One of the most daunting tasks upon teenagers entering college (and their parents I suppose) is deciding which degree/career to pursue.
For the most part, I feel that there is already enough advice on this topic floating around the internet and college campuses. It is well know that students should pick a degree/career that is 1) something they will enjoy and 2) something that will provide value to society. It is also known that there are certain careers/degrees that pay more than others (see links below).
However, what I do NOT see nearly enough of is guidance on the financial ramifications of the fact that in the real world, multiple types of degrees can perform similar and/or the same job. This idea was never really brought up to me as I was going through school.
To shed light on what I am referring to, let’s look at an example.
As it says at the top of my blog, I work in the pharmeceutical industry. In my current position, I work with a mix of biomedical engineers, chemical engineers, electrical engineers, and civil engineers. Interesting mix eh for people performing a similar job?
Looking at the “2009 Highest Earning Degrees” link above, we can find the highest and lowest average starting salaries for these degrees:
- Biomedical Engineering – $54,158
- Chemical Engineering – $64,902
Let’s now assume that two engineers graduate with the degrees above at age 22. They work until they are age 65, earning a 10% raise every year (they are STELLAR workers). Each year, the engineers contribute 15% of their salary to their retirement accounts.
Assuming the standard return of 12.4% on these contributions and that the above pattern continues, the engineers have the following amounts at retirement:
- Biomedical Engineer – $31,190,995.64
- Chemical Engineer – $37,378,743.66
As you can see, this results in a difference of about $6 MM.
Basically, I am trying to stress the point that obtaining a certain degree doesn’t restrict you to single job. And, to that same end, if there is a similar field (that you could still enjoy learning about) that will end up paying more money, it is at least worth considering!
Keep on learning!
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