College Degree Value Calculator reveals the financial benefits of your degree, guiding you to maximize your return on investment and future earnings.
How do you use the education calculator?
Assess the projected income, disregarding the education you are going to pursue on average. Next, type in how much income you want to take home after receiving the education. Think about finding a job after you finish and the odds of being underemployed for a little while. Search salary data from those who graduated at the same time and reflect on how you rank compared to your peers. Also, monitor the state of the job market to get a better idea.
After that, insert your age and the age you hope everything goes well and you will be retired. This is to figure out how long your working life will be with and without an education.
Finally, Enter the tuition cost. This includes incidental fees (library fines or campus transport) but not room and board because it’s likely the same whether you are working or studying. Emphasize the amount the education adds to costs (if it does) before what you would save if self-taught. And if you feel that there is a chance you can get a scholarship or some other kind of financial aid, leave that out as tuition.
Next, put the length of time you were in school. Include expected loan amounts for tuition and related costs, as well as your assumed rate of interest.
Calculator to show the real cost of your education, how much it will COST, and what you can make (with vs without education). If you are working full-time during school, include the average yearly salary you want to make.
After that, the calculator will tell you your education profit, how much it costs, and, with and without education, what amount you expect to earn. And if you give any loan amount, it will provide the monthly payment that you need to fulfill to pay off the loan.
Sometimes, this tool is utilized to calculate the worth of a college degree. Still, it serves an additional purpose, too, once you have finished high school and are looking to continue your education in the future.
Main Assumptions
We have to simplify some assumptions for the ease of the user. The implications of these assumptions can have a big impact on your life, so you must understand them.
Start by averaging all of your career, starting with salaries with vs. without the education you chose. For the sake of average, use that as in average years working if one career has longer working years. Also, consider the event that you will even be out of work and want to stress that you may not get a job in what you’ve studied once you begin. If one salary is going to grow much faster than the other, you should indicate that.
The calculator employs a constant interest rate, and interest is compounded monthly per the calculator. You agree to pay the same amount each month after you graduate, starting the month following graduation, until you pay off your loan within 10 years. If your loan is not fixed, you may put in the thought-out forecasted value for your next 10 years following graduation.
Advantage of knowing your marginal degree value
The other thing to note, the loan calculator assumes that the entire salary difference is attributed to your degree and, therefore, the education you got. This is a strong assumption, especially for jobs that legally require a degree. It is less clear if it is a profession where having a degree is optional.
Learning what your degree is actually worth in money and of value can help you see what you are paying for both dollar-wise and time block-wise. It is how you can check if this is right for you to go to college. There are times when the degree you wish to pursue may not be such a good value that you need to revise your choice from a cost perspective.
If you are going to borrow to pay for your tuition fees, do consider it this way: It is risky to pay for your degree with no career benefit, but borrowing can be more dangerous. You might run into cash troubles if you cannot afford to pay it. In places like the USA in 2024, you also can’t default on your student loans.
Remember, what you get is a ballpark estimate. The real rate of return from this investment will suffer how you handle your future finances, and your graduate career moves, and you end up working really hard to live up to your diploma with sustained discipline.
Financial caution
This tool can help you ballpark how much you may make with your education, but it is not even remotely close. This tool is accurate in the information you provide, but that information is dodgy and dangerous. You should always seek a qualified professional before making any significant financial decisions or should you decide to take debt for too longer period up to education. Use the following only as a reference, with caution and without a warrant.