More Schools...

Back to Articles

Education Pays

Mo' Money, Mo' Benefits

Since when does a degree equal more money? It's no secret that the higher your education, the higher your salary. But in a recent report from the U.S. Census Bureau entitled, "The Big Payoff: Educational Attainment and Synthetic Estimates of Work-Life Earnings" we find that every little bit counts – in the long run.

A college master's degree, for example, is worth $1.3 million more in lifetime earnings than a high school diploma. A typical bachelor's degree recipient can expect to earn 73% MORE over a 40-year working life than the typical high school graduate earns over the same time period. Even an associate degree will give you a 25% advantage. If you're going for a doctoral, know that your average lifetime earnings will be between 2 or 3 times those of a high school graduate.

Other key benefits to YOU and your family:

• You are more likely to be a non-smoker, be in good health, and less likely to be incarcerated.
• You are less likely to be unemployed and less likely to live in poverty.
• Your children will have higher cognitive skill levels and better concentration than other children.

Benefits to society:

• Lower levels of unemployment and poverty and decreased demand on public budgets, with less people depending on social safety-net programs like welfare.
• The higher earnings of educated people generate higher tax payments at the local, state, and federal levels.
• Higher levels of civic participation, including volunteer work, voting, and blood donation.
• Widespread increase in productivity.

There are also many unquantifiable positive results ¨ on a personal and societal level ¨ like enhanced quality of life and boost to the national economy, but these all are consequences of the general trend of higher education. Start with self-improvement, and the rest will follow.

The Fear of Debt

One of the major concerns of students as they face the decision to continue their education is cost. Sure, education can be expensive, but like any investment, it pays off. Further reports on lifetime earnings from the College Board confirm that education is the right choice. And you do not have to look that far ahead to see an increase in earnings; the "interest" on your investment will begin taking effect as soon as you graduate.

Of course, debt is something to be approached with carefully. Yet the difference in earnings is large enough that college graduates can recoup the cost of full tuition and fees, as well as earnings foregone during years of study, in a relatively short period of time. For example, the typical college graduate who enrolled at age 18 recovers both of these major costs by the age of 33. For doctoral and professional degrees, that cost is compensated by higher earnings at the age of 40.

Better Earnings Across the Board

Although there are many factors that contribute to the correlation between education and salaries, the overall benefits apply to all age and racial/ethnic groups. The gender gap also disappears under the democratizing influence of higher education.

White, black, Hispanic four-year college graduates who are full-time year-round workers between the ages of 25 and 34 earn an average of 60% more than high school graduates in the same demographic groups, while Asian Americans have a premium of 80%. Both males (60%) and females (58%) experience an increase. Compare this to national statistics from the Census Bureau on male-female income disparity. You'll find that the difference in overall earnings is quite significant.

More Schools...