Return on Education Investment
What's Your ROEI (Return on Education Investment)?
Are you thinking of returning to school, yet put off by the exorbitant tuition bill? Well, don’t shy away just yet. Student loan debt has long been considered the healthiest type of debt for a reason. That’s because higher education is an investment in yourself. But what, you may ask, is its rate of return? Read on to find out. (Hint - it may be higher than you think.)
Learn More, Earn More
Depending on your industry, the return on your education investment can be substantial. According to latest U.S. Census Bureau statistics, the median annual income earned by college graduates is $51,554. Compare that with the $60,514 garnered by those with a master’s. Ph.D.s average $77,445, while those holding professional degrees, including lawyers and doctors, earn $97,443 on average. And within each degree level, specializing can increase your ROEI. For example, a bachelor’s degree in nursing will generate a 20 percent ROEI; in business, 18 percent; and in information technology, 24 percent.
“Education pays off in so many ways, such as more employment opportunities and career options,” says Sherry Proper, the director of financial aid at Allegheny College (Meadville, PA) and author of “The Everything Paying-for-College Book.” It’s important to think of education as an investment, not an expenditure, she says. “Some people who are concerned about going into debt to finance a college education don’t hesitate to go into debt to drive a more expensive car or pay outrageous rent on a fancy apartment... but those things depreciate in value.” Education, on the other hand, she says, is a high-yield investment.
Proper has seen firsthand how education can enhance a person’s lifestyle. She grew up in a time when “you either had money to go to college, or you didn’t.” She didn’t. And so, when her children were small and she returned to work, her career options were limited. In 1987, upon being hired by Allegheny College as a secretary, she enrolled in classes. In the years that followed, she and her two sons would sit at the dining room table together, doing homework. It was a wonderful bonding experience, Proper says. Her husband was very supportive; he would supply snacks and play with the boys while Proper was studying. By the time her two sons reached high-school age, Proper was a proud college graduate, with a bachelor’s in mathematics to show for her efforts.
Going back to school wasn’t easy, though. As an older student, Proper had a hard time feeling comfortable in the classroom. Since she was at a different stage in her life and didn’t live in the residence halls, the social adjustment was difficult. With time, she realized that her concerns about “not fitting in” were all in her head. She forced herself to participate in class discussions. “The younger students actually seemed to like me because of the different viewpoints I had as a result of my age and life experiences,” she says.
Another challenge many adult students face is having to balance schoolwork with family responsibilities and full-time work. “Sometimes I joke that my degrees are really in ‘time management,’ ” Proper says. She stopped watching TV regularly, which helped free up some time.
Spurred by her own success, Proper decided to pursue an evening and weekend MBA program at Penn State Behrend a few years later. As a result, she received a promotion in 2004, along with a higher-paying position. Her liberal arts background deepened her appreciation for life. “My husband says I analyze movies now,” Proper jokes.
Bring on That Raise
Eighty-six percent of Walden University alumni agreed or strongly agreed with the statement, “My Walden degree improved my compensation level.” Barb Scherer, a full-time mother of three who works full-time at Akron General Medical Center, is one of them. She found it most efficient to further her education from the comfort of her home. She’s currently finishing up her final courses in Walden’s online Masters of Science in Nursing program, but she has already seen results. In December 2005, she received a promotion to director of nursing and patient services at Akron, along with a salary hike.
Juggling three full-time positions can be trying at times, but Scherer handles it with ease. “Once you become a mom, you develop a knack for multi-tasking,” she says. Instead of trying to achieve “balance,” Scherer prefers to focus on prioritizing her responsibilities, whether on a day-to-day or hour-by-hour basis. If she has to stay late at work one evening, she’ll devote extra quality time to her family the next night.
“Don’t be afraid to ask for help, whether it’s help at work, help with the family or with school,” she advises. In addition to the support she receives from her husband, her parents and sister–who live half-an-hour away–regularly help out by taking the kids for a weekend when Scherer has a big paper due. In addition, she and a neighbor–who is also pursuing a master’s through Walden University–take turns watching each other’s children.
Come October, Scherer will have a lot more time on her hands. She and her family are already planning a celebratory trip to Disney World for next year. Her kids deserve it, she says.
A Boost of Confidence
For a project manager at Delta Airlines, pursuing an MBA improved Dave Moake's quality of life and boosted his self-confidence. When he felt he had hit a glass ceiling at work and found himself disagreeing with his boss, Moake set out on a 20-month MBA program at the Coles College of Business at Kennesaw State University. It was almost a right of passage, as several of Moake's colleagues already had an MBA under their belts.
Inspired by the leadership focus of the program, Moake started his own consulting business, Eggli Group, based in Atlanta, GA, in 2004. Tuition for the program was roughly $45,000, and he’s still paying off his student loans. But oftentimes, financial calculations and cost-benefit analysis can overshadow the benefits of education, the most prominent being self-awareness and that boost of confidence, he says.
“Confidence changes behavior. I am confident we can deliver, and our clients sense that.” As his business expands, Moake has pulled together a team he’s proud of. “I feel privileged to work with the people I’m working with,” he says. “They’re people I trust, who are strong in areas that are not my strength.”
Strong Support System
Sometimes, all it takes is a push from a friend. When Rosemary Bonacci was thinking about going back to school for a master’s in public communications (an early 50th birthday present), it was her long-time friend and co-worker at the Sitrin Medical Rehabilitation Center–Christina Leogrande–who nudged her to actually apply. The two supported each other, sharing the 200-mile commute to The College of St. Rose one or two nights a week for four years.
Bonacci didn’t take a vacation in four years and got used to doing laundry at 5 a.m. “Just when my mortgage was getting to the point where I could see the light at the end of the tunnel, I remortgaged my home to pay the $20,000+ in tuition, books, tolls, and gas... but it was worth every penny,” she says.
Now, having gone back to school and honed her skills, she no longer feels rusty. “I am more in control now and feel a renewed excitement about my job,” she says. Upon graduation, she received a raise from her boss, along with renewed respect from her colleagues. Her next goal? Teaching as an adjunct professor on a college level. “There are no age limits to learning. This experience made me more focused, stronger, and better able to meet a challenge.”
Author bio:Tamar Snyder is currently pursuing her master's at Columbia's Graduate School of Journalism. Her work has appeared in the Staten Island Advance, the New York Times, The Jewish Week, and elsewhere.
By Tamar Snyder
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