88% of millionaires have degrees

Want to be a millionaire? Get a degree!

For decades, there has been a fierce debate about the necessity of university education. Those who support the acquisition of a degree point to the statistics that say people with degrees, on average, earn better salaries than people without. According to a report from Georgetown University, those with a degree earn – throughout their lifetime – 74% more than those who only completed secondary school. Indeed, the higher your degree, the higher your salary.

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On the other hand, those against, say that although getting a degree is not a bad thing, it can be a waste of time and costs too much. The four years dedicated to pursuing a degree, they argue, can be used in starting your career early. They point to Bill Gates, Mark Zukerberg and Steve Jobs who didn’t complete their degrees but became super successful, famous and rich.

This debate is more poignant in the United States, “a land of opportunities,“ where anyone can get a job and explore his potential.”

One of the major advocates of this point of view is MJ DeMarco, in his book, “The Millionaire Fastlane,” he argued convincingly that one doesn’t need a degree. “Bill Gates, Michael Dell and David Geffen,” he said, have been very successful but don’t have any degrees.

To this group, degrees may be correlated with higher salaries, but they are not interested in salaries, their emphasis is on building wealth. Recent data, however, may disappoint them because even wealth-building may be associated with a degree after all.

Chris Hogan drew on the largest millionaires study ever conducted in the United States to write his 2019 book, “Everyday Millionaires”.

Before then, CNBC Money reported in 2017 that there were 11 million millionaires in America. Hogan and his team got in touch with more than  10,000  of the 11 million.  One of the surprising findings was that 95% of them took more than 10 years to become a millionaire. So they didn’t get rich quick. Also,  they were not that young – most didn’t make their first million dollars until they were 49 years old.

But more surprisingly, 88 per cent of them had at least a bachelor’s degree.  Yes, 88%!

While this shows the importance of university education, Hogan reported that the degree doesn’t have to be from a brand name university or a flashy school. In his study, 62% of the degrees were earned from state public universities.

This appears to be a conclusive argument against those who argue that a degree is a waste of time – even in America, the majority of millionaires have degrees.

Those who are against degrees mean well, but they lose sight of three things.

One, they forget that we don’t go to the university for the degree only, but we go to also learn discipline. For example, the discipline of sticking to a schedule. Additionally, we learn to socialise, appreciate diversity, network, communicate, manage pressure, problem-solving, fulfil assigned tasks and so forth. These transferable skills are needed in your career, whether you are an employee or an employer. Therefore, they are favoured in the business world.

Two, knowledge in degree-awarding institutions is already organized. Today, you can google and learn for free all the knowledge universities sell to us as degrees. But a degree saves you the time you require to organize all the pieces in one place. And the universities continue to update their knowledge to keep pace with the fast-changing world. To say nothing of the fact that those who teach in the universities are professionals and experts with decades of experience. Some are even from their respective industries – so they know what works and what doesn’t.

Three, there is more accountability. Acquiring knowledge is hard. Acquiring it without the accountability and pressures of a school is almost impossible. It is the reason why only 10% of those who take online classes complete them because an online class cedes most of the accountability to the individual student.

Interestingly, some of those who say degrees are a waste of time wouldn’t employ someone who is not credentialed. For example, they wouldn’t employ an accountant who doesn’t have any formal qualifications. They may take someone without a degree but only if they had a specialized skill. Even Bill Gates and Zuckerberg who are poster kids of this point of view have highly specialised skills.

This is okay because even Google would employ you without a degree if you’re good enough. But how many people are that good enough to merit employment at Google?

So this camp should revise its messaging.  Instead of saying “you don’t need a degree to make it,” it should be changed to “you don’t need a degree to be wealthy if you have skills that are highly in demand.” For every successful dropout like Bill Gates, there are millions of dropouts who are failures.

Yet, there are professions where a degree is a must-have. For instance, what would you do if a surgeon who is about to cut you open says: “hey my friend, full disclosure, I’m very good at what I do even though I didn’t go to any university for training. I’m self-taught. Now, give me the scalpel”?

The naysayers may still think I’m using foreign statistics to argue my point, the situation is different here, they may say. However, look at your immediate environments such as your family or neighbourhood: who are better off, those with degrees or those without higher education?

First published on Friday, May 15, 2021.