Ask HN: college degree

[creativebeing]

I want to be financially independent by age 35, as in im no longer forced to work. Would a college degree be worth it for the knowledge and salary increase in achieving this goal, or would it be better to learn on my own and be self employed.

[jmduke]

There is very little chance that you will achieve that through a salaried position, with or without a degree.

[pukka_my]

College may not make a huge difference if you are comfortable living like an adolescent when all of your friends are starting families, vacationing in Thailand, buying whatever new iObject is out this October - but it makes a huge difference if you want to do any of those things yourself. Right now I doubt you're in a position to know for sure if you ever want kids or decent furniture or to live by yourself. You may even discover that you enjoy working and want to have a career past age 35, an age which probably seems much older from your vantage than mine.

I think the HN community in general tends to underrate the value of college in developing the kind of soft skills (project management, playing well with others, critical thinking, learning how to study something new, writing & presentation skills) that make a real difference in how good an employee/manager/co-founder can be. I would never hire anyone without at least a few years college experience - even if they kick ass at one or two things, they would probably not be as prepared to develop into new roles and skills.

Also, college gives you the opportunity to engage with subjects and people outside of your current interests/peers - whether or not that has a direct impact on your career/life, it will likely make you a more empathetic, tolerant and interesting human being.

[ameister14]

Ok, well let's break this down for you. This isn't terribly accurate but it should give you a place to start.

It's not unreasonable to expect an average 8% return on your money if you put it in the stock market and hold it there for the next 50 years, particularly if you just track indexes.

So assuming an 8% return, and no inflation, how much would you need to live on 72k a year? 900k. Oh, wait, you're going to pay capital gains tax. At current rates (these will change) you need around 85000. That means 1.062 million.

Inflation exists. So, let's say that averages 5% a year. No problem, you make a percentage return too. You're just going to have to live on a real value of 7.6% return on investment, which moves your starting bankroll up to around 1.12 million.

You're going to want more than that, though; medical expenses, buying a house or car, college for children etc. will clean you out.

But let's say none of that applies to you. If you start working at 18 making 100k a year and using 72k of it to live on each year, after taxes you're in debt already.

So, cut back on the living expenses and say you live in a small efficiency and use about 2k a month. You can conceivably save 40-50k a year this way. It'll only take you 23 years or so to make the amount you need if everything goes perfectly, you never have a girlfriend or go out to bars and you're conscientious about saving.

Now, this time can be lessened if you have a matching 401k or something, but the return will be lower as well and there are liquidity issues there, so I didn't have that included as an option.

So do the math yourself on cost benefit. Use average salaries as a guide and recognize that money is only a small part of the reason people go to college.

[6thSigma]

Did you factor in compounded interest with dividends and annual additions? Over 50 years that will not be insignificant.

[ameister14]

I didn't because I wanted to get the barest estimate first to give him a general starting point. I also didn't factor inflation into the principal; whoops on the latter.

[creativebeing]

thank you for your reply, can you re-do that with my correction of 6000 a year instead of per month?

[ameister14]

How are you going to manage that? Do you pay no living expenses? I think 2k a month is a pretty reasonable estimate for comfortable bare-bones living in the USA. Utilities, rent, internet, food, clothing, gas, car insurance...all these things add up to more than 6000 a year.

[creativebeing]

no car, food<100$ a month, living with room mates.

[lgieron]

Less than $100 a month on food? Is this even possible (I'm not from the US) without serious malnutrition?

[ameister14]

and you're planning on living that same lifestyle till you're 35?

[creativebeing]

yep. ideally i would get some passive income from somewhere but if not, then yea, i think i could do it. Mostly i want to know if its possible before i attempt it.

[slajax]

If you want to retire that early then a salary / comfortable job won't get you there. Especially if you are as young as you sound and are already requiring 6k a month. Your best option is to skip the degree and go for broke on the next big thing if you want to legitimately retire. That is provided you actually have the means to do so and this isn't mania speaking. The problem with a salary job is you get comfortable and buy more stuff until eventually you make babies. You should revise your goal to "working for yourself" as it sounds like what you actually desire is freedom. It's a much different scenario to retire at 35 then it is to automate a passive income which affords you freedom. 6k a month is only 600 customers at 9.99 recurring.

[jmole]

How old are you now? If you're young, and you can hustle some financial aid (not as hard as you think), then go for it.

A degree is more about access than knowledge, TBH. Go to a good school, find some professors working on really cutting-edge shit, and work for them. That will give you a better education than just about anything else. If you're just taking classes, any non-Ivy school is going to give you the same education you could get for free online (assuming you really put the effort in).

[creativebeing]

im almost 21. The aid is certainly an option if i qualify as in need. So your saying that the value is how much you learn and get out of it, not so much the value the paper will give you into jobs?

[cmwelsh]

As an entrepreneur, I often wish I had just invested the 4 years and gotten a degree. The piece of paper guarantees you a minimum of 60,000 dollars per year in America. It's a way for upper middle class kids to get their parents to pay for an easy button into their first career. As an individual with that privilege, it's a must-use.

[adient]

The average for a 4 year degree only is just shy of $55,000 so the minimum is well below that. Perhaps you mean specifically computer science, but based on location and the school you went to you can definitely start below $60k. You are probably also referring specifically to SF, where your number sounds about right. Might be time to reconsider your perspective before trying to make sweeping generalizations.

[cafard]

Maybe with an engineering degree. If you are a politics or film studies major, you might get $45,000 (in a major metropolitan area) if you are not fussy about the job you take.

[xiaoma]

>The piece of paper guarantees you a minimum of 60,000 dollars per year in America.

If only that were the case, it would be a much better investment.

[jchonphoenix]

Depends on the university you go to.

Also, most kids go to college with the mindset that they're there to have fun. If people actually attended college with the intent of getting a job and didn't major in basket weaving (art history majors I'm looking at you) then this figure would be much more likely.

[csixty4]

Also depends on location. $60k might be a good entry-level salary in the Valley, but starting salaries are lower in the midwest & east coast where the cost of living is lower.

[creativebeing]

So you think it would serve you as a backup when you really need it?

[creativebeing]

ok, i realized i really messed up, its not 6000 a month, its per year. sorry about that.

[creativebeing]

i should add im going to be living off about 6000 a month during this time. so if im earning 100k a year that adds up quick. but im nowhere near that atm. Right now im working full time as a .net coder for a low wage as i just started.

[Kluny]

Where do you live? I live in one of Canada's most expensive cities, but I live on less than $1000 a month. I am comfortable and don't feel poor, but a lot of people would call my house a slum and my rations meagre. If you can practice a little austerity, even 30,000 a year will allow you to accomplish your goal.

[slajax]

Seriously? I live in Vancouver and used to live in Toronto. I don't know anyone who can live comfortably on that amount. Hell I couldn't even live comfortably on that in Nova Scotia. You must have some extreme couponing skillz or something because 1k a month barely covers rent on a 1 bedroom in the burbs here. Would love to know how you do it.

[Kluny]

I wouldn't call it comfortable. It suits me, it wouldn't suit everyone. I live in a large, very run down house with three roommates. The rent is 1400 a month - I get away with paying 300 because my room has no door, only a curtain. I spend under 50 bucks a week on food, that's not difficult at all if you can develop a taste for beans and rice, and know what to do with chilies and lemon juice.

I ride a small motorcycle for transportation. That's 200 dollars for 6 months of insurance, and about 50 per month in gas. In the winter I take the bus, which is 70/month. My phone bill is 40. Hydro and internet are split amongst 7 people (me and three others upstairs, 3 downstairs). 15 every two months for internet, 70 every two months for hydro.

300 rent 200 food 40 phone 70 transport 7 internet 35 hydro 652 total, leaving a couple hundred for emergencies and fun. Actually, neither of those, since I'm in school right now and don't make any money. I pretty much break even each month with my part time job that makes 150 a week.

I realize that many of the opportunities I have are not available to everyone. I'm particularly lucky with my roommates and the house - as run down as it is, no one bothers you about anything, ever, and everyone contributes to keeping it tidy.

I don't find it difficult, but I can certainly see that some people might. In fact, even I might have a tough time dealing with it once school is done. I'd like to dress nicer than I do and my own cooking is getting pretty tiresome. I also like to do road trips, and haven't been able to do one in quite a while.

PS, I live in Victoria.

[nalidixic]

Ditto. I'm in Calgary and there is no way you can live off 1k a month here unless your payment free and even then it would be tight as hell on 1k.

[creativebeing]

sorry, sorry, 6000 a year

[creativebeing]

6000 a year, correction, sorry

[minimaxir]

You forgot to factor in taxes in your income estimation.

[creativebeing]

After taxes so about 75$ an hour here in MA.

[creativebeing]

that would net you 100k after taxes. I could be wrong and that could be a very unrealistic salary expectation.

[minimaxir]

That's a rather...loftly goal. What kind of work are you doing currently?