Posted on 05/07/2012 2:35:03 PM PDT by SeekAndFind
College is the best investment you can make, President Obama told students last month at the University of Colorado.
As a metaphor for the benefits of education, that statement is fine. But taken as a claim about the financial returns of a college degree, it poses two problems.
The first is that students and their families still lack sufficient data to estimate long-term returns for specific college degrees the way investors do with stocks and bonds.
The second problem is one of investment risk. Stock investors can manage risk by buying a diverse basket of shares, but a college student bets on a single asset: himself.
That makes it crucial that students and their families understand the factors that affect the risk and return of a college investment in order to swing the math in their favor.
College brings higher pay: $1,053 a week for the median bachelor's degree holder last year, versus $638 for a high school graduate with no college, says the U.S. Bureau of Labor Statistics. Last year's unemployment rate was 4.9% for college grads versus 9.4% for those with no college.
The College Board, a not-for-profit association, calculated in a 2010 report (based on 2008 data) that a typical student who enters a four-year college at age 18 and borrows his way through earns enough by age 33 to make up for his costs, including foregone wages and loan interest.
If a bond paid for itself that quickly, the return would be between 5% and 6% a year. That's a handsome payoff; stocks have historically returned around 7% a year after inflation. And it says nothing of college's other benefits, such as enlightenment, fun and higher job satisfaction.
Two big caveats: The College Board math assumes everyone goes to a public college. Those usually cost less than private ones -- often a lot less -- and that skews returns higher. The report also doesn't account for dropouts or extra college years. Only 56% of students who enroll in a four-year college earn a bachelor's degree within six years, according to a report last year by the Harvard Graduate School of Education.
PayScale, a Seattle data firm, examines the links between pay and variables like colleges and majors. Its analysis, which also ignores dropouts but accounts for students who take longer to complete their degrees, finds an average yearly return of 4.4% for degrees from 853 schools. That assumes students get financial aid, as most do.
Here in the oil patch If you have a degree in petroleum engineering, petroleum geology or petroleum land management and augment it with an internship you are pretty much guaranteed a job after graduation paying up to $100k.
An excellent college in our area (Grove City) has their own group of lenders and don't allow their kids to get hooked on the easy to get into debt terms of Fedzilla. I believe Hillsdale College in Michigan does likewise.
If lenders charged loan rates commensurate with risk, kids would be paying 10% or more to go into useless majors like Ethnic or Gender Studies and 2% or 3% to go into useful majors such as nursing and engineering.
No, it is not. It is intentioned to get more business for the now government student loan business, to get kids more indoctrinated by socialists, to get people to thinking that they are too good to be skilled tradesmen like Plumbers and Electricians who can earn much more than your average liberal arts college hack.
Although I'll admit that it will definitely pay off if you are going for a Government job... Especially if you are also a member of a 'protected minority'.
RE: An excellent college in our area (Grove City) has their own group of lenders and don’t allow their kids to get hooked on the easy to get into debt terms of Fedzilla
_________________
It is no coincidence that Prof. Walter Williams ( one of Rush Limbaugh’s favorite subs ) is going to be their 2012 graduation commencement speaker this coming May 19.
I’m just about to graduate with a major on Women’s Studies? Does anyone know what kind of ROI I might get for this degree?
Here in the oil patch If you have a degree in petroleum engineering, petroleum geology or petroleum land management and augment it with an internship you are pretty much guaranteed a job after graduation paying up to $100k.
Here outside the oil patch if you are a high school dropout but can program in Java, C++, C# or any other popular computer language, which most 16 year olds can do, you can make over $100k.
“College brings higher pay: $1,053 a week for the median bachelor’s degree holder last year, versus $638 for a high school graduate with no college”
I tend to believe the difference in pay has more to do with motivation and intelligence than it does with “collage”, per se.
I’m a high school drop-out but have worked my way into a $100K a year job.
But that took a lot of work and self-starting.
I don’t even have to read the comments to know that there will be some who mindlessly say: “Well, they should major in a worthwhile degree, any of the engineering disciplines.” These ignorant statements assume that everyone off the street can handle an engineering curriculum and that just ain’t so.
Does life experience count?
If it does, then I have been “studying” Women all of my life and I still don’t understand them and I have spent a fortune trying to. :)
“These ignorant statements assume that everyone off the street can handle an engineering curriculum and that just ain’t so.”
If it was easy, everyone would do it would not pay so much. What’s ignorant about that?
Q: How does an engineer get an artist off his front porch?
A: Pay him for the pizza!
Bada-Bump!
Spending $495 to $895 and three days here would probably do more for your youngster that $400,000 and 4 years of college ever will:
http://www.tomhopkins.com/boot_camp.shtml?Screen=boot_camp
My late father grew up during the depression (he was born in 1925) and many times told me that most salesmen had money and enough to eat while most other people were unemployed and nearly starved.
If they or you feel they must go to college, here’s a school that doesn’t require tuition, every student is a work/study:
Lol! You’ve been snookered! Mystery is the unbreakable part of a woman’s genetic code! ;)
My undergrad degree was in engineering. To obtain it you had to do multi-disciplinary studies in other 300 level engineering courses. The toughest for me was machine design, under mech E. I worked my butt off and still got a C-. Some people just have the brains for it. I don’t consider myself dumb, but some of my classmates just had a knack for it.
I have a sister who has a masters degree in material science engineering from a brand name U. She sure did get a high paying job right out of school but then life happened and she got married and started having kids. When the kids were all in school she went job hunting for a part time gig found a town clerk job and then went to the state labor board to get her pay raised to minimum age. Right now she is back in school to get an RN. Those engineering degrees need upkeep and cont ed along the way. I have told my college age kids to skip all the drama and get their RN right out of high school at the local comm college then they can go pretty much anywhere get a job if needed. I think they both would really rather have businesses to run but the RN is a good back up just in case.
Depends. Are you going into pimping or pandering?
“Here in the oil patch If you have a degree in petroleum engineering, petroleum geology or petroleum land management and augment it with an internship you are pretty much guaranteed a job after graduation paying up to $100k.”
Patch being located where?
I have a degree in computer science. I’ve been a SAHM for 16 years. I would like to go back to work, but I don’t know what I could do at this point.
We’re in California, and the economy sucks here. A few years ago, I think I could have gotten a job, but not now.
My husband and I both have our engineering degrees. Our son is graduating high school. He has no interest in being an engineer. He’s brilliant at math, but doesn’t like science. He even has told us that the kids that are going into engineering like to figure out how things work and how to build things, and he does not have that interest.
My husband and I know he’s right, so we are not pushing engineering.
Right now, our son wants to major in economics with a minor in statitics and maybe a minor in accounting. He thinks he’ll need to get his master’s at some point.
Bachelors $1,053 a week. What crack is this author smoking. Ill be lucky to get that for an MBA when I graduate. I have 20 years employment history..
When I was in high school quite some time ago the guidance counselors would identify the students that they didn't feel were college-bound and point them in the direction of a trade school. These students would go to regular high school for the first half of the day and then spend the second half at what we called "vocational tech" learning skills such as auto mechanics, welding, plumbing, etc. Many of these students were able to make good money right out of high school.
For some reason, schools have done away with "vo-techs". I think the conventional wisdom is that all kids should aspire to go to college and many of the trades that were taught were geared towards males. Can't have that!
MOVE and by God don’t bring any California with you.
North Dakota, Wyoming and even parts of Idaho BOOMING
We have plenty of Californians in Texas ... pretty sure we have reached our quota
TT
Who's the "dummy" now? Me. I stupidly went into medicine. I make about what a master plumber makes. And if he owns his own business, he's doing very well.
He's not going to get sued by a disgruntled patient/client.
And if a customer doesn't "feel" like paying him for his work, he can tear out the sink he just installed.
“If it does, then I have been “studying” Women all of my life and I still don’t understand them and I have spent a fortune trying to. :)”
It’s easy. Women want what they don’t want, except when they change their mind.
Salesman is a dirty word to a lot of people but they are the people that drive the economy. I forget which sales/business guru first coined the phrase but we all live by it “Nothing happens until first the sale.” I consult with a lot of people doing startups and 9 times out of 10 all my advice is on sales and marketing because so many people with great ideas, great products, really innovative and killer business can’t sell and so nothing ever happens. When I talked to you young people about jobs, careers, college etc I always point out that if money and job security are most important to you then you should learn to sell. Good salesmen out earn the management, the engineers, and all the other workers in most industries. Here’s a fun a example that shows what most people don’t understand about where the money is in jobs. - I know 5 guys in the orthopedic business. One is an engineer. He has 5 years of college, works 50 hours a week and makes 55k. One is a machinist. He has no college, works 50 hours a week and makes 75k. One has an MBA and works in HR at the same firm as the first two and makes $45k. One is an Orthopedic surgeon. He has 11 years of school/residency. He works 50 hours a week and is on call another 24 hours. He makes $220K. THe last guy is an independent sales rep for the orthopedic products the other four guys deal with. He works 40 hours a week, half of it in tropical places with his clients and he make $350k.
We want to, but we want to wait a few years. Our daughters have medical issues, and we want them to finish up high school here. Plus, my husband was recently diagnosed with cancer.
We’re hoping to move out in 3 years.
Yes, I can remember the same thing at the high school I attended. There, they divided the students into two categories, one “college preparatory” and the other not that (I don’t remember the term they used). Again, the males in the latter category were often guided into voc training.
College degrees aren’t worth the paper they’re printed on unless it’s a specific professional degree. And even then, it’s suspect. I hire attitude and work ethic, degrees dont mean sh!t anymore. Sad but true, most kids have zero work ethic. It’s refreshing on the rare occasion that you find it though.
There is plenty of room in Texas for more. I fact, I'm hoping at least 5 million more go there.
Nice joke, but I wonder whether you might be an engineer making fun of those who didn’t major in one of the engineering studies.
If only everyone majored in engineering, huh? All they had to do was switch majors...
You missed the point I was trying to make. It's beyond engineering just being more difficult. Handling the math involved in all the engineering studies is simply beyond the capabilities of most students. Some Freeper, quoting a professor, said that only 15 percent of students could handle the math. So, what the hell do you want the other 85 percent to do?
As it happens my son in law is a plumber and I am related to two physicians. My son in law earned about 80k last year, the Dr’s a multiple of that.
Now it is nice to have some quick MD advice and a prescription called in, but when something serious happens, like a broken water pipe, you know who I call.
The best is they all work steady and enjoy their work.
“Salesman is a dirty word to a lot of people but they are the people that drive the economy.”
Ain’t that the truth! I am an engineer at the top of my game, did consulting for 15+ years, and found the truth in business the hard way. Those “business weenies”, as I used to call them, make the money. A great engineer can make a product and earn millions, billions even, but on whole it is the sales people that can earn the big bucks.
I studied women in college too.
“the RN is a good back up just in case”
The RN requires upkeep, too. You can’t just enter the workplace again after being out for years.
I have worked with a lot of talented people like you who did not have degrees. They really pay for it in a corporate environment.
Many of us went to school for lucrative degrees; once you can command $50K forces are at work to either send the work elsewhere (which wouldn’t apply in the oil patch) or simply bring foreigners in to do it (even if they are educated here as part of the package). In any case, what happened in tech and finance is surely at work in other high-wage jobs; Asians are being trained to do the work for a lot less, often in American universities. I work with one of the larger CPA firms, and of the four people I deal with the partner is the only American. One is Indian, one is Filipino (he said he was recruited from the Philippines for $65K, with no CPA and limited English - better-qualified Americans would kill for that job), and the last is a Canadian national who said the process took her five years to work here. All three of these foreigners took jobs for which there is no shortage of qualified Americans, and their company is probably looking for ways to replace them as soon as they become full citizens and want such things as sick days and Sundays off.
It is frightening; I couldn’t imagine what decisions a fifteen year-old faces today.
Would your son like robots? Would he be interested in AI? There is alot of math and probabilities involved in these areas.
I have recently been doing some online learning, for free, from this site: http://www.udacity.com/ They are on their second six week list of courses and it is interesting and demanding.
They even have a cryptography class. I just took the Cs101 basic programing class in Python. If not for your son, maybe for you.
There are other free online learning places on the net.
Look into it. It could be a way to update your skills.
And prayers for your husband.
“what the hell do you want the other 85 percent to do?”
What does the 99.999999% of us who can’t shoot golf like Tiger Woods do? We make less money doing something else that the world needs. Let them get their hands dirty and learn a trade. Competent welders are in great demand. And while we are at it, let’s quit subsidizing do-nothing majors. The US is rapidly coming to the point where we can no longer afford that luxury
here in Fl it is 40 hours cont ed every 2 years
“I wonder whether you might be an engineer”
Yes, 34 years in the field, and proud of it.
“All they had to do was switch majors”
No, all they have to do is learn to do something that people need. My neighbour is no intellectual giant, but he makes a pretty good living for his family doing backhoe work. And there is NOTHING wrong with that.
Government schools do not cost less, they cost more when all the various taxpayer subsidies are added in. The price is cheaper, not the cost. We'd all be wealthier and better off without them.
A great many people find programming as complicated as learning to speak Sanskrit or boring as hell. You have to have a certain kind of mindset to program for years without your head exploding.
If you don’t know the locations of the headquarters of the major oil companies in the US, you need to get out more.
“here in Fl it is 40 hours cont ed every 2 years”
Try getting a job in nursing if you haven’t worked in 3 years and all you have is your continuing ed...you won’t get an interview, let alone a job. Not in Arizona, where my RN/BSN wife is threatened with being fired every few weeks.
She’s trying to get training in a specialty so she can find work elsewhere. As a med/surg RN in Tucson, she has applied at the other hospitals and let’s just say the phone isn’t jumping off the hook...
“If you don’t know the locations of the headquarters of the major oil companies in the US, you need to get out more.”
Lighten up.
I worked in the “oil patch” and grew up in the “oil patch.”
Was hoping you were simply friendly and neighborly enough, to reveal which oil patch state or location you had in mind.
BTW a lot of the petroleum engineering work and geology work does NOT occur in the “headquarters” and some of it does NOT require a four year degree.
It occurs in field, regional offices.
No ROI, but you do get issued a Victim Card with the diploma. It can come in hand if a big, mean conservative ever expects you to accomplish something.
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