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The Economics of a Degree - The Minuteman
Recently there have been a couple posts regarding higher education and student loans on a blog I frequent. The wife and I having both recently graduated from a four year university thought we would provide some extra input about our observations. I graduated from Washington State University with a BS in Electrical Engineering. Starting salary for a BS averages about $60K, MS $71K, and a Ph.D. $88k nationally. The 5 years it took me to earn my degree cost approximately $90K total. I could have taken a job as a CCNA immediately out of high school and made about $30K per year. So, for 5 years in school, I spent approximately $90,000 and also lost an additional $30,000 plus raises for gained experience, figure at the end it would have been about $34,500. So combining the opportunity cost, and the actual cost of my degree I’m in the hole approximately $250,000 dollars for my engineering degree. Though I also am a little bit further off than most since I also had my CCNA, we could use a lower salary in the $18,000 range and it still comes in at $185,000. Using the average BSEE salary, it would take me 14 years before I broke even with my earning power as a CCNA because of the debt. This approximation does not take into account full promotions, it just assumes an annual 3.5% pay increase per year. Continue reading →
TMM