One of your resolutions for the New Year may be to go back to school to get an advanced degree with the hope of considerably boosting your income.

But before you dump more debt into your life, find out if the degree is worth it. A recent report by Georgetown University’s Center on Education and the Workforce found that the payoff from a graduate degree could vary from as low as a 1 percent salary bump to a 190 percent wage increase, reported Bruce Watson, senior feature writer of

Here are a few examples, a biologist coming out of college makes an average salary of $60,000, but with a graduate degree you can earn more than $80,000 a year, according to the American Institute of Biological Studies.

An advanced degree can also be lucrative for social workers. The average salary for social workers is $46,970. Get a master’s degree, and that income can jump to an average of $84,000.

On the other hand, a graduate with a petroleum engineering degree can make an average salary of $83,121 but will not see any substantial growth in salary with an advanced degree.

“Workers with bachelor’s degrees [in certain fields] already earn high salaries, which aren’t much improved with higher degrees,” Watson writes.

Are you dreaming of a law degree that will be your ticket to the good life? Keep dreaming, because law school graduates aren’t necessarily bringing home a lot more bacon. According to one survey, almost 90 percent of law school graduates end up with $80,000 in loans and wind up looking for work in a glutted job market with an average starting salary of $62,000.

This is important information, considering the amount of debt people feel they have to take on to boost their income. The average undergrad leaves school with more than $25,000 in student loan debt. Add another $30,000 on average for people who get advanced degrees.

Sisters Alice and Fran Stewart wrote a blog for the Cleveland Plain Dealer last year that made a point that I’ve tried to make with parents for years. The authors of “Making College Pay: Strategies for Choosing Wisely, Doing Well & Maximizing Your Return” argue, quite convincingly, that students should be financially strategic when selecting a college major.

“Though college can be a life-changing experience, for the vast majority of students who head off to college each year, earning a bachelor’s degree is about getting a job,” Stewart says. “Such bluntness may offend those who celebrate college as a sanctuary for personal growth. But young adults increasingly need a degree simply to access today’s job market.”

Here’s the hard truth, the Stewarts say. “For far too many students, college isn’t ‘worth it’ largely because of the choices they make about which college to attend, what degree to pursue and how to invest time spent on campus.”


This week’s Color of Money Question: Should students think strategically about how to improve their marketability and avoid paying more than their degree is worth? Send your responses to Be sure to include your full name, city and state. Put “Is Your Advance Degree Worth the Debt?” in the subject line.

Let’s Chat

Join me today at noon ET for my online text chat. My guest will be Syble Solomon, whose financial card game “Money Habitudes” was my pick for the December Color of Money Book Club.

Be sure to send you questions in early or read the archives later.

Starting next week, I will be the financial contributor for the new ABC show “The Revolution.” I’ll still be a full-time columnist for The Washington Post, but as a result of my work on the show, I will no longer be doing my regularly scheduled video or text chats. I will, however, continue to do my monthly text chats to discuss the pick for the Color of Money Book Club, and occasionally I’ll host a live discussion when there’s a hot personal finance issue.

Don’t Touch Your 401(k)

In a CNN Money blog, Mark Kantrowitz, founder of, responded to a reader who wanted to know if cashing out his 401(k) to pay off student’s loans was a good financial move.

“I graduated in May with a Master’s Degree, but I am currently unable to find full time work in my field,” noted the reader. “Soon I will be on the hook for my first student loan payment of $628 a month and I will have 10 years of payments. Because I am only working part time, I will not be able to cover that payment along with my other living expenses. Should I cash out my 401(k) from a former job? It is worth about $46,000 right now, and that would almost cover all of my student loans.”

No. No. No. That’s what Kantrowitz said -- and what I would say.

In addition to raiding your retirement savings, you’ll be hit with at 10 percent penalty and have to pay income taxes if you’re not 59 ½ years old, Kantrowitz says.

Kantrowitz offers some alternatives to cashing out of your retirement account, including applying for an economic hardship deferment that suspends your repayment obligation temporarily, though the interest will continue to build during the hiatus.

The American Dream

We keep tossing around this term, “The American Dream,” but what does that really mean?

The Washington Post’s Outlook section’s “Five Myths” feature recently challenged what we think we know about the American Dream.

“Few ideas are as central to American self-identity as the ‘American Dream,’” writes Michael F. Ford, founding director of Xavier University’s Center for the Study of the American Dream. “Politicians invoke it, immigrants pursue it, and despite unremittingly negative economic news, citizens embrace it. But what is the American dream?”

Well, here are some of the things it’s not, Ford said:

-- It’s not about being rich. A recent survey by the Xavier Center found that only 6 percent of Americans ranked “wealth” as their first or second definition of the American dream. “A fat bank account can be a means to these ends, but only a small minority believes that money is a worthy end in itself,” Ford writes.

-- It’s not just about homeownership. A New York Times-CBS News poll found only 7 percent of Americans surveyed ranked homeownership as their first or second definition of the American dream. “Homeownership is more important to special interests than it is to most Americans, who, according to our research, care more about ‘a good job,’ ‘the pursuit of happiness’ and ‘freedom,’” Ford said.

Got Financial Issues?

On Monday “The Revolution” premieres at 2 p.m. ET on ABC. My first segment airs next Thursday, Jan. 19.

This is your opportunity to meet me in person and let me help you with your financial issues. So, if you want to resolve a money dilemma, send an e-mail to The show is looking for couples who are always arguing about money. For example, do you fight about how much to spend on your child’s birthday party, if you can afford to take a vacation or whether you should buy a new car? If you and your honey are fighting over money, send your story to the casting e-mail address, and put “Money Disputes” in the subject line.

If you have any general questions about credit cards, your credit score, debt, savings, retirement planning, insurance or other financial issues that I may cover on the show, send an e-mail with your financial question to

Responses to “Consumers Finally Get Their Watchdog”

President Obama’ s recent appointment of Richard Cordray as the director of the Consumer Federal Protection Bureau sparked some controversy. Senate Minority Leader Mitch McConnell (R-Ky.) said in a statement that Obama “has arrogantly circumvented the American people” by using his executive power to make a recess appointment. While Democratic lawmakers say the appointment was long overdue.

For last week’s Color of Money question, I asked: “What are your thoughts on Obama sidestepping the Senate to appoint Cordray to the CFPB?”

“This protection agency is a farce,” wrote Jeannette Mickey of McKinney, Tex. “It’s another government layer that will do very little for the American consumer. It will only increase our overwhelming debt burden.”

Juliette Sager of California disagreed: “The official appointment by the president of Richard Cordray is what we call moving in the right direction,” Sager said. “Our President promised to protect and support the American citizens from these criminals that have not been caught in the mist of all the other corrupted organizations and companies going down. The president should have done this long ago.”

The majority of people responding to the question sided with Sager.

“Republicans have worked very hard in the past three years to undercut President Obama and he has finally started standing up to them. I wish he had done this last summer,” wrote Karen Hempel of Waukesha, Wis. “Republicans are trying to ruin our country and certainly don’t care about anyone but the very wealthy amongst us.”

Linda M. Enders of Indianapolis said, “I am so glad that President Obama has finally made this move to appoint Mr. Cordray to this most important and much needed position.”

Tia Lewis contributed to this e-letter.

You are welcome to e-mail comments and questions to Please include your name and hometown; your comments may be used in a future column or newsletter unless otherwise requested.