There are compelling reasons why many parents begin to fund their children’s higher education accounts during infancy. According to WalletHub, “College opens doors to better career opportunities, higher earnings, and new social connections, among other benefits.”
Higher Education = Substantially Higher Income and Stability
Income tops the list of reasons to pursue a bachelor’s degree for many career-minded people. U.S. News & World Report claims the value of a college degree is greater than it has been in nearly 50 years. The Pew Research Center has found that the earnings gap between Millennials with bachelor’s degrees and high school diplomas is wider than it has been for generations. Among ages 25-32, the median annual earnings difference is $17,500, and that gap continues to widen.
SmartAsset reports data from the U.S. Census Bureau, which shows that the average national salary for workers with a high school diploma is $35,256, with a 5.4 percent unemployment rate. The average salary for workers with a bachelor’s degree is $59,124, with just 2.8 percent unemployment. In other words, earning a bachelor’s degree improves income by 67 percent!
In Kentucky, the median earnings among ages 25 years old and above is $44,200 for bachelor’s degree holders and $26,000 for those with a high school diploma. In this state, earning a bachelor’s degree improves income by 70 percent. Yet the latest state data (2016) shows that just 8 percent of the state population ages 18-24 and 13.4 percent of the population ages 25+ have a bachelor’s degree or higher. Contrast that with the national percentages at 10.2 and 18.8 percent, respectively, and the need for a boost in state educational attainment is clear. According to the WalletHub article mentioned above, Kentucky currently ranks #46 among 50 states in educational attainment.
Higher income for Kentuckians results in more funds for housing, better education for children, and discretionary funds for enjoying vacations, leisure activities, dining out and entertainment. In a state with a relatively low cost of living, even seemingly small differences in income can dramatically enhance purchasing power and the lifestyle improvements that come with it.
More Job and Career Opportunities
State officials in Kentucky have been working to boost the state population’s educational attainment. With a growing and diversified state economy, there is an increasing number of jobs available to bachelor’s degree holders. The state, in cooperation with many employers, has published a list of job titles which require a bachelor’s degree on its official website. These are just a small representative sampling of the available opportunities. The positions are in both the public and private sectors, and represent a broad array of skills, interests and possible industries. Even more important than the immediate opportunities, these positions represent entry points to rewarding careers.
Benefits That Pay Dividends in Many Ways
Not only does a bachelor’s degree open doors to higher paying positions, but the positions also tend to offer more generous and comprehensive benefits packages. Chief among them is good health insurance. Strong coverage means lower employee participation costs, lower deductibles and lower co-pays. Good plans also have provisions for proactive health monitoring, which can prevent disease and improve lifetime health and life expectancy. Alongside a good health insurance plan, you will often find flexible health spending accounts and incentives for healthy eating and exercise. All of these health benefits accrue over the years as people see the difference that greater attention to their health makes in the long run. Anyone considering a bachelor’s degree should strongly consider the value of employers’ investments in their health.
Benefit packages for bachelor’s degree-level positions (and higher) often include other important components. A 401(k) or alternative retirement investing plan is the key to having a happy and healthy retirement. Strong retirement plans offer employer matching of employee contributions up to a certain percent. More employer matching means more tax deferred income and retirement funds that grow faster. A high correlation exists between educational attainment and the financial benefits an employee receives.
Benefit packages for college graduates often include other provisions like life insurance, supplemental insurance and flexible spending accounts for over-the-counter medicine and child care. Benefits like these enable workers to take care of their families and to perpetuate a cycle of living well. Living well begins with education, so it’s no wonder so many parents fund their children’s college savings accounts as early as possible.
Learn more about Northern Kentucky University’s online undergraduate business programs.
Sources:
Statistical Atlas: Educational Attainment in Kentucky
U.S. Census Bureau – Advanced Search – Educational Attainment
U.S. News & World Report: How Much Is That College Degree Really Worth?
U.S. News & World Report: Study: Income Gap Between Young College and High School Grads Widens
