When Will a College Degree Pay Off?

It’s old news that college graduates make more money than Americans who bailed on their education after high school.

You don’t need a study to figure this out, but that hasn’t discouraged researchers from crunching the numbers anyway.

This week the College Board released a study, Education Pays 2010, that documents what advantages that a bachelor’s degree conveys.  Here are a few facts that I found particularly interesting:

The earnings gap between college grads and those who didn’t attend college has grown during the past decade.

In 2008, the median earnings for women between the ages of 25 and 34 with a bachelor’s degree or higher were 79% greater than for women that age with a high school diploma. For men the earnings premium for college grads was 74%. The earnings differentials were lower — 60% and 40% respectively a decade earlier.

What I found most fascinating was the length of time that the College Board says it takes before the median earnings of a college graduate exceeds that of a high school grad. When you take into account the head start that high school grads get in the workplace and the student loans that college grads must pay back, Americans earning a bachelor’s degree come out ahead about 11 years after leaving college. For many Americans that will be age 33.

For all you out there struggling to repay student loans, does this make you feel better?

Lynn O’Shaughnessy is the author of The College Solution, an Amazon bestseller, and she also blogs about college for CBSMoneyWatch and USNews.com.


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