How much money do you plan on earning after you’re done school? Once you figure out what to do after college, do you know how much income you’ll have coming in?
I wanted to look at the average starting salary after college to see what most paths would pay for recent graduates. Why did I want to do this research on the expected salary for college graduates?
I read a study on MoneyVille (power by the Toronto Star) that noted that 3,000 college students were surveyed and some interesting results regarding finances post-college were found. The majority of the students thought that they would be earning $90,000/year by the age of 30 and out of student loan debt within five years of graduating from college.
Are these expectations for the average starting salary accurate? Is it possible to get out of student loan debt that quickly?
The article itself noted that these expectations were unrealistic. I agreed just based on being in that age group.
What’s really the expected salary for college graduates?
I went to the popular site, PayScale, to check out what the expected salary is for most college undergraduate programs.
There’s only one job that starts out at over ninety grand and that’s for Petroleum Engineers. Those that majored in Economics will bore the world at $47,300 per year. Urban Planning will land you $41,500. The Philosophers will earn $39,800. Marketers will sell us crap at $38,200. Historians will get $37,800. The Graphic Designers will draw themselves $35,600. Photographers will snap shots at $32,900.
What about student loan debt?
Statistics Canada says that that average student debt after college was at $19,500 in 2000. The most recent figure for average student loan debt was pegged at $25,250. In the US, the average amount of student debt is at $23,200 with many cases of graduates owing absurd amounts that easily surpass $50,000 in student debt.
What do all of these numbers mean? That you could easily be spending a huge chunk of your income after college to deal with your student loans. This means that you might not be able to travel the world or own all of those nice toys if you don’t figure out your finances early on.
Why’s the average starting salary so shocking?
This is why many of us get into credit card debt in our 20s. We just feel like we can easily pay it off in the future. It doesn’t seem like a big deal to us. We just envision ourselves making lots of money one day in the future. None of us plan on staying at $50,00 per year forever.
The reality about the average starting salary is that we won’t be making as much money as we would like to be. We won’t become instantly rich right in our mid-20s. It’s going to take much longer than we originally expected.
According to Generation Earn, the average person spends two-thirds of their income on the essentials (housing and food). This means that you won’t have much money for going out and the annual wardrobe upgrade.
Another truth regarding your income after you’re done with your education is that you should look into starting a business because your original salary might not be enough income for you. I outlined in the past how you can start a business with no money right now. I truthfully wish that I signed up with BlueHost much sooner and got involved in the online game earlier. You can easily make more money on the side while you grow your career.
I didn’t mean to scare you with these numbers. I just wanted to paint a realistic picture about finances after college. The good news is that you can start your own business, manage your money properly, and have an amazing life if you’re a little bit smarter than your friends.