The book The 10 Commandments of Money: Survive and Thrive in the New Economy lists money commandment #7 as follows:
The old-school rules: Not everybody needs a college degree to get ahead. There are plenty of good-paying, secure jobs for people with high school diplomas.
The bubble economy rules: Get the best education you can, regardless of the cost. Student lenders will give you as much money as you need.
The new rules: You need at least a two-year degree to get ahead, but limit how much you borrow for any education.
I'm still sorting out my thinking on this subject as my kids start to approach college age. Here's my take as of now:
- I don't think that everyone needs a college education or that everyone is "college material." There are still good jobs out there that don't require a degree, but these seem to be a lot fewer than in days past.
- It was never my opinion to get a degree "regardless of the cost." That's what gets you $97,000 in debt, $120,000 in debt, or $200,000 in debt. Ugh.
- The key to getting an education is the same as any financial purchase: Will it pay off? Is it worth the cost? Are expected income gains greater than the cost?
- There's a clear way to get the most out of college. I believe if you follow it, you'll be more than fine when it comes to getting an education.
- I'm not sure about the two-year degree recommendation. I'll need to do a bit more research before I have an informed opinion on it.
The book also shares a couple pieces of compelling information in favor of college degrees. The first is the poverty rate for persons in the workforce for 27 weeks or more. It's from 2006, so a bit dated. The results:
- Less than a high school diploma -- 13.8%
- High school graduate, no college -- 6.3%
- Some college, no degree -- 5.0%
- Associate degree -- 3.3%
- College graduate -- 1.4%
They also list the unemployment rate as of February 2010 as follows:
- Less than a high school diploma -- 15.6%
- High school graduate, no college -- 10.5%%
- Some college or associate's degree -- 8.0%
- College graduate -- 5.0%
Very interesting, wouldn't you say? What are your feelings on this issue?
I do believe that some college or an associates degree is a good option for many when you consider all the health care paraprofessional careers that do not require four years of college. You can become an LPN in two years. You can even sit for an RN test with a 2 year nursing program from some community colleges to get you into the field. Also, you do not need a college degree for a paralegal career or for many office administration jobs. I have a masters degree but in my chosen field of social work have about the lowest level of pay for a high level of education. Obviously, I did not go into the field for the money. And I am glad I was able to receive an advanced education regardless of this. I did this economically as some of it I paid for and some of it was a scholarship, and I paid off the remainder of student loans in my first two years on the job. This would be harder to do in today's economy. And if I had gone to a junior college to become an x-ray technician, for example, I could make twice the amount of money as I made when in social work.
Posted by: MaryW | April 30, 2011 at 07:46 AM
My views are close to your views. Not everyone is cut out for college, and not all jobs require a degree. We have a high school sophomore so I have been paying attention to this. There is a lot of hype and it is a big business so you need to do research. I think sometimes parents don't provide enough guidance. My child has a friend that was along on a lot of college visits with her sibling that is a senior. Said friend's big conclusion was that she wants to attend a college with a certain kind of building (brick not stone, or vice versa).
Posted by: Mary Kay | April 30, 2011 at 10:04 AM
Both of my kids have a degree. One is working in his field, (CPA), the other-not (Criminal Justice degree managing a pet store.) But they have jobs....
I am afraid the health tech/paraprofessional programs have grown too fast. Many new grads are having trouble finding jobs.
I think a Bachelors degree is not necessary for a decent job, but advanced training in your chosen field, not just a High School Diploma is a must!
Posted by: Dr Dean | April 30, 2011 at 10:42 AM
College is a big business that wants your money and will hand out degrees without thought to job prospects.They use the excuse that it is your responsibility to find that job with that degree. Enough said.
However there are jobs that require degrees in that study in college. Engineering, teaching, nursing etc. You will have difficulty finding a teaching position where you have not gone to some college in general education in order to meet the minimum requirements for that state licensing.
As for the worthness of going to college, definetly there are kids who are not ready, whether it be maturity (my son will be 18 in a month while alot of his friends will not be until nov. dec.) grades or whatever.
Maybe they need to work at clean toilets for a while to see for themselves that "Humm do I really want to be doing this for the rest of my life?"
I worked at Radio Shack for a summer and that told me I do not like retail. I also worked on a manufacturing line and that told me I do not want to work on an assembly line all my life.
Posted by: Matt | April 30, 2011 at 11:41 AM
My son was bright but was never a good, conscientious student so we transferred him into a vocational school available in our school district and for his last two years he took courses in learning to become an auto mechanic. After high school he became an apprentice at a Ford dealership. He was never very happy as an auto mechanic because of the great pressure to complete jobs in the fastest time possible in order to make more money for the company. He left the auto business and went into repairing very expensive, high quality vacuum pumps used in a wide selection of companies. This work was physically very demanding and after a back surgery he decided to quit repairing the pumps and go to work as a salesman. Now he has been working a long time for an international company based in Germany that makes the best vacuum pumps on the market. Unlike his father, he had great "People" skills and soon started doing very well as a salesman. He taught himself the necessary computer skills and also learned how to write nice business letters, and in 2010 he was named "Salesman of the Year". He frequently travels to Europe for trade shows and sales meetings and it works out well that nearly all of the Europeans he deals with can speak English very well. His job is very secure, he has a good salary, high bonuses, and a very generous 401K plan and has exceeded all of the expectations that I had for him while he was in high school. He was lucky with two real estate transactions, buying and selling at the perfect time, and now at 47 has a net worth very close to $1M and is happily married with a 10 year old daughter. As an added bonus he is now living in a condo near the beach that we no longer used ourselves and since we are leaving it to him in our will we don't charge him any rent but he pays all of the homeowner's fees and other expenses except for the property taxes. He also made many improvements to the condo, at his expense, and is now also a popular President of his Homeowner's Association, an unpaid job he has held for 5 or 6 years.
Posted by: Old Limey | April 30, 2011 at 12:53 PM
"If a man empties his purse into his head, no one can take it away from him. An investment in knowledge always pays the best interest."
- Benjamin Franklin
Posted by: MBTN | April 30, 2011 at 02:02 PM
In the past few years working in IT, I'd say 25% or less of the people I work with have degrees. Several of them make 80K a year or more (and not even in management). I don't make quite that much, but considering I don't have a degree I'm pretty thrilled with my salary. What is great about IT is most companies pay for the training and certifications, so you don't even have to drop 1 or 2 thousand on that, and it looks great on your resume. Unfortunately not requiring a degree really attracts a large share of people who have nothing else to do and like computers, and they are usually terrible. I would recommend it to anyone as a good field to get into without a degree, just don't be lazy about it.
Posted by: George | April 30, 2011 at 05:04 PM
I have two teen-age children, and I do believe that a 4 yr college degree should be the minimum education goal for most kids.
Although I'm sure it is true there are people without degrees who nevertheless have good jobs right now, the number of good job options for high school graduates has been decreasing steadily for decades--and I want my kids to be employable even 20-40 yrs from now. Even now, unemployment is much higher among those without a 4 year degree.
On the other hand, I don't think it really matters what school you go to, unless you're set on a professional career (doctor, lawyer etc). So the costs do not have to be that high! It's not expensive to attend your local state school or pick up some credits at your local community college while you live at home.
Attending college is NOT about living the life of a trust fund preppie, living in the dorms of an ivy league and partying every night--it is about applying and stretching yourself, and learning to function as an adult and independently, learning about the world and learning to use your brain.
I also strongly believe that real-life work experience is essential for a young person's growth during this time. As pointed out above, education is not and never has been a job training program--as always, you have to get your job training and figure out your career and do it on your own. You don't start looking for a job only when you graduate from college--you should already have been working in various fields before your graduate, so that when you do you have contacts and experience and you know what career you want to go into.
I have to laugh at the person above who implied that if he paid a lot of money to a college, then the college should guarantee him a job! Because that's like saying that if you just "show up" for work and sit at your desk a certain number of hours/years, you should automatically be retained forever and be paid and promoted on up the ladder for the rest of your life, no matter what you actually do while you are sitting at that desk. Like I tell my kids, life just doesn't work that way...!
Posted by: KH | May 01, 2011 at 07:04 AM
A 4 year degree is good to strive for if you are a good student or ambitious enough to do well and you pursue a major that actually has jobs. Debt should be minimized so that you don't get more loans than a years salary for the field you're pursuing.
I do agree with their opinion about getting a 2 year degree minimum. If you can't do a 4 year degree then at least getting 2 year will help you with job market in general or get you into a good skilled trade.
Posted by: Jim | May 01, 2011 at 01:14 PM
" An investment in knowledge always pays the best interest."
I wonder if Ben was thinking of C students getting psychology degrees from obscure over priced private liberal art schools?
Posted by: Jim | May 01, 2011 at 01:15 PM