Menu

graduate school debt nytimes article

Home General/Welcome graduate school debt nytimes article

  • portlandia portlandia 
    Participant
    Status: Physician
    Posts: 381
    Joined: 07/07/2017
    Earnest refinancing bonus
    I will tell him to get a job 

    Click to expand…

    What job? You told him to get a job. Done with hs, using free on the internet. Path to success. Don’t see career path.

    Click to expand…

    Seriously?! You don’t think there are ANY career paths that don’t involve a 4 year degree? Then you can’t be reasoned with my friend.

    #219841 Reply
    Avatar Tim 
    Participant
    Status: Accountant
    Posts: 2301
    Joined: 09/18/2018

    Third time. What job? Not everyone needs, no should go to college. My friend, it’s a combination of the abilities and desires of your kid. Entrepreneur or labor? The thought of “working” for a Fortune 500 hundred and relying on the “educational benefits” is unrealistic.
    “Go get a job” is frankly a dead end.
    An alternative plan would help a lot and greatly improve the odds. HS doesn’t prepare you to earn a living, it prepares you to survive, not thrive. Taking a HS college track course load and then not attend some type is a fail.
    Different tracks are available.

    #219955 Reply
    Liked by Anne
    Avatar nephron 
    Participant
    Status: Physician
    Posts: 67
    Joined: 05/09/2019

    I like the articles people posted about the myth of college education and about the Harvard doctor vs plumber showing how both have almost equal earning potential.  I don’t think that it is necessarily true though, it may be mathematically true, but the problem is, it is much easier to save 10% of your income making 185K vs saving 10% of your income making 33K.   At 33K, a much larger percentage of your income is directed towards everyday life expenses (eg a person making 33K will feel a small increase in gas prices much more then someone making 185K).   It is interesting if they do really come out mathematically equivalent if you average their earnings over a lifetime.  The doctor probably had 4-7 years of very low spending during school and residency which allowed them to spend more once they are an attending as well.   The other article makes good points that correlation does not equal causality.  That’s a common problem the media has with interpreting studies; just because not having a college degree is associated with a much lower salary doesn’t mean that it was the college degree that caused the person with a college degree to obtain much higher earnings, there are obviously a lot of confounding factors that contribute.   An obvious example being a drug addict is not going to go to college and not earn very much income, but will be counted in the “no college” column and be compared to someone who went to prep school and graduated from college.   Not a very good comparison if you are trying to determine the effects of college on income.   I suspect that if someone did a detailed analysis, they would be able to prove that going to college after subtracting out all the confounders and taking away the 4 years of income someone lost and the potential for investments compounding during that time was not a good financial deal for most people.   I still plan on sending my kids to college though, even if it is just a correlation, no sense in taking the risk, we do a lot of non-evidence based things in medicine as well.

    #219960 Reply
    Avatar nephron 
    Participant
    Status: Physician
    Posts: 67
    Joined: 05/09/2019

    A good randomized trial:   2 groups of children, one group gets randomized to college that is fully paid with a fully funded 529 plan that has 200K in it; the other group gets randomized into no college but gets 200K in a roth account.  I think that the kids that get the 200 K in a roth account will come out financially ahead in the long run.

    #219961 Reply
    Liked by portlandia
    Lordosis Lordosis 
    Participant
    Status: Physician
    Posts: 944
    Joined: 02/11/2019

    You need a third arm of kids who take the 200k and spend it on strippers and coke

    “Never let your sense of morals prevent you from doing what is right.”

    #219975 Reply
    Liked by Tim, StateOfMyHead
    Avatar StateOfMyHead 
    Participant
    Status: Advanced Practice Provider
    Posts: 81
    Joined: 01/01/2019

    I like the articles people posted about the myth of college education and about the Harvard doctor vs plumber showing how both have almost equal earning potential.  I don’t think that it is necessarily true though, it may be mathematically true, but the problem is, it is much easier to save 10% of your income making 185K vs saving 10% of your income making 33K.

    Click to expand…

    Whoa wait did the article say plumbers are earning $33k a year? Mine charges $95 an hour.

    #219993 Reply
    Zaphod Zaphod 
    Participant
    Status: Physician, Small Business Owner
    Posts: 5751
    Joined: 01/12/2016

    Pretty sure that’s what would happen to the no college arm. I’d bet against this all day long everyday. Seriously people, everyone on this board and you know is an example against this nonsense, and at this point that’s what it is.

    No struggling everyday person would not trade their struggles for yours. They would instantly choose what to do with 10k extra a month and whether to pay down their doctors mansion or take 4 more weeks a vacation.

    These are not things normal people have the luxury to consider. It’s starting to get offensive in here with the level of absurdity.

    Who is more likely to be living better at 50? Not struggling in retirement? To have lived a great life until then without concern and stress for everyday life issues?

    The doc that retires with a paltry couple mil and lived lavishly is not a failure and will still have a better retirement than 90%+ of people, and lived it up.

    #220005 Reply
    Liked by Panscan, ENT Doc, Anne
    Avatar AR 
    Participant
    Status: Physician
    Posts: 698
    Joined: 03/10/2016

    A good randomized trial:   2 groups of children, one group gets randomized to college that is fully paid with a fully funded 529 plan that has 200K in it; the other group gets randomized into no college but gets 200K in a roth account.  I think that the kids that get the 200 K in a roth account will come out financially ahead in the long run.

    Click to expand…

    I’d love to bet on the college kids as well.

    I’m not even sure what everyone is arguing about any more, though.

     

    #220007 Reply
    Liked by Zaphod, ENT Doc
    Avatar Tim 
    Participant
    Status: Accountant
    Posts: 2301
    Joined: 09/18/2018

    @zaphod,
    “The doc that retires with a paltry couple mil and lived lavishly is not a failure and will still have a better retirement than 90%+ of people, and lived it up.”

    https://smartasset.com/retirement/average-retirement-savings-are-you-normal

    The numbers being thrown around absurd for virtually all of the working population. The loan balances being thrown around are greater than the net worth or the cost of a house. They apply only to ultra high incomes or inherited wealth, yes the proverbial 1%. For 99% of the population, ain’t gonna happen. Including everyone’s kids. I certainly hope these aren’t the financial expectations anyone has for their children.

    #220010 Reply
    Liked by Zaphod
    Avatar Anne 
    Participant
    Status: Physician
    Posts: 938
    Joined: 11/07/2017

    Agree 1000% with Zaphod’s last comment.

    In addition, not everyone has the physical or mental attributes needed to succeed in a trade. I for one would be pretty useless without a college education. Based on my experience trying to learn handyman etc skills, i am certain I would be the worst plumber, welder, electrician in town. If someone is so inclined, roll with it and don’t make them feel less than for pursuing a trade. Some people will do better going to college, some people will be better off developing other skills. I don’t know that our current school system is set up to help kids figure that out in time to make the best decision, and I think the pressure for everyone to go to college and to look down on the alternatives is too strong.

    #220023 Reply
    Liked by Zaphod, Tim
    Avatar AR 
    Participant
    Status: Physician
    Posts: 698
    Joined: 03/10/2016

    Agree 1000% with Zaphod’s last comment.

    In addition, not everyone has the physical or mental attributes needed to succeed in a trade. I for one would be pretty useless without a college education. Based on my experience trying to learn handyman etc skills, i am certain I would be the worst plumber, welder, electrician in town. If someone is so inclined, roll with it and don’t make them feel less than for pursuing a trade. Some people will do better going to college, some people will be better off developing other skills. I don’t know that our current school system is set up to help kids figure that out in time to make the best decision, and I think the pressure for everyone to go to college and to look down on the alternatives is too strong.

    Click to expand…

    I don’t care how hopeless you think you are, I have absolutely no doubt if you spent as much time and effort studying plumbing as you did medicine, you would be a master plumber.

    Maybe others would pick it up more quickly and easily, but after 7+ yrs of significant effort, I’m sure you would be more than fine.

    #220041 Reply
    Avatar nephron 
    Participant
    Status: Physician
    Posts: 67
    Joined: 05/09/2019

    I can’t see how the person who went to college would win financially/mathematically  over the person who started with 200K in a Roth account.  Behavior economics aside, and just doing the math simply from a non-financial expert, assuming that as per the recent CNN article, a college grad makes $72,000 per year and a a non-college grad makes $32,000 per year:

    High school grad:

    Starts working at age 18, retires age 65, works for 47 years at a salary of $32,000/year, so makes a total income of $32,000 X47= $1,504,000, saves none of it.   Assuming that he doesn’t touch his Roth and does not save anything for retirement, and the Roth has a 6% annual rate of return, which would make the Roth account=$3,093,183 at age 65.   He converts the Roth to cash at age 65, spends it down until he dies at age 80.   Therefore, he has had a total of $4,597,183 and savings to spend over his 80 years of life.  Another way to think about it would be that he had $4,597,183/62=$74,248 per year on average to spend from age 18 to 80, obviously with more of it spent after age 65 when he spent down his Roth.

     

    College grad:

    Starts earning an income at age 22, earns $72,000 per year, retires at age 65, so total income=43 years X $72,000=$3,024,000.      He did not have a Roth at age 18, spent it all on college, just had cash to spend down from his income, so he had $3,024,000/62=$48,774 per year on average to spend from age 18-80.

     

    This is obviously an over-simplification of what happens, but it is an interesting thought exercise.   Again, I suspect that if the college grad and non-college grad were truly the same person and just randomized to one arm or the other, the income gap would be much less as the non-college grad is including income  or lack of income from the disabled, home-makers who did not want to entire the workforce, etc and not a reflection of someone motivated enough to go to college and graduate but was randomized not to vs the person randomized to go.

    https://www.cnn.com/2019/06/06/success/college-worth-it/index.html

    #220051 Reply
    Liked by portlandia
    portlandia portlandia 
    Participant
    Status: Physician
    Posts: 381
    Joined: 07/07/2017

    I can’t see how the person who went to college would win financially/mathematically  over the person who started with 200K in a Roth account.  Behavior economics aside, and just doing the math simply from a non-financial expert, assuming that as per the recent CNN article, a college grad makes $72,000 per year and a a non-college grad makes $32,000 per year:

    High school grad:

    Starts working at age 18, retires age 65, works for 47 years at a salary of $32,000/year, so makes a total income of $32,000 X47= $1,504,000, saves none of it.   Assuming that he doesn’t touch his Roth and does not save anything for retirement, and the Roth has a 6% annual rate of return, which would make the Roth account=$3,093,183 at age 65.   He converts the Roth to cash at age 65, spends it down until he dies at age 80.   Therefore, he has had a total of $4,597,183 and savings to spend over his 80 years of life.  Another way to think about it would be that he had $4,597,183/62=$74,248 per year on average to spend from age 18 to 65, obviously with more of it spent after age 65 when he spent down his Roth.

     

    College grad:

    Starts earning an income at age 22, earns $72,000 per year, retires at age 65, so total income=43 years X $72,000=$3,024,000.      He did not have a Roth at age 18, spent it all on college, just had cash to spend down from his income, so he had $3,024,000/62=$48,774 per year on average to spend from age 18-80.

     

    This is obviously an over-simplification of what happens, but it is an interesting thought exercise.   Again, I suspect that if the college grad and non-college grad were truly the same person and just randomized to one arm or the other, the income gap would be much less as the non-college grad is including income  or lack of income from the disabled, home-makers who did not want to entire the workforce, etc and not a reflection of someone motivated enough to go to college and graduate but was randomized not to vs the person randomized to go.

    https://www.cnn.com/2019/06/06/success/college-worth-it/index.html

    Click to expand…

    Obviously in the real world this calculation would get a bit more complex, but this sort of thought experiment is valuable to understand the opportunity costs associated with college. To get at a more detailed answer, (which I know you weren’t trying for) other factors would come into play, like the ability to invest the income difference for the higher wage earner, differential tax rates, etc.

    College has been great for countless people, myself included, but sadly there are many for whom it has been a financial disaster. With the astronomical costs of higher education today, it behooves any potential student to do their due diligence regarding the costs and potential benefits. I think that is something we all could agree on. 🙂

     

     

     

    #220061 Reply
    Liked by Tim, StateOfMyHead
    Avatar Tim 
    Participant
    Status: Accountant
    Posts: 2301
    Joined: 09/18/2018

    @portlandia,
    100% correct. Numbers themselves like medians and mean scratch the surface. After college, what is the career progression with opportunities for promotion and advancement differ drastically, thus the “proverbial corporate ladder “ comes into play. The distribution of compensation by job grade are drastically different by field. Some skills “learned” by book or experience are transferable and some become obsolete. With the huge cost, many of those taking on debt are going to lose.
    Some of those busted and tried but didn’t realize the risks. The benefits are sold and marketed to customers (students) with no regard to the hazards of failure. Many make bad choices unintentionally.
    Student loans provide a revenue stream for post grad education damaging many.

    #220101 Reply
    Liked by Zaphod

Reply To: graduate school debt nytimes article

In case of a glitch or error, please save your text elsewhere, clear browser cache, close browser, open browser and refresh the page.

Notifications Mark all as read  |  Clear