These Master’s Degrees Pay Off the Fastest
More than ever, students must factor the return on investment into their degree , which means that the average salary for that degree must be factored in. Financial services company Earnest processed some data to estimate the fastest-paying college degrees.
Ernest analyzed the data to determine which degrees lead to the most and least student debt, and then compared them to average earnings after college. Among other programs, they considered MD (Medicine), DDS (Dentistry), Pharm D (Pharmacy), MBA (Business Administration), JD (Law), Master of Science or Engineering, and Master of Arts. While some degrees may pay off more over time, they wanted to look at degrees that helped students pay off debt faster.
They divided the average debt by the average (self-reported) income to get the debt-to-income ratio for each degree. If the debt-to-income ratio is less than 1, it means that it took respondents less than a year to complete their degree. If the coefficient is greater than 1, it means that the cost of the diploma was more than the average starting salary. The MBA had the lowest debt-to-income ratio, followed by a Master of Science or Engineering. In theory, the idea is for these workers to be able to pay off their debt faster, given their average debt and average income. Here’s what they found overall:
It goes without saying that this is a very generic snapshot based on self-reported salary data, so take the numbers for what they are worth: a broad view. There are many other variables to consider. For example, Ernest also found that school reputation plays a big role:
Graduates from higher-ranking schools across a wide range of disciplines start out their careers with less debt relative to their income. And for the most part, this trend continues even ten years after graduation. There is one exception: healthcare professionals have more or less the same trajectory in debt-to-income ratios, regardless of the reputation of their institution. In terms of student debt, all medical degrees are created equal.
Their full research is definitely worth checking out, so head over to the full post at the link below.