution. Why then, they wonder, would anyone pay the exorbitant rates of a private institution? Of course, they neglect the fact that theirs and their neighbors’ taxes are paying a portion of the costs of the public college system. If we allow legislators to continue to strip public college education budgets, then I think we will see an even sharper increase in public college tuitions. Because, guess what? To provide a quality four-year education *is* expensive. And I worry about the cost to our society if we keep sending this newly en vogue message that college is like a luxury sports vehicle–nice if you can afford it, but not necessary and not likely to make your life better.
Sometimes a purely individuated economic analysis does not provide a very clear picture. I would assert that the cost of college cannot and should not be analyzed the same way as buying a car. I would offer that it should be analyzed the way that people now realize they should look at their houses–not as candidates for potential “flipping” and a huge windfall, but rather as both an economic and an emotional investment that is not primarily about gain. And people seem to realize this as they say that “College may not be for everyone” while always thinking in the back of their minds “But surely it is for my kid.”
I agree with the above post that points out WHAT your degree is in is often overlooked. Your passion may be sociology and English literature, but if you aren’t planning on teaching, maybe you should consider a different major. It’s tough to figure out what you want your career to be when you are 18, but I think that it is a failing of high schools that the focus is getting into college and not basic career planning, or skills assessment, to see what careers the students are likely to enjoy. $100k debt may be worth it if you now have a degree that supports a career that makes over $100k a year. Even $20k in debt may not be worth it if you were going into a career that will never make you more than $30k a year…
By using the average numbers to calculate these statistics you are merely pointing out that a lot of college degrees are worthless and campuses have become overrun with kids who go for the experience, not for their career aspirations.
The average salary for an engineer or lawyer is much higher than $50K, thus the equation becomes much more lopsided in favor of college. A liberal arts degree with a salary closer to $40K, however, points out the problem of paying so much and getting so little in return.
NOT going to college might be financially detrimental. My employer will pick first from the pool of job applicants with advanced degrees (Masters) and experience. The person with only a college degree or high school diploma is at a disadvantage. Right or wrong, a advanced colllege degree is becoming the standard for job requirements. Perhaps the high school or college graduate can start their own business.
I think the industry you work in makes a very big difference, as well as the public vs. private route. After attending a private college for undergrad (thanks to generous scholarships) I chose to continue my education with a master’s degree. Living in New Jersey, I had several high priced options, several low cost public options, and Rutgers, which is public but in a higher bracket due to its higher status. As someone with a teaching certificate, I could pay $17,000 for my complete graduate tuition and see an increase in teacher salary between 5-10k a year on NJ teacher’s pay scales. My investment in my education would pay for itself in two to three years. And then I can reap the benefits for years to come, all without any student loans.
Jason-These are questions most families struggle with. These is no doubt that a college degree will help you (or your child) get a better job and earn more money. There is also no doubt that conventional college will cost over $56k (average in state tuition). It’s pretty hard to see the payback from such a large expense.
The key is to find ways to cut your college costs. There are several ways to do this: going to community college for your first two years, etc…A comment is too short a space to go into depth, but you can go to our website (or email me off line) to learn more.
I am totally in agreement with this article. I may not be a good example, because I pursued a Master’s in mathematics and have been fairly successful, BUT I did it without debt and because it was an area that I was passionate about and had good job prospects.
I have seen so many of my friends do degrees in psychology, sociology, or various Bible college degrees, etc, only to work in retail positions that don’t use their degrees in the slightest, or else go back to study a trade, incurring even more school costs. Or get an undergraduate degree in chemisty or physics, only to realize that in order to do any interesting/high-paying work, they would need to complete at least a Master’s, if not a Ph.D or even post-doc. If you weren’t planning ahead for that, it can seriously derail you financially and in terms of life stuff like marriage, children, etc.
I hope that when our kids get toward university age, we will be able to have realistic expectations. I have to admit that it will be very tough for my hubby (who also has a Master’s)and I not to have a heavy bias toward advanced university education.
This is such a touchy subject and the arguments for and against it are never cut and dry. I appreciate the article and think that the points made are pretty interesting and relevant.
On the one hand, I agree that kids that are not highly motivated to go to college straight out of high school should not be prodded to attend just because that’s the default logical step now. Not everyone fits that mold and not everyone wants what college has to offer.
On the other hand, if you take away the formal education, the career possibilities, and the expense, college is good, “safe,” environment for a kid to learn how to become an adult. Some could argue it’s worth the expense just for this.
Like another commenter mentioned though, that may be perfectly attainable without actually enrolling in classes and living on campus.
There are a thousand paths a person can follow walking out the door of their high school with a diploma. As much as I think college was a good experience for me, I think it’s unfortunate that we automatically herd everyone that direction.
This world takes all types and someone pushing a broom is just as valuable (or more so?) to society as someone pushing paper.
I’m not sold on the college degree thing as a financial tool, though I did just finish my degree a few months ago. I got my current job a couple of years before I graduated because I was highly motivated and had a long resume of experience outside of school. I volunteered a lot, held several important positions on various committees, and even ran public office when I was in undergrad. These are what got me my job, not the degree. I did decide to finish, because it makes a great insurance policy against job loss. If things went the wrong way at work right now, I know I’d have a better shot at getting a job in this sour job market having the degree than not. I think *that* is where the value of the degree comes, right now. The job market is so competitive here, the degree is what would get me in the door for an interview; my experience is what would (hopefully) land me the job.
I’d hate to think that my kids future could be determined by a math equation! But it’s understood that it’s just a very loose metric to aid in the overall decision.
But I think lost in the numbers, however we choose to count them, are the qualities that make up the personalities of those who choose to go to college or not.
For example, the percentage of kids going to college who come from the top 20% of households in both income and assets, is very high. Conversely the percentage of kids from the bottom 20% is very low.
The question needs to be asked, “what are the earnings potential of the kids coming out of the top 20% with or without college?” Just a guess, but probably pretty stinking good! That group would be likely to prosper what ever their education. Personally I’ve seen too many examples of this to believe otherwise.
Still another factor is motivation. A kid who can excel in a venue in which there’s no immediate income is demonstrating an ability to work for delayed gratification, which we know is a quality closely tied to long term success. But once again, is this a quality brought into college by the student, or introduced and trained by the college?
It may be that the success of the college grad primarily owes to the students background and own ethics. I’d say this is especially true once you get outside the majors that are likely to land the grad in a high paying field, like medicine in engineering.
Very interesting post – I love this kind of analysis.
A couple of points:
If you assume that a college degree will get you a “higher level” job then a lot of people would still do it even if the money doesn’t work out.
Assuming you have the ability and the knowledge that the education costs offset the increased income – would you rather be working for $978/week in a reasonably challenging job with a future or $591 in a lower-level less challenging job? I’ll take the better job.
Another factor which I think should be considered is that average wages for college/non-college workers shouldn’t be applied to any individual worker. Sure, a degree will usually help a worker to make more money but there are other traits (intelligence, work ethic, interpersonal skills) which will also work for or against a worker regardless of their education.
For example someone who is intelligent, hard working and has good people skills might do very well with a college degree but will probably do very well without one as well (if the profession allows it). In that case the average wages are not good wage estimates to use. That kind of person might have a much smaller gap in wages because of the college degree which of course would support the argument they should skip college even more.
Alternatively someone who doesn’t have a ton of ability won’t do as well as the previous example but if they can get through college – it might be very beneficial for them to get that degree since they might not have a whole lot of other things going for them.
As someone who is a faculty member at a public university, I fully support making higher education a priority for all who desire it. I truly love the pursuit of academic inquiry. HOWEVER…
A large number of our students are non-traditional (career-changers, adults, parents, work full time jobs, etc), but the bulk of our students are the traditional young adults going straight from high school. As a generalization, the non-traditional students work harder and are more appreciative of the responsibilities (academic and financial) that they take on while in school. They also tend to make decisions on majors based on long term career viability versus general interest. Probably because their life experience has given them some very practical life lessons.
Personally, I did the traditional route at a public university and a liberal arts degree which, while enriching me greatly as an individual, did not get me far in the career marketplace. Several years into my 30s, I went back for post-graduate work to a private institution and pursued a dream job (and accrued a lot of student loan debt).
As schools battle for enrollment, I have seen a general dumbing down of the curriculum and lower expectations set on the critical thinking skills of students. I advise several students who I wish that I could talk to about leaving academics and pursuing a trade. I do believe that there are folks who would feel more fulfilled and do better financially in positions that do not require a college degree in the trades. But I am expected to keep enrollment a priority and keep these kids enrolled in school just barely passing a general liberal arts program. I am becoming convinced that as colleges and universities move towards operating under business models rather than as non-profits the quality of the education deteriorates and the consumers (students) get less for their money.
All to say, making a high quality education should be a priority in our society. The consumer should beware – there are times when you do get what you pay for and there are times when you may be getting swindled.
I think it’s interesting and useful to look at the “value” of a college education from this angle – whether it will literally pay off in the future. However, it completely overlooks why many people choose to go to college in the first place – not because it will help them make more money, but because higher education is inherently valuable, in ways that cannot be measured in dollars and cents.
Disclaimer: This is admittedly a very privileged position. And I am grateful that I have the ability to take it.
I come from a middle-middle class family and my parents have never been very good with financial planning (which I’m only now realizing as an adult), so I didn’t have any college fund. But I received an excellent merit/need-based scholarship to a very selective, small, liberal arts school. My parents paid what they could, and I’m incredibly grateful and privileged for that, and I took out loans to cover the rest. (I’m about 20k in the hole.)
Is it worth the debt? Absolutely. But not because of the better career or salary I’ll hopefully have because of it. It was worth it because I value learning, I value intellectual stimulation, I value being among peers and professors who can provoke and inspire me.
For me, because of my values, this cannot and should not be measured in dollars. I simply cannot imagine my life without having had my college experience. It’s (almost) like talking about the financial implications of a marriage – judging it’s “value” in terms of long-term financial pay-off. It’s simply not about that. It’s much more important than that.
Some issues with this article:
1) Jason, in one part you cite the personal savings rate statistic as evidence of a lack of savings by Americans. From that same article, I explained how the personal savings rate actually doesn’t measure savings. Be careful in how you use it.
2) Jason’s methodology of evaluating the worthiness of college majors treats all as identical in terms of earnings. That’s simply not true, nor a fair way to assess whether college is right or wrong for someone. It should be “Go to college to get a degree in X vs. Not”
3) While the value of a college degree has been diluted in the last few decades (McDonald’s managers now need them), not having a degree carries not only a monetary difference but also a social difference, which can affect monetary issues 20 years down the road.
While it is always good to think about your next best use of money/time, this article I think would lead some folks who are at the margin deciding between college and not with the wrong impression.
@ Anonymous – Thanks for sharing. I just finished reading a book called “Ahead of the Curve”, by a journalist who pursued an MBA from Harvard Business School. In it, he recounted a conversation between a student and a school administrator in which the student was complaining about the treatment he was receiving. “I’m your customer” he said. “How can you treat me this way?”. The administrator replied that the student wasn’t the customer, he was the product.
I found that very illuminating in light of my experiences with my MBA from a well-respected school. Do you find that mentality existing at all universities? I’d be curious to hear your experiences.
I wouldn’t evaluate the benefits of college just on a potential earnings basis.
There is a lot that can be learned about life and a lot of connections that can be made in college. Not only that, but even if you don’t end up making a lot more money, the odds are good you’ll be doing work that is more fulfilling and/or at least more challenging.
Though, I would agree that the case can be made against college if your kids already know what they want to do and have a path to get there and/or are entrepreneurs.
The point about paying “sticker price” is always overlooked in these analyses. I went to a private college for undergrad and tuition + R&B was $98,000 over the four years I was there. But my ACTUAL cost was only $34,000 – barely a third of the price tag. Add in the fact that only a quarter of my costs were student loans, and only half of that loan balance accrued interest while I was in school, and I think it comes out way ahead of the person who didn’t go to college.
Well, I’m a little too far in to back out now, over half-way done with half the debt load… I’m getting that freaking degree!! 😛
That, and my degree should allow me to go and test for the CFP designation. After that… Well, I can go work for somebody or work for myself. I plan to do some of both, moving more towards working for myself as I gain experience and network.
I’m hoping that the $50k investment won’t be a waste, but I’m hoping to earn that much in two years of solid, good work. Since I don’t already have a strong entrepreneurial bend, I’m working on that, too. But college is definitely a tough job… I’m just ready to earn my degree and get out. (I ended up taking a year’s break to get my ducks in row, doing a *tiny* bit of traveling, moving and getting married, so I’m a bit behind everyone else my age.)
I am in full agreement with Eden Jaeger here. The education I received while earning my Bachelor’s degree last year, while not related to the work I am now performing has aided me in many other aspects of my life and may yet land me a related job.
Going into college I was the most introverted person I have known and was in a state of great depression that had been keeping me shut up in my bedroom nearly 24/7. Through having to give individual and group presentations in front of the class, being required to participate in seminar or discussion groups, and with my found knack for foreign languages, I found myself.
Being competent in several languages is a marketable skill and it’s one I may never have found in the world of paid employment. I have also become much more willing and able to share my own thoughts in conversations and have made friendships and business accquaintances that I would have otherwise been to shy to approach.
Barry: Would you have had the same opportunities if you weren’t enrolled in college? Would you have been on those committees if you were working full-time trying to make ends meet?
I will never discount my college years, just because of the doors it opened for me. Granted, it takes a motivated person to walk through those doors.
I think it all comes down the individual and the importance put on education while growing up.
For those who are arguing that one should only go into debt for certain majors, etc., do you know which majors earn the most? There’s an inherent assumption here that “liberal arts” (presumably, humanities) graduates don’t earn money, but that law school graduates do. But, of course, you can’t major in “law” or “medicine” as an undergraduate in US universities. And guess what? Most law school graduates majored in a humanities-related field. Similarly, the trend in medical school admissions is toward humanities majors who have taken the requisite science courses. That’s mainly because they realize that applied knowledge is always changing. Think of the leaps and bounds made in technology recently. If you only took classes to teach you BASIC programming in college, you would be in deep trouble now, since it is a completely irrelevant programming language. Trying to anticipate the trends of the economy and job market is as difficult as anticipating the stock market.
One of the biggest mistakes I see my students and their parents make is trying to game the degree market and pick what they think will be the most profitable degree. This almost invariably leads them to settle on a business major, which is one of the most oversupplied and undervalued fields today. I try to encourage my students to major in what they want. They will be much better positioned for the job market by doing exceptionally well in school, and they will be most likely to do well in school if they take classes they enjoy.
For some reason, people ignore the fact that few employers make hiring decisions based primarily on a recent grad’s major. But think about it: in how many job interviews have you been asked about the *classes* you took in college or the specifics of your major? Instead, most employers look at what school the applicant went to, how well s/he did, and any relevant experience the applicant has (which is almost evaluated via on-the-job training, like internships, and not classroom curriculum). Almost everyone knows that most of what ends up being valuable about an employee is learned on the job. Employers are looking for smart, trainable people, not a major.
I know some will dismiss this as touchie-feelie, especially considering the anti-college vibe (again, anti-college when it comes to everyone *else’s* kids–I doubt anyone here is cashing out their 529 today), but the value of going to college is in learning how to think well and articulate what one thinks. Indeed, that can be learned at a variety of schools and through a variety of majors. I can’t urge you enough to let your kids study what they want. If you’re going to put pressure on them, put pressure on them to take it seriously, work hard, and to get connected. An Art History major who has a 4.0 and worked compelling internship is imminently more employable than a business major with a 2.5 GPA who took summers off.
I have a strong belief that a college degree is a critical component to financial success since we know that college graduates earn more income than their non-graduate peers. It is a type of filter for future employers that begins when the student completes the eleventh grade. I would argue however, that the reasons that motive people to attain their college diploma are the reasons they are more successful and not because of the diploma.
I agree that college isn’t for everyone, but think it is a serious mistake to evaluate the value of going to college primarily on the basis of earnings potential. A liberal arts education gives students an opportunity to engage life’s biggest questions, to sort through their own values, and to hone their skills as critical thinkers. Regardless of what career you end up in, there is inherent value in learning to appreciate the arts and fine literature and in understanding the basic framework that informs the natural and social sciences. The dollar is not the measure of all value.
I think ethel (#31) is really hitting on the keys here. For the person who just wants to show up, party, and barely survive with a degree in hand, the investment is more likely to become a poor one. For the person who takes it seriously, and actually tries to learn and get to know like-minded folks, the investment is likely to pay huge dividends.
I’m assuming that costs and debt are minimized whenever possible though. Starting your career with a $100K debt load isn’t going to set you up for success any time soon.
I appreciate the math background behind this and how the difference of four years in the beginning can really make a difference.
However, I guess I’d definitely stress to folks the importance of how this may not work for you — many people can’t even get the job they want without going to school (in particular my wife and I, she’s in med school and I’m in grad school for engineering — we’re going to ‘start’ life with hundreds of thousands of dollars in debt!)
But still, the conclusion is surprising that college grads may not come out as far ahead! However, both results hinge on people being wise stewards of their money and SAVING. Something that I didn’t think I wouldn’t know right after high school, let alone right after college.
Money isn’t everything- you have to consider your ultimate satisfaction with your career- maybe you can make a great living without a college degree, and maybe you’ll be very happy without that degree. But maybe not- maybe you want to spend your life in a field that requires a degree, even if your pay is the same. Also, it seems that good paying jobs without a college degree requirement are increasingly more difficult to find. There is something to be said for job stability. I agree that college isn’t for everyone, but the economics of the situation aren’t the only factor.
Hi there J.D. —
Seems to me that Jason is a really strong contender for that new post at Get Rich Slowly with this entry. His writing demonstrates a depth of inquiry, willingness to question conventional wisdom, and ability to “crunch the numbers” that will make him a valuable commentator on personal finance issues. Thanks for this piece! Monique Tilford, Co-author, Your Money or Your Life
I have 110k in debt from a great school. I am still struggling though. It will be worth it depending on what field I go into.
I believe Jason’s comment at #14 nicely sums up the basis of his entire article. I do not believe he is being anti-post secondary education, he is simply getting people to look at both sides of the scenario; to broaden their horizons. Let’s face it: forcing kids to go to university for reasons other than their own desires and rack up thousands of dollars of debt, meanwhile a certain portion drop out, another portion don’t even get into their field, and a large amount are left with horrendous student loan debt requiring them to live like college students for years afterwards is not a pleasant thought, and is certainly NOT a positive way to start out young adulthood for those individuals.
Post-secondary education does infact open up more doors in regards to employment, but if it doesn’t fulfill the individual and they detest what they do, it simply isn’t worthwhile. It is all about following your desires, your dreams, and your aspirations. Being a senior psychology/ sociology double major I have seen many a student leave the field to pursue other endeavours. While I wince at the student debt some may have accumulated, I realize what suits some does not suit everybody. It all depends on YOU and what YOU want. Nice article.
PS. I have to second commentary #10: I find it odd that the last potential GRS writer that mentioned college was so heavily critised, yet this one is not? I personally think both are good 🙂
My daughter went to college right out of high school just because that’s what everyone did, and I paid for most of her expenses. After a semester of straight Fs, that was it for both of us. Fast forward through 7 years of low-paying jobs and a stint in the military (no school benefit), she’s back in school on her dime and with a goal and plan of what she wants to do. My plan is to help her after she gets out by paying off some of her loans (she doesn’t know this).
I’ll encourage my son (and future children) to either 1) try community college for a year or 2 as a cheaper route or 2) take off a year or 2 (or more) to work and see if college is really for them, rather than making it the default choice out of high school.
Also, I feel that 6% tuition growth is unsustainable. At some point, college will just become too costly for what you get. We’ll see a return to the trades and other fields that don’t require a college degree. The previous staff writer audition mentioned having $100k in student loan debt – and might take 20 years to pay it off. That’s no way to live – even if he did go to his “dream school”.
I agree that strictly financially speaking, college doesn’t make sense for everyone; but,
It should always be pointed out when having this discussion that college isn’t only about the degree you get and the salary that degree generates. It’s also about the immeasurable life lessons you learn. Socializing with others, learning to live with others, experiencing diversity (especially important for those from rural areas), networking, budgeting, etc.
These are skills that benefit anyone, no matter what they decide to do upon graduating.
Personally, my degrees have benefited me greatly from a financial standpoint. But it’s the life lessons I learned at college that I could never put a price tag on. I think everyone deserves to have those experiences. Having a degree never hurt anybody. Not having one has hurt many.
Another problem is it’s next to impossible to determine whether or not college makes sense financially for a child after high school graduation. In my opinion, better to error on the side of caution, a college degree being the side of caution.
My college degree was the biggest waste of time and money! And no, I did not just coast through college, I applied myself, worked hard, and went to a highly respectable public school that was supposed to be a leader in my major.
Then I graduated, and found out that my degree was absolutely 100% worthless.
Boo college.
Wow, way to post a controversial topic as your first. I am very pro-college, so it rubs me the wrong way a bit. With that being said, I have respect for you hitting it hard and heavy – and posting it in a (at least decently…) analytical way. Don’t get me wrong, I like “How to find coupons in your area” posts, but this one makes you really think.
Good…
I like the way you looked at it from an investment point of view. Run the numbers and see if the choice is warranted or not. Even on things like college, this step is a must. I personally would recommend college to everyone who could afford it, simply for the great experience, greater knowledge, and better earning potential and job security. If you cannot afford it however, and do not plan on going into a field that is secure and gives a good wage – then it’s probably not the best decision.
Bad…
I dislike your citation of “Parkinson’s Second Law”. It’s true, but not nearly enough to discount the 1.7 million dollars difference between the two earning potentials. Sure, a good amount of that will go to perishables, clothing, nicer cars, etc. But a good portion of that will increase your standard of living and your net worth. Furthermore, I believe that if you took the savings percentage of those with a college degree versus those who do not, I believe the percentage would be much higher with those who have a degree. Thus, your base numbers would be skewed. I say this because of the following idea. If you were earning just enough to have the things you need, your savings percentage would be nil, and you would bring down the national average.
More of my 2 cents…
The biggest thing when going to college, is to research your potential field. What is the average wage out of college, 5, 10, 15 years from now? How about job security? Is it projected to grow? Decline? If you are taking on 100k in debt without a substantial increase in job security and wage – it may not be the best move.
This article may have an interesting point to make, but it’s drastically and I can only assume deliberately misleading. Not only is the savings rate likely to be much higher for college educated people than for high school graduates, but it’s pretty stupid to act as if the only benefit of going to college is a potential increase in the size of your retirement fund. Maybe your kid likes the idea of having higher expenses, which usually translates into a higher standard of living?
I liked the way Jason approached this article, but I think he missed a couple of points: most importantly, what if you want to make MORE than an average income? A BA may open many doors to earning big money, especially in industries like finance. With a high school degree, unless you’re an enterprising entrepreneur, it’s going to be difficult to get beyond the average.
Also, white-collar jobs are considered by many to be easier and more pleasant than blue-collar. The amount of money you earn isn’t all that matters– how difficult or painful it is for you to earn it is also important!
I’m not saying I think that everyone should go for a college degree! I just wanted to point out some points that I think are very relevant.
I heartily disagree with your conclusion about how a lump-sum transfer of money can somehow “equalize” the financial outcomes of high school vs college grads. Most of my comments have already been discussed above but I’ll add my take:
1) Jason, you discussed average wages and didn’t take into account the distribution of wages. What I mean is this: what if the college graduate had a greater chance of earning big bucks? Even if the average wages were the same for HS vs college grads, I’d want my child to have a “lottery ticket” for future earnings.
2) I also want to add that social pressure, which can be good or bad, determines a lot of financial outcomes. A key example is marriage, which we all know is a big wildcard in anyone’s financial future. Does anyone here read “Dear Abby”? How many times does a parent or sibling write in about a loved one who is “mismatched” by marrying or dating someone who lacks a college degree? I’m not saying that this judgment is good or bad. Yet, as colleges also educate their students to think analytically, delay rewards, and rise in the marriage market. Something similar can be said for friends and colleagues.
-Jean
I don’t think this is a very compelling article. The point of going to college isn’t to “raise your average earning potential.” Would anyone actually take this risk with their own child?
I think it’s an important developmental milestone because the student is learning to act a little bit more like an adult. For all the stories of frat parties and binge drinking, going to college is often a time of huge development for many people in the areas of personal interaction, responsibility, and (if you take the right courses) learning how to think analytically.
Is college the only place this can occur? ‘Course not. You’ll get all this stuff in spades if you skip college and learn a trade, or go into business for yourself. College is just a bit of a halfway-house for this, so to speak. It makes the transition a little easier.
Is it worth the enormous investment of time and resources? That’s up to you (and your kids).
Well, I got a college degree, went into debt with student loans, and my job barely pays me more than my wife. My wife didn’t go to college, she works at Starbucks and makes nearly as much as I do! In fact, in a couple of months I’ll make less than her, and I have a 4 year degree in a competitive field, and living a fairly big city!
I regret ever going to college, Now I’m in debt and broke.
College gave ME NOTHING!
Great post–I recently graduated from a public, four-year university in Ohio in May, fortunately debt-free. My degree is in a field I am no longer interested in, so I am going to have to go to grad school to advance in my newly chosen field. My fiance had a year left before he would have earned his BA in English Creative Writing. But he dropped out in May–claiming that he was bored and restless and that college was never for him. This summer he enrolled in an EMT-B class at the local tech school and has, for the first time, actually cared about his studies! He’s about to enroll in nursing school in September, with dreams of becoming an RN/paramedic on a careflight team. Had he continued on the four year path, he would have had a degree but no passion and no tools to do what he really wanted to do: help people in medical emergencies. He faced a lot of criticism for his decision, but he is a prime example that college isn’t for everybody and college isn’t the only avenue for success.
#51 Sir Jorge:
You see,
That’s why Jason stresses that post-secondary education ISN’T for everyone and the decision to take out student loans and attend an institution shouldn’t be taken lightly or forcefully. I, for one, view my University education as a “Positive Educated Gamble” this means that my odds of obtaining higher paying employment are increased, but like everything else in life, NOTHING is GUARANTEED. Thus, it’s a gamble with an advantage.
Mid-way through my second year I began paying back my student loans ALREADY as well as working to cover my current tuition because I simply don’t want to take the chance of ending up both unemployed AND in debt no matter for what duration of time it lasts. I also have a PLAN B, which I feel most young people should consider: “if this field of study doesn’t work out for me or I don’t gain immediate employment, what are my alternatives? What other skills can I utlize to my advantage in order to create income in the mean time?” The way I see it, stack life’s chips in YOUR FAVOR 😉
Sorry Jason, but you don’t have my vote for GRS.
Let me declare before hand that you lost my attention in less than 10 seconds. Two words: Half-truths.
Rising costs every year? Tuition of 109 828$? Yeah right. Sound more like a sales pitch from some shady bank salesperson. Where’s the critical thinking.
Public school financing doesn’t work like that. Do you really think that the public would accept such tuition fees to achieve a professional opportunity and a relative financial stability through income? Political backlash would be much more possible. Double-check your information.
Good luck with your blog.
Jason,
Great column. Those are some shocking figures.
I strongly disagree with this analysis.
By assuming a constant savings rate of 5% for both the college grad and the high school grad, and ignoring all other factors, you’re effectively reducing the difference in degrees to the difference in their savings rates, which by your weekly-paycheck numbers is about $1000 per year. Naturally, if you assume that college costs $30k-$100k and earns you an extra $1k of retirement funds per year, college is going to look bad even without considering four years of opportunity cost.
Problems with approaching the question this way:
1. Ignores higher potential for job satisfaction.
2. Ignores value of higher standard of living.
3. Ignores disparaties in the savings rate; a 5% assumed savings rate does not apply to people who can barely make ends meet.
4. Ignores the disparate value of different majors.
5. Here’s a big one: you assume that the high school grad, having gotten a transfer of a huge sum of money, will save 100% of it instead of 5%. Why is this true?
All of the intangibles of the college experience should matter when deciding whether to go or not. However, the purpose of this article is an economic thought experiment, and I think the ideas need to be evaluated within this framework.
This said, I find this analysis to be a gross oversimplification that is both superficial and misleading. If one is to do a cost benefit analysis of the economics of attending university, the following need to be evaluated:
i.) does attending university increase the likelihood of having a job with benefits or a retirement plan? If so, this needs to be costed in
ii.) does attending university decrease the likelihood that one will have a physically dangerous job? If so, non-university wages need to be adjusted to take into account the probability that employees will be injured and lose income
iii.) are there differences in the college grad versus high school grad employment rates? Unemployed people (as far as I know) do not influence formal estimates of wages, but in practical terms, salaries need to be weighted by the possibility of unemployment needs
iv.) relatedly, do college grads experience more job stability? Are they less “disposable” to employers than a high school grad? If so, then again, these periods of unexpected unemployment need to be added to the model
v.) does going to college influence the earning potential of your spouse? People tend to marry people of a similar level of education. All else being equal, a degree should net you a spouse with more education, thus producing higher combined income.
Finally, there are a ton of intangibles that others above have addressed. To add to these (briefly), there is a definate quality of life issue here. Well-being research shows that income does not really predict well being… except for the first 30k or so that someone earns. The mean income for high school grads is right around 30k and you can bet that the median income is lower than the mean in this case. Thus, in this circumstance you would be taking a real gamble that your kids income would influence their well being. There are also other variables that are influenced by education (vacation time, job stability etc.) that exert an independent effect on subjective well being.
All of this being said, I think it is important for students to have a goal, articulate that goal and select a program that is a means to that end. Along the way, college will produce other benefits that are an end to themselves, but when picking a program it is crucial that it is done with an eye on the future.
Also, I would strongly suggest that students consider skilled trades programs offered by community colleges or carefully consider the employment prospects for university degrees. Finally, for most jobs the quality of the school may not matter as much as people think. For med school, yes, but if you want to be regional manager of the widget factory, a highly ranked public school is probably equally good to a private school.
I do think this was post was better than the last one by this writer. However, while the college-no college debate is interesting, the post did not “wow” me.
I keep thinking back to J.D.’s recent GRS survey. Results showed that the average GRS reader is a 31-year old woman with an average income of ~$72K (can’t remember the exact number). The two topics most interesting to readers (or at least survey takers) are DIY and frugality. I think all of the above should be kept in mind as the guest writer is selected.
College is over-rated.
Who you know, and how valuable your skills are in the real world is what gets you a good job, not college.
I graduated from a 4-year college with Honors, with a BFA in graphic design. I bounced from low-paying design job to low-paying design job, but was never able to find a good-paying decent job (and the design companies kept folding under me, especially during the dot com boom/bust). I’ve been unemployed in my field for over 4 years now, and doing graphic freelance and working a part-time retail job to scrape by. I have a net income of around 12,000 a year.
My roommate never went to college, nor had schooling outside of high-school. He is a naturally gifted brilliant programmer/computer engineer. He also had the right connections, and earns close to 6 figures at his job, as well as having full benefits and a lot of perks.
My little brother has a college degree (general business), but he took 6 years of partying to get it and graduated with low grades. He has a huge network of friends however, and managed to land a real estate job with a posh company who moved him to Hawaii (all this while the recession was going on!) and is paying him a decent salary. My brother got this job only because of his connections.
So the moral of the story is that college doesn’t seem to matter. It’s all who you know, and if your skill set is actually valued in society (ie, computer engineers are valued since they are rare; graphic designers are not valued since they are common and not needed).
@ #54 Eric
Yes, rising costs *every* year. I work at a major public university and we calculate a 9% yearly increase in tuition.
I’m a financial advisor and have been through life just like everyone else. I agree with the point that not going to college and getting a smaller wage in the beginning can be beneficial if you save that money. The problem is that most young adults don’t know this. Another thing that I would like to express is that compounding interest is really not what it seems. You need to educate yourself more to get a better rate of return. Yea…you may get a great rate of return of 8%. Then you need to take out the average inflation of about 3% to get 5%. Then if it is in a taxed account, then you need to take an additional apx. 25% off earnings. The true and only way of increasing your wealth is to increase your salary. It’s the most dramatic change and the most beneficial. Don’t get me wrong. I’m sacrificing a lot since I’m young to save, but I also know that my salary per year is the most important personal finance target. I hope you all agree!
Brenda, you are arguing against statistics using anecdotes. However your point about your little brother is interesting. Did he meet these friends in college? Weak ties (casual acquaintances and most friends not in our core group) are how we find out about most opportunities. College is an excellent chance to meet other people with access to potential job leads. Regardless of whether he found work through merit, if the connection to his job was from friends he met at college, his story would argue for the wisdom of investing in a college degree.
I dislike seeing this purely from a financial view. College may not have actually lead me to my current work but it gave me so much more than that. Should we really judge everything by how much money it earns us? That’s just sad.
My husband didn’t graduate from college but makes twice as much as I do. I have a Ph.D. but can’t find a job in my field and work in an office for a lot less money.
Fine. That’s okay. I learned a lot from college, had a great time, might be able to work in my field later, and didn’t come out of it with student debt (just a lot less in earnings during the years I was in school–we relied on his income for those years and I brought in enough to cover school expenses but not a lot else).
College is not for everyone (and honestly, a Ph.D. is a horrible idea for most people–my B.A. and M.A. were great fun but my Ph.D. was misery! Don’t go for the Ph.D. unless you have to, believe me!).
However, judging college purely on finances! Ridiculous!
After 20+ years working without a college degree in fields where everybody else has one. I can tell you, that while the degree does not necessarily increase your income, it does increase your opportunities. Last year I had to do a job search because the contract I was working was ending. I had the hardest time getting interviews for jobs I was well qualified for because I couldn’t get my resume past the filters on the job web sites. The sites didn’t care what your degree was in or where it was from. All they cared is if you have one. If you can, get a degree. You may not get more money in the end, but at least you won’t have your opportunities limited by a check box.
Jesse (#62)
He found the core group of his friends in High School (we grew up in a small town), and most of the rest were found in beach-side bars where he’d party. Had he not gone to college, the vast majority of his friends would be the same.
And the three examples I gave are merely a small fraction of the people I’ve heard of who’ve gotten jobs solely on “who they know”. Sure, it’s all anecdotes, but it’s what I know.
I’m not saying that one should never go to college. I just said it was over-rated. Just because you have a college degree doesn’t mean you’ll get a good job. Thinking that is so, will be a recipe for disaster in some cases. (And yes, I have several friends who are in the same boat as me: college-educated, older adults, who are working retail because they simply cannot find work in their field and lack the connections and great social skills to shmooze their way into a great job).
Well I didn’t think the article was that great but the discussion that follows it is excellent! That must say something for the writer.
My parents paid for my first college degree. It was a priority for them personally and they saved for it. They let me go where I wanted, and study whatever I wanted. While I did get a job in my major, and ultimately made decent money, it was not a field that cares about your education. I was fortunate that my school provided the hands-on practice that my employers were interested in, but the true value of college for me was learning how to live on my own, make my own decisions, and live with them. I am eternally grateful to my parents for giving me that opportunity.
I burnt out on that field after 4 years. While temping and trying out a variety of jobs, I got a completely useless masters degree. The subject fascinated me and I enjoyed my classes thoroughly. I loved being surrounded by students who were passionate about learning the material, and not interested in screwing around. I got a subsidized loan with a 10-yr repayment period and a disgustingly low interest rate. I will never work in that field, but every month when I make my student loan payment, I still consider it a great value.
I am now embarking on education once again. Via temping and working for friends I found a field I am good at and could be happy in. My employer will pay for my education as long as I make B’s or better. It will take a long time and be a lot of work, but it will keep me employable in the long run – this is a field that does consider your degree and education. Being free, it can’t help but be a good financial value, but I think it will prove to be worth my time and hard work as well.
Even given all that, I will still agree that college is not for everyone. I am a person who thrives in that setting, but for those who are more aimless, or more driven, or more practical, another route might be more valuable: community college, or trade school, or starting a business. The hard part is knowing (especially at 18!!) what is right for you.
Thanks everyone for a great discussion!
I’m sorry but this is an extremely week analysis of these two options. One large, glaring weakness is the assumption of the wage inflation. As a college graduate, I know that my earnings will increase with experience at a much faster clip than the 3% inflation assumed. How many people get out of college, get a job, and stay in that position for the nest 40 years?
An analysis that would have been beneficial here, is comparison between the rate at which salaries increase for people with a high school diploma, college graduate, and masters grad.
To me, the biggest issue with this article is the assumption that the college grad’s salary will only rise at the rate of inflation over the years. For the high school grad, this is a lot more likely. Many jobs available to high school grads have ceilings that one would need to be exceptionally talented to break through. However, the average college grad enters a career where there are promotion possibilities, and promotion is not only possible but expected. Therefore, the salary will increase substantially more over the lifetime of the average college grad than the average high school grad. Of course there are exceptions to every statement like this, but I think in general this is true.
This article is only relevant to liberal arts majors and only those that aren’t planning on becoming lawyer/doctor. Everyone in the sciences/math/engineering fields needs a college degree. Even though it’s more of a congrats you passed type diploma you are taught many things you didn’t know in high school.
Let’s not forget that College is where one learns to hold their liquor. That is a skill for which no valuation can sufficiently account. 🙂
I have to concur with what my namesake commented at comment #42, the rate of increase in college costs is unsustainable.
10-15 years ago young people were graduating with $20–$30k in student loans, now $50-$100k is no longer unusual. How far can this go? Will it be $150-$200k in another 10-15 years? Will it still be worth it then?
Jason’s analysis based on the numbers may be a foretaste of what is to come.
We also have to ask, what are the alternatives? Some of the trades are now outearning college norm jobs, and at far lower up front costs because so few are entering them.
Meanwhile, back in the 60s and 70s a college degree was almost an automatic pass into the upper income ranges, that’s no longer the case in many fields.
This will be a tougher choice going forward…
I think a college degree has far less to do with earning potential than the statistics would indicate. Sure, the average college graduate earns more than the average person who never went to college, but that leaves a *lot* out of the equation.
People come from different socioeconomic backgrounds, and this influences their ability to go to college, but also their ability to fit into the class of people that have college available to them almost as a foregone conclusion. Take four people as a test case:
1) The child of an upper-middle class family. Parents were a doctor and an engineer. Goes to college at 18, graduates with a degree in History.
2) The second child of the above couple. Graduates from high school, goes to college at 18, majors in computer science, does well, but drops out at 20 after being enticed away by a software startup company who thought who was just too good not to purse as an employee.
3) The child of a single mother grew up on welfare. Lived in an urban ghetto. Growing up, the people he knew that were “successful” had full time jobs unloading container ships down at the docks. His less-successful acquaintances tended to end up in jail on gang-violence related issues.
4) A child that grew up in a similar situation to child number 3, except through a bit of luck and some harder work in school, he ended up going to a four year university and getting a business degree.
Who do you think, of these four people, is mostly likely to earn the highest income? Do you really think that the presence or lack of a degree is the highest correlating factor with the success of these four individuals?
The opportunities available to us are often limited more by our knowledge and perception than by any real-world limitation. For example, I personally wold be absolutely comfortable applying for senior engineering jobs at Google or Microsoft. This is the world that I live in, and the pool of jobs I’d draw from if I was currently job hunting. However, I would have *absolutely no idea* how to even apply for a job unloading cargo ships down at the docks. I wouldn’t even know what to find the name of a company that employs people to do this. In my examples above, the third and fourth individuals would grow up far more comfortable with this sort of job-hunting than the first two individuals, who would be more accustomed to the type of job-search I’m comfortable with. Individual number four, who managed to get out of the ghetto and earn a degree, may still find it much easier to fall back to his roots when looking for a job, and even if college made him much more comfortable with the idea of applying for upper-class jobs, he still may be much more nervous going into job interviews with his own background rather than the background of someone who expects to be able to land this sort of job.
College correlates well with having been raised in a middle or upper-middle class family, and I have a feeling that salary also correlates well with the sort of environment in which you were raised, maybe nearly as strong as it does with a college degree. I’d also guess that college dropouts — people who had the opportunity to go to college, started and for whatever reason didn’t finish, probably make *significantly* higher salaries than those who never had an opportunity to go, simply because they come from backgrounds where the sort of jobs they’d think of looking for — the jobs their parents held — are higher paying jobs than those available to people who could never have even considered college.
College is useful, but it’s not the only indicator of what salary you may or may not make. It’s also not the only way to get a job, nor even the best way, probably. Experience has always and probably will always matter more than a degree in “practical” fields like engineering and construction, and I can’t imagine any company in these areas seriously rejecting an applicant with 10 years of experience and an exemplary record in favor of a new college grad with a good GPA, unless they’re specifically looking to hire someone cheaper for a lower-tier position. You notice this especially in very high-end positions — when you read about a new CEO taking over at a company that’s been struggling, do the newspapers tell you where he went to school? Probably not, but they do tell you his previous positions were CFO of Wal-Mart and executive VP at Coca-Cola. Your degree no longer matters at all by the time you reach this level, although it may be difficult to get past the first few rungs on the ladder up to this level without one. But, if you do manage to make it past the first few years of a promising career without a degree, it’s less and less likely that going back and getting it will prove particularly useful in a financial sense.
Note that this whole post is biased by my position as the son of small-business owners, and a salaried employee as a software engineer in the silicon valley. It’s probably wrong when applied to significantly different fields, like those in academia.
I agree for many people, there are better financial alternatives than going to college. I know a guy who studied broadcast journalism that’s a carpenter, a guy who majored in English that owns his own painting company, people who majored in marketing that work at Best Buy, etc. None of those people needed to go to college to do what they do. Ask them if they wish they hadn’t. Ask them if they wish they had crunched the numbers and gone directly into their current field. I’d be surprised if that were the case.
I’m an attorney. Lots of days I wish I had chosen something different to do with my life. I never wish I hadn’t gone to college. It has nothing to do with money. Getting a formal education has value above and beyond that to me. That being said, I know several people that went to college that are well suited to be electricians or auto mechanics. They still may end up there. Going to a university can be a poor financial decision, but it also acts as an unparalelled exercise in self-discovery.
As someone mentioned above, I think it might be best for someone else’s kids;) Good post.
This was a great topic to discuss! As many others have mentioned, college is no longer reserved for an elite and motivated group of high school graduates. Everyone is more or less expected to attend college. Because so many 20-somethings have a degree, finding a job is more difficult and competitive. This leaves new grads fighting for job openings. So it’s basically left up to luck. Your future and the value of your degree is determined by employers!
We have ourselves a little commentroversy brewing in which many commenters are, it seems to me, deliberately not getting the point that the author was making, which is that every individual is going to have a different motivation for and/or response to higher education and that one should consider it as an investment, as well as for all of its other potential benefits.
The type of higher education you choose is extremely important to your longterm financial well-being. If you are determined to study literature, you had better be a stellar high-school graduate and be willing to take on all necessary debt, because the only way to make a living in literature is in academia and you’d better have a top degree – and you’ll need a Ph.D., so we’re talking 8 to 10 years of study.
If what you really love is customizing cars, though, then vo-tech is the way to go – you can learn all the mechanical, electrical, metalworking, drafting, and design skills for a fraction of the cost of a university degree, and
earn a very good living. Maybe even get your own cable show.
I am one of countless liberal-arts majors now working random office jobs. I needed a BA to be considered for my first legal support job. It paid $13K and I worked in the file room. I had all the skills I needed for that job at sixteen, but couldn’t have gotten it without the BA.
Unfortunately, the BA didn’t provide anything except for that open door. It’s hasn’t been worth a dime to me since, and I wish I’d studied something else.
So yes, that degree is an investment and it should be investigated objectively just like any other investment.
There is a daunting number of comments, so I’m sure I’m not the only one to say this, but the argument presented here seems worthless to me. What you’re saying might be true, maybe college isn’t always the best investment, but it’s not about numbers… going to college is the social norm. Unless he’s running his own successful business or working at a unusually good job, it’s just not socially acceptable for an 18 year old to hang out in his parents’ home waiting for the years to go by so the investments they made for him can grow. As all his friends from high school go off to college he will resent that his parents made this choice for him because they ran some hypothetical numbers when he was an infant.
“Rich or poor, thrifty or not, the current savings rate as of the end of May for Americans was only 6.9%.”
Are we actually supposed to believe that the savings rate does not vary with income levels?
Personally, I really like the style of this author. He is able to write both personal stories and more heavy-hitting financial analyst. Maybe this article isn’t for everyone, but Jason’s flexibility in topics and style would be great for this site.
I do think some people did not get the whole point of the article, which was not say if you should or should not go to college, but rather to encourage everyone to look at the financial side of college as an investment. He is not saying college decisions should be purely financial, but rather it should be at least including in your decisions and that college might not the end all answer to everyone.
Just by the fact that Jason is saving for his son’s college tells us that he does consider college important as long as it is the right thing for his son when he gets to that stage.
I consider myself successful without a college degree. There are too many resources out there today for you to become self-educated in anything and everything. Nothing takes the place of common sense and street smarts.
Another thought-provoking article, but this time with a different set of parameters and lots of nuts ‘n bolts statistics.
Obviously, by the comments, the author has stirred something in all of us. Another factor can weigh in, such as if the person’s career is truncated through unavoidable circumstances. Then the CD’s would be more than welcome. Of course, we don’t know what the future holds, but as Jason’s article might suggest, it is wise to look at all the facts, figures and future dreams with a dash of practicality.
Keep writing! I’m not usually interested in finance, having little personally, but I find your topics and style to be excellent–draws a person into the discussion, obviously by the number of comments here.
It’s nauseating that so many advisor type people in the college guidance offices dismiss financial concerns by syaing your after college job will more than cover the debt. It’s a load of ****.
I made a third of what the college councilor had told me – man was that a wake up call. 7 years later, I’ve paid off 20% with out really trying. If I sign up for some college classes & don’t “have” to make a pymt, I still make the pymts since it’ll ding the balance more with no interest accruing. I think I’ve probably taken about a years worth of college classes since graduating in order to broaden myself & qualify for different jobs and I don’t regret my degree or the additional classes. My degree allowed me, a single Mom, to move into a male dominated field. It allowed me to learn some skills that have saved my life (electrical classes).
Feeling like I’m pigeon holed now though & I’m debating getting an accounting degree just to get my foot in the door in other areas. I was a secretary at investment & law firms before & during college but people see all my technology jobs and don’t want to let me in the financial arena. The last time I was laid off I was denied even temp office jobs because of my tech experience. With rumors of lay offs coming, I’m hoping accting might save me there, I know I can do it just don’t love it.
The article is good. The thoughts in it are good.
Personally, I’d never waste money on a private school degree unless I had a big scholarship to help with it but we all have different goals. Local & public colleges are as good if not better because of a broader exposure to life experiences – in my opinion 🙂
I don’t think that anything dictates where you go in life more than your ambition to achieve your goals.
You could be extremely dedicated to your field, and be very knowledgeable of it at age 16, then go on to run your own business. There is no need for a person like this to go to college, but its not the norm either.
You could also go to college and get a worthless degree that won’t give you a chance of getting a job, sit on your butt playing video games during the summer instead of getting an internship, and think someone wants to hand you a job because you have a piece of paper from a nice school. It doesn’t work that way, and experience seems to always be a key factor. (and in this case college seems like a waste)
But, in most professional fields, it is expected that you went to college and it does provide a very solid foundation for a career. From personal experience, I can say that WHERE you went to college can be a factor in getting a job (it has been in all 3 professional jobs I’ve had) whether is a personal connection with the person sitting across the table (because you both went there and had the same professor) or just the name of a good school.
That said, college is not for everyone, and I think it would make a lot more sense to push people who don’t benefit from college to go get a technical degree. It seems to be looked down upon in this country but we need those people to make the country run. There needs to be more education on what options are available to high school graduates.
I got a lot more out of college than just a student loan bill. It taught me how to handle finances, speak well, write okay (I am an engineer), develop relationships with people in my field, etc.
I call bullshit.
While the decision to attend college (or pay for someone else to) is personal, as is the choice of school and major, this article claims to frame the choice to attend college as a purely financial one… but then does a crappy job of running the numbers.
I agree with Jesse (comment 57) who had a whole list of things missing from the analysis: benefits, security, employability, danger. What’s the cost of never having access to medical insurance while working a manual labor job with draconian sick leave policies that leaves your body increasingly broken over the years? That’s what a lot of people (not all, so save your anecdotal evidence) with just a high school degree can look forward to. What’s the cost of having to look for work 10 times as long as someone with a degree because they get the jobs instead of you? Of having to live in a bad neighborhood that costs less… and dooms your kids to attending crappy and even dangerous schools? What’s the cost of having a lower standard of living (Parkinson’s second law can cause problems… but it can also be great)?
No, college isn’t a requirement for everyone. Certainly super-expensive private school isn’t. It’s not just a financial decision. But framing it in purely financial terms requires that you be honest with your finances.
Sigh, ok, let’s start here. Unless you have an unlimited income, you are an IDIOT if you pay 109k for a four year degree. Scholarships and grants should cut this down significantly. Also if your school is 25-35^k/year you should do a year or two at a community college first. Also Jason, obviously it is your choice, but I think splitting college costs between the parents and student is invaluable. This way the kid is not riding your coattails and taking the education for granted. Parents these days are digging themselves into a financial grave by believing they need to cough up the entire amount. I personally know MANY people who paid themselves completely through college. And believe me when they had the choice of drinking or studying they knew which they had paid for. Anyway, I think college is extremely overpriced but there are countless ways to avoid swallowing the pill they try to shove down your throat.
I really enjoyed this post, Jason. Looking at the comments, it’s clear you’ve sparked an interesting discussion. You bring up a good point that college isn’t for everyone simply because it’s the logical next step after high school. I tend to agree with Ethel (#32) that college is most beneficial for students who focus on doing well in their courses (regardless of degree) and pursuing valuable internships. For students with different priorities, the overall value of their education will be more of a toss-up.
This article seems to rest on a number of questionable assumptions, most importantly
1-the ‘financial benefit’ of a college education can be measured by the retirement savings in cash
2-that savings rates will not vary by income
To address point 1, what counts as ‘savings’? How do rates of home ownership vary by income level? Retiring at 60 with a fully paid off house and an extra $200,000 makes a significant difference. You may have spent some of that other money sending your own kids to college, thus increasing the money they have available to spend on you (medical care, visiting with grandkids, etc).
Point 2 is related. I couldn’t find any figures on how the savings rate varies by income level, but that does not justify the assmuption that it does not vary!
Taken together, in my opinion these invalidate the entire financial argument. Doesn’t mean that going to college is a good financial idea, or everyone should do it, but makes this article pretty irrelevant.
Tyler – great comment.
I think a lot of high school grads would be well served by looking at this post. Even if the “formula” isn’t all that valid, at least it might get them to think about what they will be doing after college.
I think a lot of people (like myself) have a hard enough time figuring out what to take at college and don’t put enough thought into the after-college life.
Although I remain committed to the idea of the non-financial value of a college education (particularly at smaller institutions), I appreciate seeing the conventional wisdom challenged.
Although it doesn’t relate directly to your point, I couldn’t resist sharing this anecdote. I have 3 brothers. 2 of us have 4-year degrees, one attended some college but did not receive a degree, and one did not attend college at all, not a single class. Based on that information alone, can you correctly rank our incomes? Hint: The exact opposite of what conventional wisdom would tell you.
There are a lot of factors besides a college degree that affect one’s income. I’m a stay-at-home mom working part-time from home. My one fellow graduate is a missionary. The brother who attended some college is in the military, and entered at a much higher place in the pay scale than he would have with no college credit (and not nearly as high as he would have with a degree). The brother with no college education is an entrepreneur in the music industry, with people-skills coming out his ears. Not only is he a millionaire, but he’s in his second year of TEACHING a college course in his field. How’s that for irony?
“[a private university education will] provide options for your children that they may not otherwise have”
And what, pray tell, might those be?
Re: point 2 of @Jac’s comment, I ran into the same issues. My Google-fu has failed me in this area, also. Obviously, this isn’t a white paper or the definitive word on college vs. no college. A few (some of you would say a lot) of things were simplified and held constant to isolate one variable due to the data not being readily available, or this being a quick back-of-the-envelope calculation, rather than through intent to mislead or a hidden agenda.
Thanks again, everybody.
Check those public school numbers carefully.
I’m looking at around $24,839/year for my child to attend the University of California at Irvine — as a resident. Non-residents would pay an additional $22,559.
The UCI estimated budget includes $1,592 for personal expenses, $1,445 for transportation, and “rounding adjustment” of $113. It also assumes that the students spend their summers with their parents.
These numbers would change the private/public breakeven quite significantly…
@ Greenman, the quote should be read as “(providing a lump-sum gift) may provide options for your children that they may not otherwise have”. I think you’ve accidently read this quote out of the intended context.
Of course, there are probably a bunch of secret societies that your kid could get involved in with private schools that don’t have chapters at the normal state schools. 🙂
My wife & I have some grown children and some still at home. Of the ones grown & gone, the college-educated are doing only marginally better that the ones without formal education beyond H.S. My wife has one year of college, I have none. After working for various companies for several years following H.S., I started in business for myself and have never looked back. The income I make doesn’t qualify me as rich but I wouldn’t trade the lifestyle our family has for a college or university educated top management-type or professional position.
Please don’t tell me that higher education isn’t all about the money. If there’s no opportunity to better yourself, move forward, enjoy your life (read: finances needed), then no one would waste the time. And I, for one, couldn’t care less if any of the rest of my younger kids go to college. I have yet to see conclusive proof that it’s worth the time/money for the vast majority of people.
For the HR people who begin culling their lists of potential hires by throwing out the non-educated, may I suggest a different approach. The marketplace needs and rewards initiative and confidence much more so than the meaningless learning from colleges & universities.
I believe Mr. Barr is correct, given the price/quality ratio, college may not be (and probably isn’t) for everybody.
Jason,
Interesting post and your calculations make sense. However, I am of the opinion that a college degree opens up more windows for an individual. Even just from a financial point of view which is what this post is all about. For example, networking with people in professional organizations or during university who are likely to help you find good jobs etc.
I would also argue that the earning potential for a college graduate is accelerated faster due to promotions and moving from job to job. I’ve known people being skipped for their lack of degrees.
With that said, I know people who are successful that never went to college or dropped out. I also believe there are many ways to keep college costs down. My brother who is a junior went to a community college for the first 2 years then now dual enrollment at a univeristy and cc while living at home with our parents.
Do what works for you.
I am really, really happy that I went to a private 4-year college. It was expensive, but the school helped me nail a spot in medical school (which will also be expensive!). I am absolutely sure that is what I want to do with my career and it would not be possible sans a degree.
Don’t forget about the community college option. Some schools offer a really great variety of classes for awesome prices. Some universities – i.e. Harvard, NYU, Boston University – also have *excellent* extension schools that will grant you a degree with very flexible schedules. As long as you matriculate, you’re eligible for aid.
Also, the federal government will loan you funds at zero or low interest if your FAFSA indicates that you need it (but any such loan is only interest free while you’re in school, admittedly). What I find strange, though, is that mortgage rates are lower than the rates on many student loans. What does that say about our values as a society? Is buying houses really more important than being educated?
Hi Tyler K,
You are my favorite commenter on GRS. While I may not always agree with your points, I’m glad you are here.
-Charlotte
Yes, absolutely a college education is a key to financial success. It is one of the definite building blocks. Unless you are super gifted, or have some fantastic idea to implement, it behooves 99% of the population to get their degree.
Not having one will hurt you in the long run.
For public schools, there are a ton of them that are great, and I’d rather choose over any private school. These include: UCLA, UC Berkeley, UVA, Michigan, William & Mary in the top tier. You can do anything you want, just at least get your undergraduate degree.
Rgds,
RB
Great post – one that hit me on two levels. First, I spent $3500 (books and tuition) over two years in an allied health program. My parents had saved up about $1000 to help me out, but had been very firm: If you want to go to college, you’re going to have to pay for it. So the two years were brutal, but, looking back, it was over quickly. I made $40,000/yr right out of school, with no school loans. Was it worth it? Absolutely.
Now, I find myself teaching in a college in the same type of program. My students will spend about triple what I did but will make a little more than I did when I was starting.
If you’re looking for a solid career without a huge investment, don’t overlook 2 yr allied health programs at community colleges (respiratory therapy, RN, radiography, sonography, etc.).
Bob (93)–One reason people might pursue college–apart from money–is the perception that it leads to more money. It’s become the default choice of the masses, and in some socio-economic groups, it’s expected. In the high school I attended, the question wasn’t ‘are you going to college’, but ‘where are you going to college’.
Societal program has a lot to do with it I’m afraid, especially if one or both parents are college grads.
But I have to agree with Tyler (72) that the correlation between college and earnings has become much weaker than it once was. Socio economic background plays a much bigger part, IMHO. I’ve seen too many examples of non-college types either running a successful business, being top salesman or running a department or company.
Ultimately, desire, instincts and people skills will trump education, and the cream will rise to the top regardless of credentials.
This is a very poor thesis.
A few seconds Googling shows that the earnings potential here for both college and non-college grads is way overestimated.
But perhaps the biggest failure is the assumption that wages will keep pace with inflation. That is not the over the past 30 years, and there is no reason to believe that it will be in the future. Moreover, the sorts of jobs held by the non-college educated workforce tend to be the sorts that fall even further behind.
Finally, a college degree is the cost of admission to graduate and professional degrees, which have the highest return in lifetime earnings potential.
This is not to argue that everyone should go to college. (“The society which scorns excellence in plumbing because plumbing is a humble activity, and tolerates shoddiness in philosophy because philosophy is an exalted activity, will have neither good plumbing nor good philosophy.”) But it’s not a decision that you can leave to median wages and interest rates either.
I got into a state school, UC Davis, which costs $25,000 a year. But the public school I go to (Sacramento State University) is raising fees by $500 a semester, and it will still only be $5000 a year plus books. Community college and then transfer to this school would be even cheaper. I’m not seeing the concern about high costs here; just choose a cheaper school.
It is definitely important to distinguish between high and low cost public schools. If you’re going to pick the most expensive public school available, don’t be surprised when you graduate with debt!
I think many universities with expensive tuition are highly over-rated. I think you CAN make a decent living with a 4-year degree earned at a public college that didn’t cost an arm, leg, and your first-born. As an example, my fiance went to a 4-year university with high tuition costs while I went to a community college for two years and then transferred to a public university for my remaining two years. I paid off my student loans easily after graduation. I graduated being only $8000 in debt because of this and a combination of working part-time to pay for the rest. My fiance – on the other hand – Is still struggling to pay off his debt. And I made $10,000 more last year than he did! My degree is in biology/chemistry, and his is in computer science, so our degrees should reward approximately the same salary range.
Having attended both a public university for my undergraduate degrees and a private university for my graduate degree, and having worked as an admissions officer for over 3 years, I can personally attest to validity of Jason’s math and truth in his observation. College is not for everyone, and that’s okay. Like anything in life, individuals can have choices and how they learn and grow from those choices can produce dramatic, unforeseen outcomes, both positive and negative. To parents: help your children learn from their own mistakes as well as your own past choices, both good and bad. To children (young adults): listen to those who’ve made choices you’re thinking about making, be open to learning from their choices, and then make your own decision that feels right to you.
Guess what…you young American youths have been duped (what else is new)?
The only thing a college education ever meant was to:
A: Fill the coffers of the schools.
B: Provide the skills necessary for the workers (Slaves) needed to work for Corporate America and make Corporate America richer. History records that most of the Robber Barons and founders of the Corporations that ushered in the Industrial Revolution in the U.S. came from Europe with funding from alleged unknown sources ( We know where the funding came from) with little or no education beyond Grammer School. (You know..reading Writing and Simple Arithmatic). In reality…this is all that is really needed if you have the funding and blessing to become one of the so called elite Captains of Industry.
Don’t take my word for it. Do your homework and due dilligence.
For a while this was not too bad until NAFTA.
Now…you suckers,the jobs that were here are now in Foreign Lands provided by the GREED of Corporate America and their overseas divisions. And by the way…these new slaves work for a bowl of rice. How can you expect to compete?
You don’t need more education…you need a pick axe and a march on…well I won’t say where because there are too many places to name.
But keep the faith and endure. Help is on the way.
Good write up, and good questions to consider when you are talking about forking over that kind of cash.
I think it is also important to think about the kinds of opportunities that a college degree opens up. For example. While the average person without a college degree will make less then the average person with a degree I would suspect that the bell curve is skewed towards the lower end of the spectrum.
Meaning you will find fewer and fewer HS Diploma toting folks as you start to climb the salary ladder. You will never find a Dr. or Lawyer (Doogie Howser, M.D. is the exception) who is straight out of high school. If you want to have access to the highest paying jobs the bottom line is you need a college degree. There are exceptions, but they are pretty few and far between.
Likewise as you slide closer and closer to the poverty I would theorize that you will find fewer fewer folks with a college degree. As with the previous example, there are exceptions.
Also this doesn’t seem to factor in a persons earning potential down the road… just right out of the gate. The average American is changing careers several times in their life, not just jobs, careers. Gone are the days (well nearly gone) of get a job and keep it until you retire. More likely you will be promoted (more earning potential), gain new skills (more earning potential), and change companies (could be more earning potential). That is to say the professional ladder is a lot longer (more chances for advancement) then the voc-tech ladder.
So while the difference in wages at graduation may be dishearteningly close, at retirement age you are a lot more likely to have widened that gap.
Lastly, this is an hypothetical sittuation. Ideally you work in the job that makes you happy and pays you the best, and ideally there is a job like that out there for everyone. In the real world you don’t always get the dream job, but part of College is figuring that out. To me there is value in that. I say repeatedly that the best thing I got out of my college education is no my masters degree, but rather the experiences and skills I picked up along the way. The degree is just a happy result.
You really have to choose a field that pays a lot to make college worth your time. Liberal arts degrees are money sinks in the vast majority of cases.
This one has been my favorite so far! Enough that I actually had to comment to get my vote in.
Great post Jason – I really like your writing style.
I graduated 4 years ago and now have a job I love – however, it pays the amount of student loans I ended up with per year. I also know that I never would have gotten this job without the degree. I will be paying for it for a while.
Two year schools definitely have their place. I know that because of the way they teach several firms in town will take the community college grad before the University grad because the university doesn’t teach people how to work in the field and they have to train them from the ground up where the community college grads just need to be acclimated to the business.
Here’s the thing: It’s always parents who mull over whether its best for their child to go to school or not (often before they are in high school). Here’s the thing – the kid doesn’t think like you. It doesn’t matter if you think of some financial theory that would make sense for the child to not go to college. Ultimately they will choose.
For example if they love carpentry, as one of my friends does, they may opt out of college, as he did. This just makes sense to him since it is what he will be doing the rest of his life. It’s his desire. But as for me, I went to college because I wanted to work at a financial institution and you simply cannot get there without a degree.
In the end, your child will choose, not you.
It’s hard to place a value on other intangible benefits you receive from going to college though. Some of these include: learning to interact with others that may come from vastly different social backgrounds, professional networks, intellectual stimulation from being surrounded by people that are just as smart as you, and of course self reliance after 18 years of living in a nest.
While income potential is fantastic, I don’t think it should be as highly valued as most people make it out to be. I took a year off after I graduated to study abroad through my University, and even though it was a year of lost earnings that could have compounded greatly for 40+ years, I personally would never regret the life experience and friends made.
First off, disclaimer I’m employed by a University, I’ll spare you the plug for my school though.
That said I’d recommend checking out tuition in the Midwest. The traditional farming and ranching states tend to be hurting population-wise, recruiting is paramount for us and prices are competitive. Here, $6k will get you both Spring and Fall Semesters. A 100k debt boggles my mind, then again pay and cost of living are a lot less for us out here, no one said you had to stay after wards though 😛
Shop around, accredited education comes in all shapes, sizes, and price points. An education may be one of your biggest purchases perhaps chosen though at a time in life when people tend to be the least rational in age, choose wisely.
I’ve sent my 5 kids to private, elite colleges on financial aid. The costs were cover mostly by grants and scholarships.
I am an immigrant, earning just enough to cover our needs in a frugal way. My kids had to do without lots of things while growing up. We had no other debt but education debts. Going to college to us is a life style which enables us to enjoy our lives to the fullest, to broaden our knowledge, to work up our potential. To earn a degree and get a good job are the result from learning for the sake of learning. We are not realistic but our lives are so much richer.
Sometimes, when you think too much on how to get the most for the $ you compromise the quality of life.
the value of my education (8 years, you don’t want to know how much it’s worth, vast majority paid for by the feds) is not in how much money i make. it’s in knowing that my work will benefit the public. it’s in knowing that i may work a ton of hours, and work may follow me home, but my talents will be used to further advance the health of people around me.
as my next advisor has told me, those who have the ability also have the responsibility to use it.
someday i will probably make decent money, but for now the last 5 years spent scraping by on a pittance of a stipend will not set me any further ahead income-wise than the day i walked out of college with my bachelor’s degree.
with 5 years experience, someone with my bachelor’s degree will be in the same job, because the ceiling is fairly low. i will be moving up as quickly as possible, since the ceiling is far higher for phd graduates. i am not a follower, and i would be miserable in a long-term bachelor’s degree type job in my field. i am always seeking to gain more control over myself, my environment. my degree was intended to put me in position to do that. and i have a little debt to pay, but no regrets for the increased opportunities i have the chance to earn.
This candidate failed to see the other factors involved in the college decision — something that I’m always very glad to see J.D. do. I don’t think this candidate’s anywhere near as good at analysis of a complex problem or as willing to look at all angles as J.D. is, rendering both his skills less impressive and his conclusions less valuable. Pass.
Hi! I personally have worked with people who were making a $250,000 salary 5 years ago, who now work in factories making $8 an hour because other jobs aren’t available. They used to be the ones hiring people & other high up jobs.
I have friend who makes around $85,000 a year. Would you like to make that much? He doesn’t even have a high school diploma.He delivers big yard dumpsters for a refuse company.
My husband makes $23,441 a year & just got his GED& he loves this job.
A friend’s daughter is going to go to college & it costs around $27,000 per year at the college she’s going to.Her parents even said they wonder if there will be jobs available in her field when she gets out. I think it will be tough & really expensive.
My nephew ha just a high school diploma & is working for a company that drills oil & gas wells. He talked his way into the job, knowing nothing about it & now he’s a real expeert at it. He makes huge wages.
So the point is, it doesn’t necessarily mean you will make good money just because you have a college degree. Some of the best paying jobs are learn on the job types.Myself I don’t reallythink acollege degree is worth it, but only you can make that decision. I know at least 4 people who are millionaire that you wouldn’t ever know they are & they never even finished high school . Two never finished grade school.
There is a program that can help you get a college degree for less , if you want one. It’s called http://www.collegeplus.org/ . You can check it out to see, if it’s something that could help you.You do a lot of courses by CLEP.Lisa
Another thing we may not consider is the question of how many college grads are working in a field directly related to their major 10 or more years after graduation? How many are even still working in college norm occupations?
I’ve known several people with college degrees who found success in non-college fields. A lot of the college degree equalling more money connection may have deeper roots in the desire and ambition of the degree holder than in the degree itself.
Globalization and technology might make this even more pronounced in the future.
While individually, folks may or may not be more or less successful with or without a college degree, the general principle that going to college improves one’s ability to earn money along with increasing life satisfaction has been proven time and time again in study after study.
College, in many ways, is more than just a GPA. I believe it is dangerous, or delusional, to downgrade the college experience (and expense) because of a perception that a small minority of folks can make $$$ without one. Those are exceptions.
Further, the cost of college is overly inflated by commentators and the OP. After 10 years of college, the “sticker price” on those years stands at about 120,000. In actuality, the price I paid was closer to 50,000, and I have no debt from my schooling as I worked throughout.
If there is waste in college spending, it is for an undergraduate degree, where any local college or small university provides a similar level of education than a big private school. Money is well spent at the graduate level and above, but I see too many families sending their children off to a private undergraduate school costing 30K + room and board. My undergraduate was spent at Georgia Tech, with scholarships, a job maintaining bowling lanes, and
being an RA, cost me nearly 0 dollars for 4 years.
There’s a ton of intangible benefits too which are too tough to quantify.
I did a media studies degree in undergrad because I expected that I would go to law school. Thankfully I went to law school since that degree, while fun, wouldn’t have done much for me in the real world. It did allow me to get the marks to become a lawyer, so I guess it was alright.
And then you have to wonder “Was college worth it?”
I went not for the earning potential but out of genuine desire to learn–thus the English major and not engineering.
I think that the “earning potential” of a degree is useless at this point: I can’t get a mall job because they’re afraid I’ll skedaddle when something better comes along, but I can’t get a *real* job either because my degree is about the equivalent of a doctorate in folding t-shirts.
I don’t regret going to college, but I think people should check their motives and the strength of their desire to study before going. The $18,000 debt I’ve accumulated tells me that much.
People clearly like to give out anecdotal evidence in this thread. The stories of people you know who don’t have a high school degree and make six-figures are the equivalent of the person who exclaims, “My 90-year old grandmother is as healthy as a horse, and she still smokes a pack a day!” While that may be true, I wouldn’t give my 16-year old cigarettes. I also wouldn’t tell them, “You know I cashed out your 529 when you were 6. We just didn’t think college was for everyone, so we decided it wasn’t for you.” This is the problem I have with this article. It’s talking about parents saving for college for their children, and then makes the claim that college isn’t for everyone. But what parent is going to decide, when their child is young, that they won’t open that 529? I understand that not every 18-year old is ready for college or even should go to college. But I can’t imagine a parent deciding that for their child at the point when the parent would be considering opening a 529. Again, when people say that college isn’t for everyone, they are talking about someone else’s hypothetical kid; they are not talking about their own 9-year old.
In addition, for those of you who keep talking about how useless liberal arts majors on (again I assume you mean humanities majors), I urge you to look at real statistics and studies, rather than anecdotes, before talking with your kids about potential majors.
The Association of American Medical Colleges has for years been reporting on medical schools’ increasing interest in humanities majors because these schools recognize that technology is always changing and they want students who can do more than just memorize anatomy. (http://chronicle.com/article/Competencies-Not-Courses/47695) Another poster commented that you should look at the earnings potential of your degree 15 years down the road. We work in an economy where people change career fields–let alone actual jobs–every few years. It is almost fruitless to try to predict what your 18 year old’s major will be worth when s/he is 33. And how many employers have ever asked you about your major in a job interview?
The point of this article really boils down to: it doesn’t make financial sense just to give your kid $100K in tuition costs. You have to raise them so that they will work hard, make connections, get internships or jobs in the summer, etc. I just don’t find that as interesting as other guest posts.
Neither my husband nor I have a college education. Out of four children, only one has gone on to complete a higher education degree. Two are of college age right now. Both of them began but quit after not being sure what they wanted to pursue in the way of a major. They are both working in a great field right now and earning a good living – upwards of $20-$30hr. with a lot of overtime. They may return to college but it will be with their own money and with their plans certain so that the money they do spend will be worth it to them.
That is basically what Jason seems to be saying here – be sure you know where you’re going and then it will be worth it no matter which way you choose. I believe you will work a lot harder on an education if you have to pay for it yourself and if you are the one who made the decision to attend college. Good comments and thought provoking post Jason.
When I taught undergraduate non-traditional students, I used to break the ice in the first class by asking them what they hoped to get from their time spent in college. Most of them stated they were there because they wanted to make more money at work and needed the degree to move up their company’s ladder. At the time (in 2005), I believe the statistic from the Department of Labor was that only around 26% of adult Americans have Bachelors degrees (so clearly college isn’t for all, or even most), only around 7% have Masters degrees, and only around 3% have professional degrees (PhD, MD, JD, DVM, etc.) (Note that the 7% and 3% are part of the 26%, not in addition to it.) That said, aside from the money, what about the satisfaction that a graduate feels, knowing they’ve achieved something that few others have completed? Self-esteem has been vastly overhyped in the last 30 years, but I find that people who believe in themselves succeed in life. Success breeds success. 🙂
i’m pretty surprised this seems to be a favorite writer.. I liked jason’s previous post, but this one is terrible. the math isn’t clear at all, and it makes terrible assumptions about income levels… who graduates from college, gets a job, and receives nothing more than a cost of living increase for 40 years? in the 3 years since i graduated from college my base salary increased over 45% due to promotion out of an entry level position. how can you claim that someone making 60% more take home than someone else will save at the same rate? how can you completely discount quality of life from a different job? i’m all for someone not going to college if they have a different job calling (vocational school especially, or military like the author took, these are both excellent career choices for some people) but the financial justifications here are at best not convincing, and at worst totally false.
@120 Ethel
I think you were speaking of my post when commenting on researching what your field would pay at 15 years. Maybe your field is different, but engineering isn’t too hard to look up at least rough figures.
Let’s say you wanted to be an engineer for 10 years, and then broaden your horizon and be a manager soon afterward. Salary.com has information for an engineer at roughly 2 years, 5 years, 8 years, and then information on 8-10+ years of experience in the field in a managerial role.
I agree people are changing jobs left and right, especially nowadays. But in my situation at least, I wouldn’t go from engineering, to say sales, finance, chemical research, etc. I would definitely move jobs as opportunities presented themselves. However, I would stay in the realm of mechanical engineering.
Although I appreciate everything I learned in college, I can say that having two bachelor degrees (business and foreign language) has not helped me get a job making more money than someone who didn’t go to college.
Right now I make less money than someone without a college education but has more “experience”- and I’ve been in the work force for nearly 5 years. In my experiences so far, my employers SAY they value a college education, but it is an was not reflected in my pay nor in the requirements of my job or the tasks they give me. But they would rather hire someone that DOES have a college degree, and all the jobs in my field I look for require a degree.
It seems like a catch 22 to me right now. Screwed cos I did go to college, but screwed if I don’t. Perhaps I need a new job.
Paul (122)–As “low” as 26% with bachelors degrees might SEEM in the US, it’s substantially higher than the percentages in Europe and Japan. We have no real shortage of college grads, apart from a few specialized fields that most American students shy away from.
As a superintendent of a large school district I found Jason’s writing to be right on the mark once again. Most of the students from my high schools go on to college, but when I do exit interviews with them it is clear that have no idea of the cost of the school or the impact of borrowing to get to a college degree. Most have never really explored the relationship between the cost of higher education, the earning power of their degree, other possible options besides a four year program, or how long it will take to get out of the financial hole that will graduate with. Many head off to private schools instead of public schools, because the parents want bragging rights even through they are placing their child in deep debt. This continues to be a concern that I often speak to parents about. It is for this reason that Jason’s blog, like others he has written, should be required reading for all of my seniors!
While I agree with some of the conclusions of your article, such as a college degree is not for everyone and should be carefully considered, I don’t think your analysis works from a purely financial standpoint. You are comparing the amount saved for retirement under the two scenarios as though that were the only financial return. I agree with you that those who make more are not likely to save more. But they still make more and whether it is saved or spent, they receive the benefit from it. Your analysis took into account the 5% that was saved, and ignored the 95% that was spent. The 95% that was spent still provided a better house, more vacations, nicer seats at the opera, bigger BBQ, or whatever it is that the college grad valued enough to spend that extra dough on.
The return on investment from the college degree is found by comparing the initial investment of $109K with the additional salary earned over the life of the investment. When I consider the additional income year by year as a benefit, and also the opportunity cost of the salary missed for the first four years while in college as a negative (or an additional investment), the rate of return on the $109K is about 8%. If we ignore the opportunity costs and only compare the cashflows from year five on it gives us a return on investment of 17.5%!
Another way of looking at this is that if someone told you that for an investment of $109K now and additional investments of $30,732 next year (the salary not received because you are in college writing papers) and $31,961 in the following year, etc. for four years, you could purchase an annuity that would pay $14,904 in year five, and $15,500 in year six, etc. through age 65, would you want to buy that annuity? It doesn’t matter whether you spend or save the returns, that is a different calculation.
Of course, this simple analysis ignores taxes, which would lower the return, but also ignores that Social Security benefits are also affected by lifetime salary, so the additional cashflows may not end at 65 (not to mention that some people may work long beyond 65 by choice, a possibility that increases if one actually likes their job).
Don’t get me wrong–I don’t believe that more money will bring happiness. I do believe that digging ditches or working an assembly line for one’s whole life probably will not bring a high level of satisfaction for most people.
And, as has already been mentioned, there are a lot of intangibles to consider. But if this is a purely financial analysis, which you have said is your definition of success for this exercise, it is pretty simple. What is the present value of the $109K investment versus the $1.7 million return over the next 45+- years? Of course, if you only spend $20K for college, which can be done, the return is even better. And the intangibles are normally (though not necessarily) all on the college side.
i think a college education is highly overated. i am currently in my second year and i cannot see myself working in the field i am studying for. not to mention the job scarcity. so many graduates are taking longer and longer to get employment and some that ate lucky to get one are stuck in dead end jobs. i want to be an entrepreneur and i have a few ventures in the works instead of staking my financial life on an unstable job market
+1. Insightful. Unlike my reaction to the post that explained to everyone that attending an expensive private university puts you in a financial hole, this is a thought provoking article that makes you reconsider your preconceptions about a college education.
Here’s a practical example. When I was hired by a fortune 100 company for tech support back in the 90’s, I started as a temp. Another guy with more experience had been temping longer. We both got hired as employees. I was brought in as a level 4 because I had a degree. He was a level 2 because he didn’t. I switched to development, so did he. Starting two rungs down has definitely compounded for him over the years and I expect he still makes less than me even though we do essentially equal jobs. If I leave, not having a master’s degree will hurt me in the same way.
If you are going to college simply to train for a job by all means do the calculations and make your plans accordingly.
Because the degrees that I pursued were not neccesarily the ones that get you into high payng professions, I would have to say that college was probably a wash financially. But in terms of life satisfaction, it was worth every penney. I learned about subjects that I would have had a difficult time exploring on my own – statistics, various sciences… I also learned some ways of thinking that I wouldn’t have on my own – the scientific method, looking at data critically etc.
I think everyone who is the least bit interested should go to college but not so that they will be financially richer, so that they will be intellectually richer and better citizens.
Very interesting article and comments – now to add my 2 cents.
First, I think the answer to the question is “it depends.” While you offer essentially a “life-cycle costs analysis” with a quasi-‘net present value’ of college versus no college that favors no college or a neutral stance, you don’t do a good job of outlining your assumptions, which might be skewing your answer. Some of these assumptions have been brought up, i.e., it looks as though you assumed a liberal arts degree. I’d like to see the same for a technical or professional degree with comparisons. As noted by other commentators, it is difficult to near impossible to practice in engineering, medicine or law without the prerequisite education, undergraduate, masters and post-graduate. You also didn’t include possible scholarship opportunities and how that might reflect in your analysis. Additionally, many community college systems have reciprocity agreements with the state universities that allow someone with an associates degree to matriculate to the state university for a follow-on bachelor’s and beyond. Also, what about getting an associates degree or technical vocational certificate – how about comparing those? I know that some ultra-sonographers, or radiation therapists can make good earnings over their lifetime. The former are examples of vocational programs which I find in US society lacking due to the emphasis on a college education. Perhaps that might have helped bolster your argument.
In reply to the commentator that said they went to college to out of a genuine desire to learn – as an engineer, I also went to college out of a genuine desire to learn, and took English and several other liberal arts classes while meeting my engineering degree requirements. In fact, most degree programs require some broadening outside of their core curricula. I learned a specific way to solve problems and where to find information to help me solve those problems. Education is a life-long endeavor. Assuming those that didn’t take the path you did weren’t doing it out of a desire to learn is naive.
GENERAL COLLEGE COURSES – THE BIG RIPOFF !!
Anyone who has a 4 year college degree knows the first 2 years are spent for “General College” classes like geography, economics, history, etc. and those classes are a WASTE if you are seeking a basic degree in liberal arts or even a specific degree in the sciences.
I have a 4 year degree in Chemistry which has served me well over the last 15 years, but if I had to do it again in today’s world, I would have chosen a good 2-year degree at a community college. It would have cost less than half, I would probably make 80% of my currently salary, and I would have started my career 2 years earlier- ALL POSITIVES!
I am responsible for hiring people at my job, and I can tell you that the 2-year degrees are now more popular than ever and you still get a great education.
Wish I would have been smart and cut my education in half!! Thank goodness I didn’t continue to a master or even worse a PhD.
Wow. I couldn’t disagree more with Conrad (#134). My gen ed classes, while they seemed sort of pointless to a college freshman eager to get on with her upper-division science, ended up being some of the most satisfying, mind-broadening, interesting classes I took. I wouldn’t go back and avoid them if you paid me. I’m a firm believer in the importance of gen ed classes — they make for a well-rounded individual, which is critically important (a darned far cry from a “waste”).
Higher education is over-emphasized. It’s nice to think that everyone needs to go to college, but college or post-graduate work isn’t suited for everyone. When everyone pursues a higher education, the pool of talent invariably gets watered down. Graduating everyone from college only means that the degree standards have to be lowered to ensure that everyone passes.
Most people go to college for a better job, but college doesn’t prepare you for the working world. There are tons of classes with no applicability to the working world but which are still required anyhow. It’s a messed up system that just puts people into debt and wastes time.
If all you are concerned about in life is money then yes maybe this is the way to go, but one of the recurring themes here at GRS is that experience are worth more than stuff. I made it out of 4 years of college and one year of grad school with about 70,000 in debt, but I loved all 5 years. I met incredible people that I will always be friends with and had experiences that going straight into the work force would not have given me. I also have a very satisfying job that I could not have gotten without my degree, and not hating going to work every day is worth all of the money to me. I went to a public school, but one that was out of state, becasue I believed it was the right fit for me, and never regretted it.
I’m sure someone else has mentioned this before now, but have any of you in the “No, don’t do college” camp tried to find a job that pays above minimum wage without a degree?
Did the calculations above factor in health, or vacations, or medical coverage, or happiness? I’m not saying more money equals more happiness, but would you consider it a lie that the majority of 55 year old men working in a MacDonald’s are not happy?
I find this article troubling to the extreme in it’s attempts to over simplify this equation. It’s nearly impossible these days to find a good paying job without a college degree, in America.
@Allen #138 – I’m in the “no, I don’t have a college degree” camp and I’ve made way more than minimum wage. On the other hand, I never made more than $60K (San Francisco wages) and never graduated out of the assistant position.
If I go back to work (on disability now) there is no way a fast food joint would never hire me, but moving out of the assistant role would be just as difficult. Its not black and white.
While I can understand that for this blog, approaching this question from a purely monetary viewpoint makes the most sense, I was hoping you were going to discuss the non-monetary value (if any) of college.
I attended one year of private university, one year of community college, and three years of public university, which I’m guessing is a pretty unique experience. But for a nation where we directly foot the bill for our education, we don’t have enough debate about the purpose of college…is it about learning a smattering of subjects? sharing the “college experience”? developing a skill with which you can directly transition into a paying job? Which of these is worth the hefty price tag? How much learning can I more cheaply accomplish using library books?
Hi! To Allen post #138,yes most jobs do pay above federal minimum wage , which is $7.30 an hour , but there are some that do not. My husband makes $11.27 an hour. The medical insurance costs us $162.00 every 2 weeks. He gets 3 weeks paid vacation, plus 6-8 holidays paid , but no sick time .If he were to die the company gives the beneficiuary 1 1/2 years wages & that is not something we have to pay into to get.Lots of people are out of work right now& where he works has had a lay off , but he only has been laid off 2weeks down to 3 days a week & then 2 weeks at 4 days a week & now back up to working 6 days a week.It’s not what lots of folks on here call a high paying job, but we have been able tolive on it with 3 people & one time we had friends who were out of work living with us contributing nothing & still did good. That made 7 people living on $670 every 2 weeks & I know people who have much less. We feel God has blessed us to be able to have all we do. We have no credit cards & never have.We have 2 cars which have no payments & are a 1999 Chevy Metro , which gets 52-55 MPG & a Mercury Sable 1996 , which is larger & still runs good. Of course, they need repairs sometimes ,but that’s still lots less than new payments & higher insurance with new cars.The only debt we have are 2 bills , 1 hospital & 1 dental which are paying on & they total around $3,300 .I buy clothes at yard sales. We have several computers . They are older & slower but am able to use them& got them free through helping out at the computer club & someone gave me one they didn’t want anymore.We do rent ,but that has it’s advantages too. We are free to pick up & move if we want to, no maintenance for repairs & no property taxes.It works pretty good for us. Tell me some of how you live. Blesssings, Lisa
Thanks for this analysis, but I would consider an analysis from an economic opportunity perspective to be more interesting. I think over-education has diminished the value of a college degree (too many degrees chasing after too few jobs). A good plumber’s hourly rate is rather close to a good engineer’s rate. This practical knowledge/labor type job will have an increasing hourly rate as more and more Americans chase fewer corporate jobs.
Those are my thoughts on why I will encourage my children to think of all the options after HS.
This writer fails to look at the big picture. I would not vote for him to be a regular GRS contributor. He knows numbers, but he fails to point out other valuable elements of a college education.
The value of a college education includes a long list of intangibles including critical thinking and problem solving abilities, creativity and resourcefulness, the ability to evaluate information sources and to research and articulate your opinions, a sense of accomplishment and self-worth, the satisfaction of pursuing your personal interests in depth, and connections to professionals and colleagues who can a student get ahead. All of these are qualities that can help a person get ahead in the job market, but (even more importantly, in my opinion) they make huge contributions to personal quality of life, no matter your income level.
Part of the reason so many college graduates are buried in debt is because they make two faulty assumptions:
1) You can only get a quality education at a private institution
2) It’s impossible to work while attending school
I worked nearly full-time for five years while I attended an affordable state college and graduated with *no* debt of any kind. I am a first-generation college graduate currently pursuing a Master’s degree in Education. I’ll acquire some debt this go-round, but the knowledge and skills I will gain from being in school will enrich the rest of my life in ways that I cannot measure. Big paycheck or not, studying at the college level will always be one of the most valuable pursuits of my adult life.
I have to disagree with #121 (Kay). By the time I was in middle school, I knew that I wanted to be a teacher, and I knew this goal required a college education. In addition, my parents made it very clear that I was going to attend college; this was an important expectation they had for me. The method of payment was never discussed. During my senior year of high school, my dad considered financial aid but quickly rejected the idea because of his take on privacy issues. So, my parents found a way to pay for all four years of my education at a public university. BUT, I truly appreciated how lucky I was to have a “free ride.” I worked very hard and earned excellent grades, and I honestly thanked my parents many times for paying my way for me. In addition, as an undergraduate student, I had some of the best times of my life. I am now a teacher, and although I do not make gobs of money, my college education was DEFINITELY a great investment, and I know that my parents do not regret it. Just realize this: not all teenagers are as shallow and unappreciative as people seem to think.
I’ve seen a lot of articles with the cost benefit analysis of a college education, but they never factor in what the numbers dont capture which is the value of expanded opportunities. My wife is almost done with her degree and she’s either been passed over for jobs or just flat out not even looked at because she didnt have a degree. Not only are the jobs she’s getting lower paying, but they’re also less rewarding than those she probably could have been doing with a degree.
Although, money is an important consideration, the choice to go to college or not should never come down to money. Either the student is excited to pursue a career and lifestyle involving continuing education or they do not. If they prefer to take on a trade or work in a job that doesn’t require a degree, then your financial analysis makes perfect sense and college is a waste of time. But, for someone who aspires to earn a degree, continue their learning, and take on a professional career, the numbers are insignificant. I know for myself, a 4 year degree really increased my earnings and lifestyle. However, the most important thing that I got out of college was being surrounded by students and professors of a very high caliber with high standards. It raises your standards and sets you up for life. You can’t quantify that and you can’t really learn that in an hourly retail job, even if you have a large CD trust fund.
Quick: how many people do you know with at least one degree who have been laid off in the past year, through absolutely no failing on their part? How many people have pursued degrees only to find out, whoops, that field dried up and went away while you were studying to enter it?
Degrees are certainly worthwhile, in many cases. But in some they may not be. And in any case, having a degree doesn’t automatically give you financial stability forever, and lacking one doesn’t automatically consign you to minimum wage. Jason’s point was, there are a lot more factors. Consider them all to make the best choice for you/your kids.
I’m sure someone else has mentioned this before now, but have any of you in the “No, don’t do college” camp tried to find a job that pays above minimum wage without a degree?
Plumbers often make more than people with degrees in, say, English. Sales people can make 6 figures without a degree. Construction workers, hair stylists, camera operators and even “executive assistants” often make quite decent wages for their region without degrees. And that’s just getting started. The only thing that can stick a sensible, hard-working person in minimum wage is a really bad local job market.
The value of a college education includes a long list of intangibles including critical thinking and problem solving abilities, creativity and resourcefulness, the ability to evaluate information sources and to research and articulate your opinions, a sense of accomplishment and self-worth, the satisfaction of pursuing your personal interests in depth, and connections to professionals and colleagues who can a student get ahead.
College is not the only place to learn all that – I learned it from my parents. But ironically, you listed the most important semi-tangible advantage of college last: connections. After all, sadly, it’s not what you know but who you know, and college can introduce you to recruiters and so on.
Although, money is an important consideration, the choice to go to college or not should never come down to money.
That’s a nice ideal, but for some people everything must come down to money because they simply don’t have enough. That’s what I most liked about Jason’s article – it shows that if you can’t afford to pay for college outright and can’t stomach the debt, there’s still hope.
It sounds like a great alternative to end up at retirement better off for not spending the money for an education. But what about the life inbetween do you have a wife and family live in poverty level. What kind of standard of living could you expect to provide for them. Studies show that you likely will not live as long because you will not have the means by which to maintain good healthy life styles. I agree with a previous post where is the critical thinking there is more to life than retirement.
Among the things the author left out is the fact that, on average, students attending private college pay about 65% of full tuition. There is often a substantial gap between published college costs and what students actually wind up paying.
Another consideration is that the income numbers assume full employment, which can be especially “iffy” for those without post-secondary education.
I find it funny that so many commenters are annoyed with shallowness of this post.
Jason wrote about financial aspect of graduating college compared with not attending it at all.
He covered it quite well except for not taking into consideration the grants and stipends that can substantially lower the overall cost of college.
Of course such onesided evaluation is, well, onesided 🙂
The real value of college is incalculable, mostly because it depends on the person attending it, the teachers met there, the contacts established, eyes opened, horizons widened etc, etc.
One thing is sure – the article was a perfect stimulus and spurred very vigorous comments.
I’m sure Jason have profited immensely from your input.
Why doesn’t anyone mention the military? I served six years active duty, learned a new language, received a top-secret clearance, traveled all over the US and the world, and last but not least, served my nation. Oh, and now the government is paying for my maasters degree!! Thanks, US Army!
I agree. College isn’t for everyone. Particularly, it isn’t for people who prefer to boil a university education down to career training. If all you want is job training in order to earn a higher income than the average high school graduate, go to a vocational school.
A university education is training for life–the ability to think critically and analyze issues in a wide variety of subjects. The potential to get a better job is a bonus. What’s more, the “better” job isn’t necessarily the better-paying one. People who truly value the life of the mind (that is, the people who actually belong in college) won’t be satisfied with a mind-numbing job no matter how much it pays.
I think people sometimes forget what college’s primary function is supposed to be–providing an education! True, having a bachelors should help graduates find better paying jobs, but…people, including the students themselves, often forget that LEARNING is also extremely valuable.
Even though I, a senior college student, am not planning to have a career in the field I’m majoring in, I’m still grateful for the diversity of things I’ve been exposed to and the general knowledge I’ve gained. If I hadn’t gone for my bachelors, I would have been a completely different person. I would have been more ignorant and intolerant. I also would not have had the opportunity to flirt with several career options by sampling from various fields, which ranged from Asian studies and political science to graphic design and fashion illustration. I think my college experience has helped me become a more mature thinker, too.
Normally don’t do this type of thing, but I just read this book and it was fantastic. Its called “You Have A College Degree, Now What?” and I now feel as if I’m in the right frame of mind for success to take place. I’m graduating from college in May and thanks to this book I now feel prepared. Here’s where I found it at. http://www.amazon.com/You-Have-College-Degree-What/dp/0578044048/ref=sr_1_1?ie=UTF8&s=books&qid=1270658049&sr=1-1
I strongly believe that a college diploma gives you a much better start than a high school diploma. But I am really skeptical that going to private school means you will do so much better in life as opposed to getting a degree at a public school. It’s not about the quality of education, it’s about your aspiration and personal qualities that will help you achieve success in your career. Many fancy private school graduates never really achieved much in life, so we are talking about a bunch of wasted money.
This article here is a very interesting one that really gets a person thinking about their life and how they want to live it. college is important to peoples lives and important to myself as well, but some just might want to take time off before heading down that road of just studying and working. i am going to attend college when my time is right, yes i’d like to make that amount of money and yes i’d like to accomplish more in my life but only as my time comes. But anyways thank you for the article.
my opinion-
I started in SUNY community college wanting to study history but didnt want to teach, and to make real money it would take years upon years I quickly switched my major to CIT Networking. During my college career I was also involved in an IT Internship. I did pretty well high B’s on all my IT courses. But really struggled through math, and english due to my learning disabilities. I scraped by in english c- 101 c 102. I got through math 101 c+ but then I hit a road block math algebra 102. I took it in the summer failed, fall semester by itself and got a tutor failed again with 30’s!. By this point I had 60 credits and still had to pass math 102, college algebra, college trig. The burden of this was so stressful it brought me to tears knowing this was the only thing holding me back. I decided to transfer to a nearby four year private college offering the same networking program as a BS with out the hefty math. I did one year there and really struggled in everything besides IT such as logic which I earned a D, and english, which I failed because I lost my english 101 transfering. Little did I know I also had to take one more math class to fill my math requirement…Algebra… Knowing this I really assessed my situation. I realized I piled up 10k in debt and college really was not for me no matter how hard I tried and dropped out. I switched gears after spring 11 went to trade school online, and earned my Cisco Certified Network Associate Certification. The knowledge of networking I learned through trade school went above and beyond what I learned in college. I wish highschools and parents pushed trade schools/bocies as much as college because college is not the one solution for everyone. You can make just as much money learning a trade compared to your peers that just went to college doing the same thing.
College is a must as everyone says but in my opinion knowledge and proper understanding is a must. Kids have to be trained in every sphere and they should be able to handle situations. A proper attention if given at younger age helps to build career later.
Nicely said. I wouldn’t be where I’m at if it wasn’t for a college degree. If, only if, an individual finds value in starting a business, it’s wise to establish a foundation and a steady stream of income prior to embarking on the business journey.
This article is just a re-hash of the old worn out, out dated sales pitch for college.
The listing of celebrities that have college degrees which have nothing to do with the career they ended up in or that dropped out of college for the career, is a lame argument. I am sure the degree made little difference in the success of their careers (with the exception of Alan Greenspan).
With the exception for specialty careers such as doctor, lawyer or engineer. A college degree has replaced work experience for the entry level jobs. 2 hours in a lab once or twice a week is NOT job experience. If the subject you earned the degree in isn’t applicable to the job required, there is nothing gained in hiring an applicant with the college graduate over one with no experience.
With the same commitment, concentration, time and effort the subject of many degrees can be learned from a book and/or online on your own at home at a fraction of the cost of the required college books alone. But due to the out dated mentality of society as outlined in this article, the person willing to learn w/o a degree is passed over for the one with a degree.
The excuse from corporations is that they can’t afford the on the job training required for those with out the degree. If your degree has nothing to do with the job/career, you have to be trained anyway. College does not replace job training, college does not replace hands-on learning and training. The U.S needs to go back to internships, job training and apprenticeships. A degree has it’s place, but it is not a replacement for all.