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Good, Grad School, Great: How I Increased My Value and Income With Advanced Education

Erik Learning, Personal Development and Lifestyle, Thoughts of a Mastermind 11 Comments

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When I was in high school, I didn’t realize I wanted to be financially free by the time I was 35. I didn’t realize I was going to try different entrepreneurial ventures and house hack for 2.5 years. There were many reasons why I picked my major in college, which were not for financial reasons.

That being said, I would be lying to you if I didn’t look at the average salary that various majors get coming out of college: Liberal Arts majors only make $30-40k on average out of college, and Science and Engineering students make $55-65k on average out of college.

Every decision we make in the present affects our future. Luckily, I looked at post-graduation salaries, and made a great decision to major in a quantitative discipline.

In this post, I will be discussing why I picked mathematics as my major in college, how graduate school has had a tremendous effect on my ability to earn and save, and how it’s helping my pursuit of financial independence.

Earning is the First Step to Pursuing Financial Independence

If your goal is financial independence, increasing your income is crucial to your success. If you want to draw down your savings at 4% a year, and want to live a life where you are spending $80,000 a year, you will need a nest egg of $2,000,000. To get to the 2 million dollar nest egg, you will need to earn, save, and invest to get there.

If I’m making $50,000 a year and saving $15,000 of it, it will take me many, many more years to reach a $2,000,000 nest egg than if I’m making $100,000 and saving $30,000.

Going back to my days in high school and early college, I was right in picking a major that helped me grow as a person and help me build my analytical abilities.

Why I Picked Mathematics for my Major in College

I love to problem solve and create things. I love to see the connections between objects that may not have an obvious relationship. Something about numbers and following a step-by-step problem solving process just clicks with me.

My senior year of high school, I took AP Calculus BC and fell in love with it. I really enjoyed every bit of it – especially the time series expansion of a function – where the majority of my classmates struggled with the concepts. I studied and studied and earned a 5 on the AP test, and was able to skip over the first 2 courses in college.

Finding a Job with a Math Major

Since I was able to pass over the first 2 calculus classes, this put me on the fast track to graduating. I came in as a sophomore because of my credits and was set to graduate in 3 years. As a 20 year old math major, with little to no applied knowledge, I knew I needed to get some more education.

I applied and was successful in getting into a Master’s of Financial Math program to further my education. At the same time, I wanted to test the job market. I was working as a bookkeeper at a hotel and restaurant management company making $16 an hour. At the very least, maybe I could increase my wage to $20-25 an hour and gain some additional skills.

When I was interviewing, I was a little bit disappointed. Many of the jobs for a mathematics undergrad paid in the $40-45k range, and were not all that interesting. Looking back, a computer science degree may have been the way to go, but I didn’t go with that.

I continued to work as a bookkeeper and started the Master’s program. A year later, I started interviewing again and successfully secured an offer at a highly reputable financial firm. My starting pay? $63,000 salary and a 8% bonus ($5k). In just 2 years of additional school, I’d increased my income by $20,000. I’d say that worked out to my advantage!

Fast Forward to 2018

Making money and increasing my income are 2 of my overarching goals at this stage in my life. With more money, I can put more money to work via investments. With more money in investments, I will grow my net worth. Then, with a growing net worth, in the future, I’ll have more options. And with more options, I’ll be able to do anything.

But that’s not why I want to share my successes with you. I want you to be able to achieve the same success as me – that’s why I write at The Mastermind Within.

I’d built a reputation as a high performer at work, and received solid raises over the past few years.  My knowledge is meaningless unless I share it with you.

As I wrote in my post, How I Earned Over $105,000 at Age 25, I earned over $88,000 from my day job. This year, I should earn closer to $100,000 from my day job, as my salary and bonus approach that number.

how I earned over $105,000 at age 25

Without this advanced education, I don’t think I would have been able to grow my salary so quickly from $16 an hour to $63,000 a year + an 8% bonus to $88,000 a year + a 10% bonus!

Why You Should Consider an Advanced Level of Education

By now, you probably know all the reasons not to go to grad school. If, after a bachelor’s degree, you are still “searching for yourself” or desperately avoiding the terror of the real-world job hunt, it may be better to read more of my posts and assess your goals 🙂

However, that doesn’t mean there aren’t good reasons to go to grad school.

A graduate-level education can enhance your lifestyle in a number of ways – especially if you now how to take advantage of advanced education.

Here are the major benefits of master degrees (and above) and a how-to guide for those who are possibly interested in higher education:

Big Benefits of Grad School

Graduate degrees are quite valuable, for both personal development and career enrichment. By obtaining a graduate degree, you can expect the following:

  • Personal growth.
    • You should grow intellectually, but through your experiences you might also enhance your emotional capabilities.
  • Wealth.
    • On average – across employment fields and U.S. state lines – Graduate degree-holders earn about 30 percent more than workers with merely a bachelor’s degree. (I was able to increase my salary $20,000 through my graduates studies!)
  • Connections.
  • Recognition.
    • Those with graduate degrees often enjoy higher social status than others. Master degrees and Ph.D.s are prestigious and earn praise and respect as a result.

Simple Steps to Grad School

If you are interested in going on to graduate school at some point, you can do so with the aid of the following tips:

Applications

Depending on where you hope to direct your career, the institution that provides your graduate degree may or may not matter. If you want to remain in academia, you should strive to obtain a degree from the highest-ranking school. Otherwise, if you intend to enter industry, then the knowledge and skills you gain – as well as the connections you make – are far more important.

Every school’s applications will vary, but in almost all situations, you will submit a resume (or CV) and a personal statement. You should channel most of your energy into this latter document because a memorable and well-written personal statement can forgive all sorts of mistakes in your education and work history.

Finally, you should start the applications process early, months before any deadlines. This ensures you relax and refine your application materials – and it lowers the likelihood of you skipping or forgetting any important elements, like exams or letters of recommendation.

Funding

Grad school is expensive – even more expensive than undergrad. Thus, unless you want to spend the rest of your life paying off student loans, you should seek alternative sources of funding wherever possible.

Scholarships and grants are widely offered for all sorts of grad programs. Additionally, you can reduce the price of applications by taking advantage of short-term deals, like a GMAT waiver for an MBA which eliminates the costs of studying and taking the entry exam.

Likely, you will need to find part-time employment to afford rent and groceries; you should start by looking for paying positions in your graduate program. Professors are often looking for aids or assistants to help instruct classes, grade papers, administer exams, or perform research.

I worked as a bookkeeper for 3 years during my undergrad and graduate studies. I was making between $12-16 an hour, and this helped me be able to leave school with only $8,000 in student loan debt.

Studies

Many of the skills you will cultivate to survive and thrive in grad school are applicable to your career after you complete your education. For example, it is vital that you gain excellent time management skills, which will help you juggle your studies with your work, your social life, and your other obligations. Additionally, you will need to acquire organization skills to keep your notes and assignments in order.

While grad school will be difficult, it can also be quite rewarding. As long as you balance your studies with other fun and fulfilling activities, you will come out of school in a much better spot than before: more valuable and with more skills than before.

Getting my Master’s degree allowed me to increase my income by $20,000 in 2 years, and then after being in the workplace for 3 years, another $30,000!

Conclusion

I’m not saying it’s necessary to go to grad school.

My point is learning doesn’t stop at high school or college.

Continuing your education through reading books or blog, going to grad school, or taking courses online can push you along on your path to achieving your goals.

Readers: what do you think about advanced education? Do you have a success story you’d like to share from more education?

Thanks for reading!

Erik

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Comments 11

  1. You were way ahead to be thinking about salaries and stuff while in college. I majored in history and econ – two majors that pretty much gave me no real job options (it also didn’t help that I graduated college in 2009 during the financial crisis). Majoring in two pretty much useless majors is what led me to go to law school in the first place.

    In the FI world, it seems like advanced education beyond college isn’t very common. Most likely because it delays your earning and puts you in the whole so much. Interesting to see someone think about grad school as a path to FI.

    For sure, student loans are the big thing to consider. Professional grad programs in particular are costly and put you deep in the hole in terms of time and savings. My wife is 31 now and essentially has never earned an income in her entire life. It’s a delayed path to FI for sure when you take the grad school route, but personally, I’m all for more education.

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      Thanks FP for stopping by.

      I’m one of the lucky ones I guess… yes, education is great, but I think going to grad school is completely up to the person – it depends – do you want to potentially increase your income, or what is your goal?

      Have a good one 🙂

  2. I really hope this pays off in the long run. Masters degrees are a huge time and money suck. I know the feeling all too well as I am going back for my MBA currently. When I get tired of studying I like to crunch the numbers on how much better off my portfolio would be if I invested instead of put that money toward tuition. But once the salary increases after the degree is received, it will make up for it going forward. Just need to power though it. Glad your graduate degree paid off for you!

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  3. I think that from a financial point a high paying four year degree beats most six year degrees. A mechanical engineer will make almost $150,000 in the two years before the math masters candidate draws his first paycheck. He will also be well on his way to much higher pay because he will always have two additional years of experience that the masters degree holder has lost forever. I think it was a great way for you to rehab a four year degree that wasn’t paying well enough but had you chosen engineering you’d have been that much farther along. But engineering is mind numbingly dull to many and it might have not been something you would have enjoyed. Sounds like you made a great choice for you and you are killing it. I did the four year engineering route and never looked back but I think I just got lucky.

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      Luckily for me, I was able to get to a 3 year degree 🙂

      Thanks Steve, and I’m really glad you were able to be successful in your career.

  4. Just like undergrad the value of grad school depends on the major. I have a relative pursuing a masters in sociology. I don’t have high hopes for her income post graduation, especially since she lacks actual experience. Conversely some jobs won’t let you in the door without an MBA, masters in engineering, or other degree.

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  5. Hi Erik, I’m a graduate business school teacher as a second career. Saying that I’m not biased. I’d love more students to enter grad school. But I think far to many do it for the wrong reasons or just no good reasons at all. If a grad school student can’t make a clear connection between the advanced degree and career prospects I wouldn’t recommend it. Tom

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      Thanks Tom for sharing your opinion on the matter. I completely agree and think it’s important for someone to make sure that they know exactly what their goals are, so that they aren’t regretting it in 5-10 years.

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