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Student Loan Debt Is An Investment!

Posted By Jim On 03/30/2006 @ 4:44 pm In Debt | 11 Comments

I’ve heard many people lament over how much they owe in student loan debt but very few have considered it an “investment,” as they should. According to a Salary.com, the difference between a B.S. and a high school graduate (or GED) is $17,000 a year (from a 2003 article [3], but the differences are probably the same order of magnitude). If you have $100,000 in debt, that means that you’re getting a 17% ROI on your college education, I’ll take that any day.

Also, remember that student loan interest is tax deductible (depending on how much you earn, it starts phasing out after $50k AGI) and the interest rates are probably relatively low, so you’re getting a pretty sweet deal if you think about it!


Thinking about getting a masters? If you can’t get funding to do a thesis (or get the company you work for to pay for it) and have to pay it on your own, it’s worth, on average, $10,000 more a year. Oh, and, if you want another reason to go into debt to fund college, Salary.com estimates that a bachelor’s degree is worth $2.1M over your entire lifetime [article [4]].

Just something to think about the next time you think about your student loan debt.

By the way, I think it’s totally reasonable to complain about student loan debt because private universities are ridiculously expensive to attend (but clearly well worth it) and in part because I have student loans I need to repay too (it’s not as high as some but we’re all in the same boat)… and I enjoy complaining too.


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[3] 2003 article: http://salary.com/learning/layouthtmls/leal_display_nocat_Ser285_Par409.html

[4] article: http://salary.com/learning/layoutscripts/leal_display.asp?tab=lea&cat=nocat&ser=Ser284&part=Par405

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