My son and I had a discussion about school and grades the other day. He’s doing great in school, but sometimes we check in to see how things are going and to talk about his future education goals. It helps him stay motivated, and it’s a good way to set expectations for what financial help he can expect to get to pursue his higher education.
After our conversation, I began to wonder what would likely help my son get the best bang for his education dollar. There is an assumption that it always makes sense to move forward and get a graduate degree, but right now my son is leaning toward engineering. I’m not sure how useful an advanced degree would be, especially since there are plenty of good jobs for those with undergraduate engineering degrees. Plus, spending a couple more years studying means that he’ll be that many years behind on having relevant job experience. Is the trade off really worth it?
Recently, SoFi released an infographic aimed at illustrating the return on investment for an education, specifically graduate degrees. This is something to think about carefully because, as student loan debt becomes a greater issue for the next generation, you want to make sure that the bills can be paid.
Which Fields are Worth Pursuing Further?
Which Fields are Worth Pursuing Further?As I expected, engineering doesn’t receive much of a return on investment for a graduate degree. You get great value for an undergraduate degree in engineering, since you can usually get a job with reasonably high pay right out of the gate. Going on to get an advanced degree in engineering will only provide you with a 10% higher lifetime earnings according to SoFi. Yes, it can seem like quite a bit of money, but you also have to factor in that the higher earnings assumes a worker to grind all the way until full retirement age and never changes careers.
Other fields that don’t offer good returns for getting an advanced degree? Business and mathematics. Once again, these are undergraduate degrees that offer the chance for a good job and pretty good pay upon completion of the course of study, and going on for more education doesn’t offer much of a bump in pay.
On the other hand, you can get better value for your education dollar if you get an advanced degree in the social sciences, humanities and fine arts. These areas general start you out with a fairly low salary upon graduating with an undergraduate degree, so you can get a decent bump in pay if you move forward with more education. I know that my ex-husband has more opportunities available to him with a Ph.D. in psychology than he had with a B.S. or M.S. degree. With a bachelor degree in psychology, he’d be lucky to make $40,000 a year fresh out of college. With a Ph.D., though, he had a much higher starting salary and now he makes good money as a full-time lecturer at a major university.
You also want to figure out how long you can expect to be employed. My mom earned her bachelor degree a few years ago. She teaches and she could get a bump in pay with a master degree, but she doesn’t expect to work long enough to make it worth the cost.
When plotting the course of your education, it’s important to be realistic about what you can expect to earn when you finish and whether or not you will earn enough to cover the cost of your student loans. I’ll be having frequent discussions with my son about this.
How about you? Do you think about your ROI when it comes to investing in your education?
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