Life is a gamble. When you visit an in person casino or you use an online casino website it is quite obvious that you are gambling. Everybody knows that sometimes you win and sometimes you lose, and if you are not willing to accept the fact that sometime you might lose, you should not gambling. Basic common sense.
Student loans are NOT gambling. They are investing in a person’s future. When I went to college, I ended up with around $30k in student loans, and it took me 10 years to pay it back (or maybe it was 12 years, because I deferred paying the loan back for the first two years out of college).
I received a Bachelor of Science in Computer Science and my starting salary back in the mid-90s was around $30k per year. So in my mind, having student loans around the level of a person’s entry level salary in their career choice is realistic.
How much student loans do students have with different levels of education?
The average student loan debt is $37,013. But that includes EVERYBODY, including people who went to medical school and law school and dental school and a host of other master’s and PhD level programs. So let’s break this down into the different levels:
- Undergraduate certificate programs (non-degree programs, trade schools, etc.) – $16,940
- Associate Degree Programs (2 years of college education) – $21,890
- Bachelor’s Degree Programs (4 years of college education) – $31,790
- Master’s Degree Programs (5 to 6 years of college education) – $70,070
- Doctoral Degree Programs (7 years of college education) – $118,360
- Professional Degree Holders (Doctors, Lawyers, etc., more than 7 years of college education) – $199,540
What Is The Entry Level Or Average Salary Of People With Different Educational Levels?
• Undergraduate certificate programs (non-degree programs, trade schools, etc.) – $38,248 (earn more than loans, but the first couple of years are very low paying)
• Associate Degree Programs (2 years of college education) – $32,700 (earn more than loans)
• Bachelor Degree Programs (4 years of college education) – (earn more than loans)
- Engineering – $69k
- Computer Science – $67k
- Math and Science – $62k
- Business – $57k
- Social Science – $57k
- Humanities – $56k
- Agriculture – $55k
- Communication – $52k
- Fine Arts – $48k
- Music – $48k
- Neuroscience – $48k
- Drama and Theater Arts – $44k
- Visual and Performing Arts – $42k
- Studio Arts – $41k
- Early Childhood Education – $39
• Master’s Degree Programs (5 to 6 years of college education) – (earn more)
- Business and Administration – $84k
- Computer Science – $82k
• Doctoral Degree Programs (7 years of college education) – $91k (do not earn more)
• Professional Degree Holders (Doctors, Lawyers, etc., more than 7 years of college education) – $199,540
- Doctor – $177 – $229 (not more, but salary high enough to afford higher student loan payments)
- Lawyer – $82k (definitely not more)
What Does This Mean?
If a person gets a job in their field, then the student loan was an investment into their future. When one compares a Bachelor’s degree student loan to a person’s entry level salary, the investment was worth it. Once you start to look at Master’s Degree programs and higher, one does have to start to ask themselves if the investment was worth it.
But this is assuming that a person is getting a degree in something where they can actually get a job when they are done. If a person invests in an education in Math, Science, Engineering, Computer Science, or even trade skills like Automotive or electrician or plumbing, the investment of debt to starting salary is worth it. The only outright exception is the lawyer where the starting salary is nowhere even close to the amount of student loan debt a person accumulates.
These are the worst paying college majors:
- Family and consumer science – $32k
- General Social Science – $34k
- Performing Arts – $34k
- Social Services – $35k
- Anthropology – $36k
- Early Childhood Education – $36k
- Theology and Religion – $36k
- Psychology – $37k
- Liberal Arts – $37k
- Foreign Language – $38k
- English Language – $38k
- Misc. Biological Science (people who do not get Master’s or Doctor’s degrees) – $38k
- Leisure and Hospitality – $38k
- Fine Arts – $38k
For comparison, a minimum wage job that pays $15 per hour (which is what a lot of people believe should be a standard minimum wage), comes out to $31k per year.
The overall average salary of Americans, regardless of education level is $35,805. The median wage for college grads is $52k compared to $30k for no college degree.
Does that mean that a person should not major in one of these low paying career choices? No, of course not. As long as you understand that your major is a low paying major, it will provide other life benefits, for example, happiness in doing your job or flexibility in working hours or does not require being employed fulltime, then those majors might be worth it, even if they are not high paying.
On the other hand, you don’t take out $70k in student loans if the expected entry level income is only around $32k. The math does not work out. You also can’t take out even $32k in student loans, if your life plans are to only work part time (for example, your life goal is to take care of your family and your career is just extra family income or something extra).
How Can People Reduce Their Ending Student Loans?
ROTC Program – Military Service
A person who enrolls in ROTC (Reserve Officer Training Program)or even serves in the military and then goes to college, is putting their life on the line in defense of their country. The government says thank you by paying for all of your college, if you join ROTC, and part of your college, if you enroll in the military and then go to college. Depending on how much education the government pays for, determines how long your end contract will be.
Regular military enrollment is 4 years, and then your qualify for the GI Bill. If you served in active duty for at least 36 months, then you get 100% coverage.
- Between 30 months and 36 months: 90% of the full benefit
- Between 24 months and 30 months: 80% of the full benefit
- Between 18 months and 24 months: 70% of the full benefit
- Between 6 months and 18 months: 60% of the full benefit
- Between 90 days and 6 months: 50% of the full benefit
- At least 30 days, but were discharged due to disability – 100% coverage
You can use your GI Benefits even while you are still on active duty.
With ROTC, you make the commitment to serve 8 years after college, but your military service will use your college education skills.
Army Student Loan Repayment Program
Under the Loan Repayment Program, the Army repays up to $50k of your current outstanding student loan debt. Soldiers who enlist in the Army Reserves for 6 years are eligible.
Goarmy.com has all of the information about education scholarships for regular reservists, ROTC, and the Army GI Bill. Although this website is specifically for the army, these benefits apply to any branch of the US Military (Army, Navy, Air Force, Marines, and Coast Guard). When is the US Border patrol not included in this? I have no idea. You would have to ask your local representative.