About me Early Retirement Journey Updates and Reports

How My Income Skyrocketed and Net Worth Plummeted with My Education

Welcome back to My Early Retirement Journey! I’m so glad you’re here. So we’ve all heard it from one source or another that one of the best reasons to graduate high school (and eventually college) is not just for the sake of furthering your education, or accomplishing a goal, but for the promise of a higher salary. But is it true? And at what cost?

The data

A recent report by the Bureau of Labor Statistics did in fact find that high school graduates made on average about $400 more per week than their non-diploma holding counterparts.

COHORT MEDIAN WEEKLY SALARY ANNUALLY
NO H.S. Diploma $515 $26,780
H.S. Diploma $718 $37,336
Bachelor’s degree $1,189 $61,828
Advanced degree $1,451 $75,452

After simplifying some of the data from that report into a chart for comparison, it is easy to see that statistically, salary does increase as education increases. Conceivably, a high school dropout can reasonably expect to make one-third the salary of someone with an advanced degree. Naturally there are those who defy expectations and you might be one of them, but probably not.

Sometimes you’ll even see these cohorts working in the same place. For example a medical assistant at a private practice; or a pharmacy tech at a retail pharmacy;  or a receptionist at a law practice. Is there anything worse than slogging away the same number of hours at the same place, and being paid far less?

My story

Statistics don’t often tell the whole story.  They are just a compilation of data points after all. Given all the jobs I’ve had and the degrees I’ve earned, I was curious to trend just how much my salary did change with educational advancement.  And at what cost. Here’s what the data shows for my story.

No high school diploma

I got my first job in middle school. I used to babysit for my best friend’s little brother after school. I was in middle school from 1995 to 1997. During that time frame, I made between $5 and $5.15 an hour babysitting.

In high school, I used to work at my church answering the phones one to two hours a week. I made $5.15 an hour. I did that for a year before we moved. The summer before my senior year of high school, I wanted to go to a dance camp. After applying for “nicer” jobs in the mall, I got a job waitressing at a local diner making about $3.00 an hour (not including tips).  After I made the $600 I needed for dance camp, I quit. I suppose you could say at an early age, I knew long-term work was not for me. I was in high school from 1997 to 2001 and graduated in 2001 (debt-free).

I never worked full time before I graduated from high school. I don’t think work permits even allow that for child workers.

The breakdown

My range: $3.00 – $5.15/hr

Median: $4.08/hr

Median weekly (if full time): $163/wk

Annually (if full time): $8,476

High school diploma years

I graduated from high school in 2001 and started college about six weeks later. I was accepted into an early matriculation program, and I was ready to leave my hometown.  I made it through the summer program debt-free because the program was private grant funded. I got through fall break of my first semester of college, and it turned out I didn’t have the right immigration status to qualify for federal funding. Surprise! I couldn’t afford to go back.

Between 2001 and 2004, I had three jobs (at different times). Two were part-time and one was full-time. My first job was at a hot dog stand in the mall. I finally got a mall job! I was making $5.15 an hour part-time. Then my brother referred me for a data entry job at his company. I started off making $9/hr and ended at $12/hr. I was rich! The company went bankrupt a couple years later, and we were all laid off.

Then I got a seasonal job at my community college’s book store. I was making $7.50/hr for the spring rush.  Somewhere in there I also signed up with a temp agency, making on average about $10/ hr.

In 2004, with the help of Google (and God), I successfully applied for and was granted political asylum by the United States. That’s the short version. Asylees qualify for federal funding. I could go back to school! Back in college, I had a work-study job that paid $5.25/hr working at the front desk of a 24-hour desk of one of my college’s residence halls.

In the summer, I worked at a residential summer camp. They paid us $2,500 lump sum for 3 weeks (12-hr days).  Because of Hurricane Katrina, I spent one semester at another college and worked at their campus grocery store making $6/hr.

The breakdown

My range: $5.15 – $13.89/hr

Mean: (5.15 + 9 + 12 + 7.50 + 10+ 5.25 + 13.89 + 6)/ 8 = $8.50/hr

Weekly (if full time): $344/wk

Annually (if full time): $17,888

 

Postgrad years

I had no job prospects and hadn’t even started looking before it was time to graduate. I even missed my college graduation. It just snuck up on me. I guess you had to order tickets. I don’t know. Former President Clinton and Former President George H.W. Bush were there so maybe that’s why. I graduated in 2006 and went straight to graduate school, so I don’t know what the salary was for bachelor’s degree only.

Oh wait, yes I do!

For about three months in graduate school, I worked part-time at Blockbuster making $7.50/hr. That was fun. Awe. Remember Blockbuster.

I did a one year Master’s degree and got a teaching certificate to boot. I graduated that spring in 2007 and didn’t go into teaching right away.  I moved to Hollywood and this is where it gets sticky.  I fully intended to get a full-time job, but with limited experience, no connections, and no desire to be a teacher, this turned out to be harder than expected. However, if ever one wanted to thrive in the gig-economy, Hollywood is the place to do that.

I lived in Los Angeles County or adjacent from 2007 to 2009. While there I held all sorts of part-time gigs and some that paid no money. I halfheartedly tried to join the entertainment industry, hence the unpaid labors of love on different production sets. As a tutor, I made anywhere from $30 to $50/hr. As a substitute teacher I made $135/ day.  As an extra or wardrobe assistant, I made $100/day for a 12-hour day (and free food).

After a couple years of no health insurance and mounting debt, I decided to give full-time teaching one last try. That lasted for a semester at $23/hr.

I moved back to suburban D.C. and signed back up with the temp agency at $10/hr until my aunt referred me for a job at her company. From late 2009 to mid-2011, I made $18/hr as a human resources assistant. Then I went back to school to amass the remainder of my enormous student loan debt.

The breakdown

My range: $7.50 – $50/hr

Mean: (7.50 +30 + 50 + 16.88 + 8.33 +23 +10 +18 )/ 8 = $20.46/hr

Weekly (if full time): $818/wk

Annually (if full time): $42,557

Post post-graduate

I went back to school and got a professional degree. From 2011 to 2015, I amassed enormous student loan debt and chose not to work. My mentality was that I would have to work for the rest of my life and a minimum wage job during my degree program wasn’t going to change that. Had I known FIRE was a possibility, perhaps my approach would have been different. As many before me have said, financial independence was not a part of any of my degree programs’ curricula. I was not financially woke, as the young kids say.

I graduated in 2015 and was licensed soon after getting my diploma in the mail. I didn’t attend this graduation ceremony either. I don’t know what my problem is. However, this time I started my job hunt early. I got my first full-time job in my profession before I even graduated after one of my classmates referred me. I started at $41/hr and three years later I’m at $44/hr.

The breakdown

My range: $41 – 44/hr

Median: $42.50/ hr

Weekly: $1,700/wk

Annually: $88,400

 

Effect of education on my net worth

The math for this is simple. I had no concept of financial independence until December 2017. I didn’t know it as a concept in abstract or reality. I came to America to escape civil unrest in my country and get a better education which was supposed to give me a better life. It was to be had at all costs.  I obviously started and ended adolescence with no debt. Now in my mid-30s, I have six-figure savings that are outweighed by my six-figure debt.  Ostensibly, I achieved my objective. I got a great education three times over and it has afforded me a better life across almost all counts.  Financial independence will just have to be part of my second act.

Net worth breakdown

H.S. graduation:  +$1,200 in gift money

College graduation:  -$5,000 in debt

Graduate degree graduation: -$60,000 in debt

Professional degree graduation:  -$300,000 in debt

Professional degree + 3 years of full-time employment: – $300,000 (debt) + $100,000 (savings) = -$200,000 (net worth)

The verdict

So did my salary really increase with education as promised? Let’s look at the data.

SINGLE GIRL AVERAGE WEEKLY SALARY ANNUALLY
NO H.S. Diploma $163 $8,476
H.S. Diploma $344 $17,888
Master’s Degree $818 $42,557
Professional Degree $1,700 $88,400


I am making 10x as much with an advanced degree as I was with no high school diploma. So, I would say that is a resounding yes.

One question to myself when I started this post was something like this: Yes, I am making a respectable salary now, but was it worth the monumental student loan debt it took to get here? In this moment, I would say yes. Shocker, I know!

What you should take away from this

I like to tell the truth as plainly as possible because I too have fallen for the smoke and mirrors show in just about every aspect of my life. So as any college graduate between 2006 and 2010 will tell you, having a college degree doesn’t guarantee a job with a great salary. More than a few of my undergraduate classmates found themselves slinging coffee for a few years after graduation until they either found themselves; found their calling; found a network to plug into; or got enough experience to get a better job. Some like me skipped the under-employment line and headed straight for another degree program.

Yes, dear one, that diploma, high school or college, does not come with a job offer stapled to the back, but it does buy you a place in the race. Admittedly, it’s a race from which a growing vocal minority of people is now actively trying to sideline, trading in their badges for spectacles.  Nonetheless, unless you have the next great idea or super-talent, furthering your education wisely is a pretty good bet.

 

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2 Comments

  1. Great post. I have heard many times that I education increases income but I hate debt. With an unstable economy any one of us can lose everything almost overnight. I’m afraid that if I become unemployed again, I won’t be able to pay them. Then again, I’m working towards financial freedom with my blog.

    1. Thanks, Andy. I enjoyed writing it. I hope your blog can bring you closer to financial freedom. One benefit of student loans is you can ask for forbearance in times of hardship. So for now it’s not a huge obstacle on my path to financial freedom.

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