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With respect to the 20,000 reasons to go to college, what are your thoughts on the information presented in this article:

http://www.michaelrobertson.com/archive.php?minute_id=226

Well this is a frequently debated topic, and that article points out some interesting data. Personally I see it go both ways and generally a college education is worth the money probably 50% of the time. I am a perfect example myself. My career has absolutely no relation to my college degree. I spent five years studying and spending a lot of money on an education I will not and likely never use.

Does that mean it was a waste of money? You could argue so, sure, and occasionally it does feel that way. But, given where I am right now, my pay and my benefits and the fact that I’m doing something I’m absolutely passionate about and love, I can also argue it was worth every penny. Even though my degree was not required for my current career path, a college education was required regardless of what it was. Not only that, the college experience in general prepared me for many aspects of life that will undoubtedly improve my chances for further success.

Of course I also know many individuals who never went to college and they are earning just as much as our collegiate counterparts, so clearly the money and time spent on an education would have been fruitless. On the other side of the coin I have plenty of friends who never did go to college and they are stuck in dead-end jobs at the age of 30 making 25k a year. You could argue that a degree would improve their chances of higher earnings.

I think the benefits of a college education rely more on the individual than the simple act of going and getting a degree. Some people need the structure and connections that college provides, others have the ability to make due without this and achieve the same things. Others have the drive to simply make something of themselves, others do not. So I don’t think it is fair to generalize and say that the cost of a college education doesn’t provide enough return to make it worthwhile, just as you can’t say that in every case college will advance someone further than a high school graduate.

I think for the most part that college is a good investment. I would argue however that the extra money spent on private schools can have less of an impact, but that is another discussion topic.

On a final note you also have to look at the vast number of professions that you absolutely have to attend college. Doctors, lawyers, engineers, architects, many of the various sciences, etc. There is no way around it, in order to become someone in these professions you need an education, and typically these professions will provide income and opportunities that will eclipse anything a typical high school graduate on average will earn.

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I tend to agree with you re: the professional degrees. But I’d like to see the numbers for a median 4-yr degreed graduate compared to that for a median medical school graduate. Med school seems to take a lot of earning years out of a person’s early working life; does the much higher MD salary really make up for it? It may be a similar phenomenon to the well-worn example of the two IRA contributors, one who contributes early for 10 years and then ceases, and still makes out better in the long run than a second contributor who does so later, for longer, and with higher annual amounts. MDs can have higher salaries, but does that really equate to higher net worths than those with modest salaries who get a critical head start building their net worths?

Good point. I work largely in part with physicians, and I must say they make a great deal of money on average. Easily into the 175-250k range (at least where I’m stationed). It is true that these advanced degrees to take more years of your life and more money for schooling, but even if it takes 6-8 more years after college, does someone making 200k a year benefit still? I think so.

Like you said, there is a common discussion that talks about those who save immediately for a few years and then stop are typically better off than those who start late and save until retirement. But, do people with high school degrees actually take the money they are saving and put it into a saving or investment vehicle? I highly doubt it. While not going to college may save a lot of money, I’d bet that a majority of these people are not using the money they saved to build their retirement plan. That makes that argument worthless. If someone who is 18 and doesn’t go to college starts to immediately max out their IRA accounts then yes I think you have an argument.

Also I’d like to mention that having worked with many doctors, most max out their 15k in 401k contributions. On top of that, many hospitals operate as non-profits or are government owned and also allow 457(b) contributions. That is another 15k per year most physicians can contribute, and most do. That means many doctors are putting away 30k a year in pre-tax money into retirement plans.

Again, someone who didn’t go to college may have their IRA and a 401k with their employer, but I doubt they have the ability to put that kind of money away. So even with the additional years of contributions they may have I’m not sure it always benefit in the long run.

But I do still contend that certain degrees will never pay off. There are so many lousy degrees out there that will land someone a career that maxes out at 35k a year that college would be a complete waste of money. I just think that the data some sites give are skewed because for every worthless degree there are just as many that will pay for itself and much more over the long run. So I stand by my 50% statement earlier. Some degrees will pay off and others will not. But a generalization stating either case is inaccurate, there are too many variables in place.