More than ever, students have to consider the
return on investment of their degrees, and that means factoring in the average salary of that degree. Financial services company Earnest crunched some data to rank the graduate degrees that pay off fastest.
Going to grad school is both time-consuming and expensive, so it’s not a decision to make lightly.… Read more Read more
Earnest analyzed data to see which degrees led to the most and least student debt, then compared that to average earnings after college. Among other programs, they looked at MDs (medicine), DDS (dentistry), Pharm D (pharmacy), MBA (business administration), JDs (law), Masters in Science or Engineering, and Masters in Arts. While some degrees may pay off more over time, they wanted to look at the degrees that helped students get out of debt the fastest.
They divided average debt by average (self-reported) income to come up with a debt-to-income ratio for each degree. If the debt-to-income ratio is less than 1, that means it took respondents less than a year to outearn their degree. If the ratio is over 1, that means the cost of the degree was more than the average starting salary. MBAs had the lowest debt-to-income ratio, followed by Masters of Science or Engineering. Theoretically, the idea is that these workers could pay off their debt faster, considering their average debt and average income. Here’s what they found overall:
It should go without saying, but this is a very general snapshot that’s based on self-reported salary data, so take the numbers for what they’re worth: a broad view. There are a lot of other variables to consider. For example, Earnest also found that school reputation played a big difference:
Across a variety of disciplines, professionals who graduate from higher-ranked schools begin their careers with less debt relative to their income. And for the most part, this trend is still apparent a decade after graduation. There’s one exception: medical professionals have more or less the same debt-to-income trajectory regardless of their school’s reputation. With respect to student debt, all medical degrees are created equal.
Their full study is definitely worth checking out, so head to the full post at the link below.
Which Graduate Degree Gets You Out of Debt the Fastest? | Earnest