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How Much More Do You Make with a College Degree?

College ain’t cheap, so do those student loans really pay off?

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A college degree doesn’t really matter if you have the vision and ambition of Steve Jobs, Bill Gates, and Richard Branson, can dance and sing like Beyonce and Rihanna, or are a Kardashian. 

When you look at the wealthiest people in the world, most of them are college drop-outs, including one of the most successful women in the world, Oprah Winfrey. 

These folks didn’t care about a college degree. As it turned out, they had a greater vision. Lucky for them, their backup plan worked!  

However, the majority of these successful entrepreneurs hired people with college degrees to help them get where they are today—on top of the world!

In case you don’t have a plan B

If you don’t have a backup plan like Oprah, don’t despair! Billionaires and business leaders without any college education make up just 6% of highly successful Americans.

If your plans for the future don’t include being a celebrity, chances are you will go to college, and college is fun! It also provides you with knowledge and guidance, helping you choose the right path in your life and career. 

However, most aspiring students don’t realize at the time that the world after college isn’t a land of milk and honey. Jobs are hard to find, and when graduates eventually land one, it’s rarely what they wanted or studied for. 

Furthermore, as the price of higher education rises, many students are left wondering whether college is really worth it. Questions like “Will I be able to pay off my student loan?”, “Will a college degree affect my income?” or “Is it just a waste of my time?” are common among many students (and their parents, of course).

Here’s a fact, though: according to the U.S. Bureau of Labor Statistics (BLS), people with higher education earn a lot more than those with a high school diploma and those who opt for college courses. 

The BLS further found that people with no high school diploma have a median annual income of $30,784. That’s not all. People with less than a high school diploma are also less likely to find a job—the unemployment rate is 5.4%.

According to reports by the New York Fed, the average annual earnings of college degree holders reach $78,000, while those with no high school degree make on average $45,000 per year.

So, not having a plan B and enrolling in college may eventually work out just fine. 

Does having a college degree pay off?

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The National Center for Education Statistics found that Americans aged 25 to 34 who held a master’s or a higher degree had median annual earnings of $69,700 in 2020 versus $59,600 for individuals with bachelor’s degrees. 

Here’s an unfortunate statistic: male graduate degree holders make $1.5 million more in median earnings over their lifetime compared to high school graduates, while their female counterparts earn much less, that is, $1.1 million more. It should be noted that pay depends on the field of study: Some degrees are just more valuable than others. 

If you’re still wondering whether going to college is worth it, here is some more good news: According to the New York Fed, individuals with college degrees will make, on average, 14% more than what they invested in their college education. 

Finally, people with any kind of degree, even those with college credits, earn more money than those with no degree at all. So, does a college degree pay off? The answer: yes, it does. Bonus if you like your job.

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