More Education Equals More Pay

The Bogleheads' Guide to Investing (I LOVED the book -- see my rating for details) includes a chart that lists expected lifetime earnings per education level. The chart lists various education level and what people at those education levels can expect to earn throughout their lives (according to the U.S. Census Bureau.) The results:

• Some high school, no diploma - $1,000,000
• High school diploma or equivalent - $1,200,000
• Some college, no degree - $1,500,000
• Associate degree - $1,600,000
• Bachelor's degree - $2,100,000
• Master's degree - $2,500,000
• Doctoral degree - $3,400,000
• Professional degree - $4,400,000

Just to be clear, here's how Wikipedia defines professional degrees:

In the United States and Canada, professional degrees refer to academic degrees that are specific to a particular vocation or profession. Law school (JD or LLB), medical school (MD and DO), engineering school (BSc. or BASc. in Engineering, BEng., MEng., and DEng.), dental school (DDS and DMD), veterinary school (DVM), business school (MBA), physical therapy school (DPT), pharmacy school (BSc. in Pharmacy and Pharm.D.), schools of social work (MSW), art school (MFA), seminary (M.Div.), and architecture school (MArch) are examples of institutions where professional degrees can be earned.

I've noted several times that your career is your most valuable financial asset, offering you many financial benefits and that you can make the most of it by getting a college degree and managing your career to its full potential. I've also said that doing this well can earn you millions of dollars in extra income throughout your lifetime. It seems like this chart backs up these thoughts.

Want more information? I've got tons of it on how an education and good career management can significantly increase your income. Here are just a few of my posts on the subject:

• This Year's Graduate's Destined to Earn Millions in Their Lifetimes; Average Graduate Can Earn $25 Million if Career is Managed Correctly

• Make the Most of a College Education -- It's Well Worth the Investment

• This Year's Graduate's Destined to Earn Millions in Their Lifetimes; Average Graduate Can Earn $25 Million if Career is Managed Correctly

• College is Expensive, but Well Worth It Financially (Or: Give Four Years and $40,000 and Get an Extra $1 Million)

• Which is More Important -- A High Starting Salary or Higher Average Salary Increases?

Comments

[Matt]

I've always beleived that eduction translates into money, the figures prove it though I think they might be a bit low for Bachelor degrees... and I don't think those numbers made any distinction between industries (this will have an impact too)

[Nick]

The only issue I have with this list is that people with a Doctoral degree actually earn less, on average, than those with a masters. The reason for this is that a very large portion of people with doctorate degrees work as educators who don't make very high salaries.

I'd also like to see the breakdown by profession of these numbers. Certainly someone working in IT who has only a Highschool degree would not be at as high a disadvantage with the lower degree compared to someone who was a doctor or a lawyer where a high degree is a pre-requisite.

[Anon]

There is no evidence that this is a causal relationship. People who drive fancy cars make more money than people who don't. It must be the cars!

[FMF]

Anon -- Thta's right, I guess the path to wealth is dropping out of school and getting no higher education at all. That is surely the path to wealth (or, since there's probably no causal relationship for you that way either, then at least it can't hurt.) Why go to school at all?

Yeah, right.

[Terry]

I worked hard and had saved up $4,000 by the time I graduated high school in the mid 1970s. Then I blew all that money on college and ultimately took out two student loans while working minimum wage jobs. Today I earn my state minimum wage and am still paying off my student loans. I have no money to go back to school to acquire a marketable skill. I have no hope and will probably be broke for the rest of my life and will never be able to retire from my menial dead-end toil.

[Owen]

I live with my dad, and I make $10.55 a hour at a Factory. I get 40 hour weeks, and sometimes I get over time. I only have a High School education. Where is the money? It seems you need to go back to school, but how can a person get a education without money?

[Susan]

Owen,

With loans. That's what I did.