Finances & Money General

Why my college degree was worth the price

While many of you think your college degree was a big waste of money, usually because you’re doing nothing related to your degree, I get to tell you how my degree more than paid for itself.

I started college as a declared Accounting major, but in my senior year, decided that Accounting wasn’t for me. Thanks goodness. So I switched to a new degree (that only lasted a few years at my college) called Operations and Information Systems Management. The degree mainly focused on project management, inventory management, logistics and some computer stuff like database design and unix system administration.

Since I went to a state school, and paid in-state tuition (and lived off-campus), I estimate my degree cost me about $24,000 in tuition, and probably another $15k-20k in housing, food, etc. While my parents took out loans for the housing, and helped me buy food until I got on my feet with my first college job (at a computer lab), I paid for my own tuition and most of my non-rent bills. I will admit my parents had to pay out of pocket for my final class since I didn’t meet requirements to get a loan.

I’ll also admit that I promised my mom that I would pay back as much of the loans they took out for me as I could, and I’ve knocked a small dent in that loan my parents are carrying for me, but I still have a ways to go.

How my degree paid itself back within 5 years

I honestly don’t know what the normal degree payoff period is, but here’s how I did my math. I started at salary “X” out of college. Granted, that salary was double (or more) what people who stayed in my home town got, and I got excellent benefits with it. I could say that my degree paid off in year one, but that’s too easy.

So I started with X. After four years at my job, I had earned enough raises to be at X+$10,000, which we’ll call “Y”. I was almost halfway to payback! (although the loan itself was definitely not getting paid off yet). But it was time for me to leave, and I found a new job about 90 miles away. Unfortunately, I had to commute to this new job, but it garnered a nice boost of Y+$14,000, which we’ll call “Z”. If you’re keeping track, that’s a gain of $24,000 over 4 years, which is what I paid in tuition. However, I only stayed at that job for 5 months, so I didn’t get the full $14k. Surprisingly, though, in my next job change, I got Z+$10,000.

So in about 5 full years, I had gotten enough pay increases to virtually pay back my degree and then some. And in the last 4 years, the job market has been kind to me and I’ve gotten more and more increases; each normally coming at a job change, but sometimes with a nice internal raise.

More proof that college degrees pay

I think I’ve mentioned this before on this site, but I’ll say the story again. I started my first job at just shy of 23 years old. A coworker, 9 years my senior (making him 32), quickly became a trusted friend and we openly shared salaries with each other. We found that he was making about 20% more than me, but he had almost a decade of experience in IT, while I had none. You would think the gap would be much larger.

The reason the gap was so tight: My friend and colleague had no college education.

Fast forward to today. I’m now coworkers again with this friend as he helped get me my latest job (and got me out of federal contracting!). We still share salaries, but times have changed. We’ve both jumped around jobs, but we stayed in the same field, working on the same software.

I now have a Masters Degree. He still has no college degree.

Our salaries are currently less than 3% apart. And the thing is, while I was doing nothing and learning little in federal contracting, he was busting his butt and gaining skills in the real world.

After almost 10 years of work for me, 20 for him, only 3% separates our salaries.

Call it luck? Good fortune? Hard work? Skill? Call it what you will, but I truly believe that my B.S. and M.S. have helped catapult me 10 years ahead so that I’m on par with (and I’ll say even advanced beyond) my peer. We both started on the same project on the same software at the same time, yet I have virtually caught up to his salary in less than 10 years (really, we’ve been pretty close for years, but this is the closest).

Why do I tell you this? Because there’s so much more to a college degree than what you learn in the classroom. I’ve been lucky that SOME of my classes can be used in my field of work, but really it was the “learning how to learn”, discipline and motivation that college gave me that helped propel me to where I am today.

I’ll end with this, though. I will definitely say I am not excited to be working in IT. It has its rewards (mostly money and a cushy office job) and some little wins, but in the end, I’m not directly impacting lives. Now that we’ve gotten comfortable on my salary, I don’t know if I’ll ever get a chance to find my true calling, but I do many extracurricular charitable activities to keep me connected and down to earth, and maybe I’ll just have to live with that type of lifestyle.

So don’t let the naysayers tell you that college isn’t worth it. It all depends on where you go, what you major in, how much you spend and then what you do with that momentum you’ve built through your college years.

About the author

Clever Dude


  • I’m 25 and will finish my MBA at a top school next spring and already have a job lined up. It’s a good one. It’s going to take a while to pay back all the student loans, but like you, it’s thrown me years ahead of the rest of the pack. I’ll be making twice what any of my undergrad friends make. The masters degree is still alive and well, so long as you do the right ones and can see light at the end of that tunnel.

  • Hah! Did you happen to look at my site today good sir? Cuz if not, our brains sure do think alike 😉 Couldnt’ agree more my man, College is so f’ing good for you.

  • While I agree that the college degree is likely to pay off over a lifetime, you failed to consider a lot of stuff here.

    The primary consideration is that if you don’t go to college, you start your career 4-5 years earlier than if you choose to attend college. This is a major opportunity cost, particularly when you consider that this surplus could be invested, earning significant returns.

    Also, any savings spent on college could have instead been invested, earning nearly a lifetime of interest.

    Now, $24,000 in tuition is quite low, and likely why you’ll come out on top here.

    Let’s say that instead of a student job, you made $10,000 more doing something else. Over 4 years this would be $40,000.

    (I’m cheating a little here on interest earned during college, and on capital equivalence during work life, in order to make the numbers easier. The math is actually much nastier than what I’m doing here, and would probably make the salary equivalents slightly lower than what I calculate here.)

    So, the total opportunity cost of going to school was roughly $64,000.

    If you got a 10% average rate of return on that investment, then to cover both the interest and the capital you would need to make, on average, $6400+$1500=$7900 more per year than your counterparts to make up the difference. At a 5% rate of return, the post-college salary would need to be $4700 more per year, on average.

    Is your salary likely to be $5000-$8000 more on average, per year, than your colleagues who are the same age, but without a college degree? My guess would be yes. However, if you went to a private college where tuition was more like $100000 for 4 years, then you would need a benefit of more like $10000-$14000 more per year, which is less certain.

  • I’m 27, no degree (but I did go back to college this year) and all I’ve had were crap jobs because that’s all that I could get. I’ve tried getting entry level jobs but I can’t, you can’t get a career going without a degree. Working in CSR jobs isn’t a career.

    I went back to college as an accounting major, and I know deep in my soul that it will pay off, because I’ve been trying to get somewhere without a degree and I found out that you can’t. No way. It sucks that’s why I went back to college this year to see what I could get trained for.

    I’m tired of being poor. I’m tired of minimum wage. I wish I hadn’t been stupid when I was 18 and NOT dropped out of college. But at least this is a mistake that I can turn around and I can “make things right” by attending college now.

    However because I want a degree so badly, I am going to summer school, I can’t take my time like I want to with college. My aim is to finish college in 3 years because I want a better job to support myself with. A 27 year old thinks differently from an 18 year old. At this point I want savings, I want a 401k+ an IRA to save for my retirement.

    I live with my bf, (no kids) and I live in the midwest so the cost of living is very affordable here but the worry of not having enough savings, of not having retirement savings bothers me a lot. My bills are low and I have no debt but you know what, I want to make more money and have peace of mind. It sucks not having enough savings for now and for retirement.

    If anyone is reading this, please take college seriously.

  • I agree with you assessment of the value of a degree. I would like to point out, however, that in certain fields a degree is even more valuable. You are able to do a direct degree/no degree comparison in IT, because you are able to work in IT whether you have a degree or not. In my field, law, a law degree is the difference between a lawyer and no job at all. A degree is required to get your law license.

    When I left my previous job to return to law school, I was making about $35,000 per year. I took three years, paying net tuition (after scholarships) of about $20,000 per year. My first job out of law school paid about $90,000 per year. Needless to say, that degree was worth the price.

  • I don’t think my degree has fully paid off yet. I graduated in 2007 and took an entry level accounting job, a few months prior to graduating with a degree in Finance. I graduated with $28,000 in student debt, working at a job making $28,000 per year. In 3 years I’ve worked my way up to supervisor level making $41,000 per year, but I honestly don’t believe that my promotion was due to my education, but rather due to my hard work and intelligence. I’m a year of classes away from sitting for the CPA exam, and I’m sure once that is completed I will see some benefit.

    It’s interesting, when you have a college degree and no experience, you believe that everyone is looking for people with experience. When you have a lot of experience and no college degree, you believe that everyone is looking for people with degrees.

    Anyway, I know that my degree will eventually pay off, (if not the first one, then the 2nd one for sure), but sometimes it’s tough to see that far in advance.

  • Good for you! Most of my friends with accounting, IT or engineering degrees find that their education was worth it. I’m more of a liberal arts person, but I lucked out and my degree has been worth the cost, too. But that’s not always the case for people with “squishy” (as my Grandpa called my degree) majors.

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