The following is a guest post from Phillip Reed. Phillip is associated with Westwood College in the Colorado area.
There are many ways one can look at higher education: you can look at it as a way of spending several years immersing yourself in the history, culture and philosophy of the world around you; you can look at it as an effective way of broadening your employment prospects; or you can look at is as a financial investment. It’s this last perspective that we will discuss here, as return on investment (ROI) is a significant issue in higher education today.
Thinking of higher education as a financial investment is important, because, like it or not, it’s expensive. Any expense of that magnitude should ideally have some lasting benefit in your life, and in this case that benefit is a substantially increased level of knowledge. While it would be difficult to argue a direct ROI from higher education, it’s clear enough that it can be achieved in an indirect way. That is to say, you pay a certain amount for the knowledge, that knowledge translates to a higher level of employment, and that employment brings you a larger sum than the amount you invested. Simple, no?
Again, though, that’s an ideal situation, and it’s not something that everybody can count on, or should count on. For those who are looking at education as an investment and not strictly as an opportunity for personal growth and enlightenment, some up-front planning and research is crucial.
Higher education, after all, can be expensive. And, as we know, high salaries are by no means guaranteed. It’s important, then, to weigh two things:
1) The Cost of the Education
2) The Potential Salary in a Given Field
So far, that’s straight forward enough. And, fortunately, you have a bit of wiggle room in both areas.
For starters, the cost of education can vary depending upon whether or not you qualify for grants, your place of residence, the nature of the institution (community college or online college are often significantly less expensive, for example), the speed with which you complete your degree, and other factors that are relatively within your control.
In terms of your potential salary, there’s a lot less control you can exercise. You can, however, understand that salary can increase over time, and by working hard and investing yourself more deeply in your work you can potentially expect your annual income to grow. If it doesn’t, you may be able to leverage yourself a better deal with a competitor or, depending upon your given field, by going into business for yourself.
This kind of versatility is not consistent across disciplines, so research yours in particular before you count on being able to write your own ticket. For instance, a computer programmer may well go into business for himself if he is not satisfied in his job in a particular company, but a medical assistant may not have that luxury. A computer programmer may also find himself in demand enough that he may be able to negotiate a better salary or benefits in return for staying with his current employer, while a clerk or receptionist may not enjoy the same element of irreplaceability, and can therefore expect a level of compensation determined by his or her employer.
When you stack up a rough cost against a rough expectation of payout, you’ll want to see the latter much greater than the former. If the former outweighs the latter, then you have a problem with your investment.
For instance, take a look at this article from Financial Highway. They highlight several majors that may not have an acceptable ROI in today’s economic climate, including Social Work, Liberal Arts, and Horticulture. (Sorry, horticulturalists…we didn’t create the list!) Of course they don’t delve into exactly how much a representative degree in these fields would cost…they couldn’t do that, as the possibilities are too vast to consider in a general article like this one. That’s the student’s job.
After all, ROI is relative. It may be true that the money you spend on a Criminal Justice degree at one college might not see its cost easily recouped, but a similar degree obtained at a less expensive school might just tip the scales a bit, and make the job that much more profitable.
For a sunnier counterbalance to the above list, check out this article as well. It’s a list of degrees with high ROI, and this time they do try to break it down by dollar and percentage. As always, you will need to do your own research (after all, they sure didn’t contact your college of choice and future employer to get this information!) but this might provide some food for thought when considering what to take into account when making your decision.
Weighing your options beforehand can help you to avoid regret and disappointment down the line. As unromantic as it might sound to say, a focus on potential ROI should be a deciding factor for those considering higher education for the sake of employment. For those who see college as a chance to grow as human beings, it’s less important…but anyone who wants to secure their future financially would do well to do their research up front, rather than struggle to make up for a lack of research later.