pace, growing only 19% during the same period,
according to the Federal Reserve Bank of St. Louis.
However, loans are still the primary vehicle
for families without wealth to obtain college
degrees. In order to make your degree worth
it, you have to earn enough to justify it. That
means carrying debt that won’t put you
underwater — a manageable student loan
payment is around 10% of your discretionary
after-tax income.
To get the best return and be able to repay debt,
graduation is crucial — many borrowers who
default will have debt but no degree.
“That’s the worst-case scenario — you’re
incurring some of those costs but with very, very
little benefit,” says Jonathan Rothwell, principal
economist at Gallup.
DEMAND FOR YOUR MAJOR MATTERS
What you study in school will affect the type of
job you can get, your earnings and your ability
to repay debt.
Average earnings at mid-career are highest
among those who hold a bachelor’s degree in
fields like science, technology, engineering and
math, or STEM ($76,000), business ($67,000)
and health ($65,000), according to a 2015 data
report from Georgetown University’s Center for
Education and the Workforce.
The same report found the lowest median
mid-career earnings among those whose
bachelor’s degrees were in field s like arts,
humanities and liberal arts ($51,000), as well
as teaching and serving roles such as social
work ($46,000).