What’s Your College Degree Worth?

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).

Useful links
2009 Highest Earning Degrees
CNBC 2010 Highest Earning Degrees

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

Imaginary Scenario
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.

Key Takeaways
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!


To receive updates on topics such as this one immediately as they are published, please subscribe to my blog by clicking on the link below:

Subscribe to My Money Blog via Email

Speak Your Mind


CommentLuv badge