As a fee-only financial planner, I spend time each morning reading about current events and trends that might impact my clients’ financial plans. Reading through news recently I stumbled on an article about more than a dozen large companies – think Apple, Google, Bank of America – that no longer require new employees to have a college degree. That’s a big trend shift from the past 20+ years.
When I was in high school the shift was just the opposite. At that time more and more companies – especially large well-known brands – were adding college degrees to their list of new-employee hire requirements. My parents presented it to my brother and me as a given. NOT going to college wasn’t even discussed.
Success without a degree?
Adding to the recent discussions is the fact that there are a growing number of high-paying jobs that don’t require degrees. I’m not talking about companies that have made a shift, but entire industries that you might not even have considered. Dozens of these jobs pay way over $50,000 per year.
There have always been outliers who’ve been tremendously successful without a degree. Tony Robbins, Mark Zuckerberg, Mary Kay, Richard Branson, Oprah Winfrey, and many others. But those have tended to be the exception rather than the rule.
According to government statistics, the average annual cost of attending college – tuition, room, board, books, etc – is pushing right up against $40k! Paying that much, especially for a family with multiple children can be a challenge. It takes diligent financial planning as I’ve mentioned here and here.
Is college worth the high cost?
Yes. Sometimes. But not always.
It largely depends on the degree and the specific employment the young adult is trying to pursue.
The most recent data I could find was from 2013, but in that year it was noted that only 27% of college graduates had a job related to their degree. Well, certainly for the 73% who didn’t – college wasn’t worth it!
A large part of the issue with graduates not working in their field is this: What 18-year-old knows what they want to do for the rest of their lives??
Even I changed majors in college. Thankfully I did it in my second year and most of my classes so far had been general topics that transferred to the new degree.
How do you decide?
There isn’t an easy answer, but every family should spend time discussing it. Brainstorm on their child’s (or young adult’s) natural interests to explore employment ideas. Then check out those career fields to see if a degree is required. REQUIRED.
Not, “it might help”, but actually needed.
You don’t know how many people I’ve spoken with who were considering or working on graduate degrees for fields that didn’t require it. Sure, it might help them progress faster once in the field. Or it might help them stand out in a competitive market. But getting a job in that field and working hard can also be a solid path to advancement. Certainly a much cheaper path!
What if your kids are young?
I’m not sure there has ever been an 8-year-old who knows what they want to do with their lives. Using age 8 as an example, with ten years still until the go-or-not decision, you have time to position yourself with options. Whether your child attends college or not, it’s ideal to be in a financial situation where you can cover all, or a large portion, of the cost if it does make sense for them to go.
Do you have kids, or are you planning to have kids? If you don’t have an estimate of what college might cost down the road (after inflation) then consider speaking with a financial planner about it. A good financial planner can not only let you know how much it will likely cost, but explain how much you’ll need to save each month to achieve that goal, and what your options are for investing those future college dollars.
If you don’t already have a fee-only CERTIFIED FINANCIAL PLANNER™ you’re working with, feel free to reach out and we can chat about it.