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Higher Education = More Work and Crappy Return.

One thing the article I posted last week does not cover is this: realizing that a large portion of this is not just big screen tv’s or jewellery and cars that people can’t really afford, but that it is educational debt. It’s interesting how we’ve created a society where most often, the ‘smartest’ people are saddled with the biggest debt.
Think about it.

  • You spend 4-10 years getting a post secondary education they are up to their eye-balls in debt = Age 22-28 into the workforce
  • You spend the first 10 years of their career trying to pay for it. It makes zero sense = Age 32-38 finally out of debt
  • You’ve lost the first 15-20 years of all your disposable income when others have been plugging along working, for what?
  • You earn maybe another $50K a year to just lose half to taxes?

Then lucky you, you spend the next 20 years in a panic trying to make up for lost time climbing the ladder while everyone else just plugged along working.
So you make another $1,000,000 taxable dollars that your less educated peer made with a lesser salary.

It makes NO sense to me. Listen, I’m not saying go work at the Quickie Mart Einstein, and I am absolutely not saying don’t get a post-secondary education, what I’m saying is do it without taking on debt. Do whatever it takes to pay for your education as you go, work summers, evenings and weekends if that’s what it takes. Then bingo, the gift of making $50K more a year has it’s benefits, and those benefits can be seen right away.
Here’s the alternative.

  1. Graduate from high school.
  2. Work your tail off going to trade school, college or University for however long you’d like.
  3. Graduate at 22 DEBT FREE.

Spend the next 30 years in a lower tax bracket, investing the money that you would have used to pay interest and minimum payments on your school loan, if you had one.

Rough numbers with average yields, by my calculations translate to over $15,000,000 compared to the $1,000,000 above.

Hmmmmmm. Which one is better? What can I say, I’m one of those ‘educated people’, but I was lucky enough to not ever take a student loan, so my money has always been mine, and continues to be that way. Consider this if you are going to be a student, are one with debt, or you are a parent. Higher Education = More Work and Crappy Return.