Don't Go to College to Make Money

You go to college to get educated. Unfortunately, most people go to college so they can make more money. This is a seriously flawed belief, yet the majority of Americans still cling to it.

Yes, people with degrees are often paid more than people who don't have degrees, especially in technical fields like engineering and medicine where you can't even get a job without a degree.

But if your goal is to make money, there are many better ways to go about doing it than going to college. Start a business in your spare time. Or teach yourself a skill that pays better than what you're currently doing. Both will give you substantially better ROI than college.

Here's a funny statistic. Did you know Stanford, California is ranked #1 by City Data for being the highest educated, lowest income city in the U.S.? Despite Stanford's reputation, the median household income is only $41,106.

Boulder, Colorado is just north of where I live. It is home to Colorado University, a mammoth-sized college campus. But did you know Boulder is ranked 25th on City Data's list? The median household income in Boulder is only $44,748.

As you can see, there's not a real great correlation between being highly educated and earning a lot of money. So why does this belief persist? I can only speculate. Perhaps it's because colleges and universities want us to go on believing the myth. After all, it is easier to sell earning power than it is to sell education.

But perhaps it's because of our natural aversion to risk. We are more comfortable with doing what everybody says to do (go to college) than doing what is actually more likely to pay off (start a business).

My own life experiences and my observations tell me that kids would be better off going to work after high school than going to college. What is college but a big party funded by parents who wish to live vicariously through their children? These "students" leave college worse off than when they enrolled.

As I was reading Walden a few months ago, I came across a passage that was particularly interesting. Even Thoreau was railing against colleges in the middle 1800s. Here is a passage worth considering...

[Students] should not play life, or study it merely, while the community supports them at this expensive game, but earnestly live it from beginning to end. How could youths better learn to live than by at once trying the experiment of living? [...] As with our colleges, so with a hundred "modern improvements"; there is an illusion about them; there is not always a positive advance. (Walden, pp. 41-42)

It was this same observation that helped to make Robert Kiyosaki famous. He published his best-selling story as Rich Dad Poor Dad. He told how one father was greatly educated but poor; the other "father" was uneducated but wealthy.

Ultimately, if it is wealth you want, skip college. Do as Thoreau suggests and get on with the experiment of living.

Comments

[John A. Manley]

Ryan, that VERY SAME quote was a big influence to me in my last year of high school.

I never went to college.

Never regretted it.

I look at a friend of mine... Great guy. Real smart. Spent 7-years getting a masters in music history. Only to get a job in a completely different field.

Makes more sense to find a high-earning career, get financially secure (or, even better, free) and then... if you want to study history, art, music, etc., go for it.

But, alas, as you point out, few college students aren't even thinking "education" no less "career."

One of your best posts. Walden is a special book.

John
http://www.realitycopywriting.com/free_audio_interviews

[Curtis Alexander]

Ryan,

Amen brother!

People look at me like I have moss growin out of my ears when I've said the same thing you just did...

...perhaps it's because I'm a pharmacist?

Of course, like you said, when it's medicine or engineering a degree is a must.

But some of the most successful people I know - personal friends - were not college material and knew it.

So they pursued their own business. Are happy and making good money.

If they had followed the "go to school and get a good education" mantra they would have wasted precious time and money.

And perhaps working in a field that they were not suited for simply because they spent tens of thousands on a degree and felt compelled to work in that field.

College, despite the popular opinion, is not a must. Often times it's an expensive escape from reality.

[Nick Dalton]

Don't the statistics of low median incomes in Stanford and Boulder point to teachers being underpaid, rather than college graduates earning a low salary? I assume that most college graduates don't stay and work in the town where they went to college. Although the latter is speculation on my part, since I never went to college myself.

Nick

[Ryan Healy]

John and Curtis - Great comments. Thank you.

Nick - Your observation may be correct. But I can't imagine more than 10% of Stanford's population being professors. The population was 13,315 at the 2000 census.

Besides, in most universities, professors earn a healthy salary... often $80K or more.

Boulder is a large city. Its population was 94,673 as of the year 2000. Professors make up only a small percentage. Based on this information, it would be hard to say professors are underpaid.

[otto]

Hi,

I think it's sad that when hiring people, it's common practice to put a lot of emphasis on formal education.
However, as anyone can tell, a lot of education takes place in the field. Especially when it comes to the "soft skills", such as dealing with people, getting things done, you learn a lot more by working.

I even had to un-learn: being used to having to follow the rules, you lose a lot of your creativity. Solving problems creatively is one of the biggest advantages you can have in business.

And yes, I am writing this in the knowledge that my daughter will start school in September (here in Belgium, they can start at age 2.5!)

Otto

[Sudheendra]

Ryan, I know what you're talking about. I'm an engineer myself.

These days, students are attracted to certain colleges and universities not because they like the courses being offered there...but because they're guaranteed a job when they pass out.

People should continue education only if they really intend to learn something...and not merely for getting a job.

[Ben Settle]

Here's a taste, I think, of what the future holds as far as the value of a college degree is concerned:

http://voxday.blogspot.com/2007/07/college-is-waste.html

Ben

[John Holzmann]

A couple of errors in your reasoning with respect to Stanford, at least (since I used to live there).

Stanford, California 94305 is the university campus itself. I'm astonished that the residents of a university campus--profs (who live on campus), graduate students AND undergraduates, together, average $41,000+ in annual household income. I'd say that's astonishingly good.

As for Boulder: what's the student population within the entire census? My guess: the numbers are skewed dramatically DOWN due to the full-time student population. . . .

FWIW.

[Megaan]

I resound the "amen!" to this post. Thank you! It is encouraging to know I am not the only one with this viewpoint. I have not gone to college (I am 23) and if life leads me to a point where it would be wise, I wouldn't mind going, but at the moment do not have the intention because I don't know what I want to study, and even if I did I refuse to do it with debt. Anyway... I have had more than a couple judgmental responses to these choices in my life and I think some have 'given up' on me. So far I do not regret it and my life has not been "less" for it, as far as I know.
However, how do you start a business without any college? I have thought of this a few times but do not know anything about how to start, and I thought you had to have college in order to start?
Advice would be welcomed!
Thank you for this post!

[Ryan Healy]

John - Great observation. I had assumed students wouldn't be counted in a census as residents of their college town but of their home town. I do not know the details of how the census works.

By the way, in 2003 and 2004 there were approximately 29,500 students enrolled at Colorado University in Boulder.

Megaan - You do not have to have any type of education to start a business in the U.S. You simply decide who you will sell to, what you will sell to them, and begin.

You can be a sole proprietorship to start and transition to an LLC later. You will need some way to account for business expenses and earnings so that you can pay the income tax.

[Me]

What you're saying seems to make some sense. After all, after you graduate, you'll be incurring a huge debt to pay back your college loans, not to mention paying a mortgage if you want a house.

But, where do you get the knowledge to know how start and run a business and know how to do all the things nessecary? Bill Gates went to Harvard, but never graduated and he's the richest person in the world, but I think he got lucky in the sense that he got a good deal with IBM on windows and DOS and has been able to virtually monopolize the operating system market. Eminem never even graduated high school, but again he got lucky too.

Plus, you can't go to business school if you don't graduate from college, although that will put you into further debt

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