Why invest in yourself? | Careers and education | Financial Literacy | Khan Academy

This chart right over here is at bls.gov. BLS stands for the Bureau of Labor Statistics, and in a pretty interesting trend here, it shows that the higher the degree level that someone gets, it is associated with higher median weekly earnings. Right? Because they're saying median usual weekly earnings, and you could also see it's associated with lower and lower unemployment the higher of a degree you get.

So one takeaway from this might be, well, if you want to make more money and if you want to have lower unemployment, and I think those are things that most people aspire for, it might make sense to have higher and higher levels of degrees or get more and more education. Now, I will put a few disclaimers on that because it's not necessarily the fact that the education is causing the higher income. It might be the fact that people who are really organized, who are really hard-working, and who are doing well academically, which are all ingredients for maybe success, that those people also just decide to get more education, and then they become more successful.

It's probably, in my mind, a combination of both. The actual education does make you actually more trained, more capable, and more ready for the workforce, and it also opens doors for you that wouldn't have been opened otherwise. But there is an aspect of the same person who might have gotten a doctoral degree. If you were able to run an experiment and they weren't able to get a doctoral degree, maybe they might be just as successful. We'll never know because it's very hard to run that exact same experiment.

But generally speaking, more education does seem to help. It does look like it's an investment in your earnings and in your employability, so to speak. Another thing to think about: you might just look at this and say, "Oh, if I want to be as little unemployed as possible or make as much possible money as possible, I should either go get a PhD or I should get a professional degree, like become a lawyer or become a doctor."

And that might be true in certain cases, but not all degrees are going to be equal in terms of employability and equal in terms of earnings. For example, there are some bachelor's degrees that can make very good money, oftentimes a lot more money than a doctoral degree or professional degree. For example, if you were to major in some types of engineering or, I guess, computer science, which is also in high demand—I guess that's also part of engineering—there could even be associate's degrees that pay very, very well.

A lot of the trades, like becoming an electrician or becoming a plumber, can pay better in many cases than some folks who get a PhD. So you just need to think about not just the level of education but which particular field you're going into. And maybe more importantly, is that going to be a field where you think you can thrive and really dig into that career and make something out of it?

But I think the combination of saying, "Hey, in general, more education is probably a good thing," as long as you don't take it for granted that just the degree by itself is what's going to make you successful, and you're very thoughtful about picking a path, not just how far you want to go, but the actual lane you want to go in—that both you believe, based on information and talking to folks, gives you good financial prospects and it's one that you're going to thrive in.

Because you could go and become a doctor, but if that's not something that you wake up every morning like, "Oh, I love being a doctor," and at some point you're like, "I don't want to become a doctor anymore," then the degree's probably not going to help you as much. It might help you get some other type of healthcare job or something.

So just think about these things, but this is a general chart that, hey, maybe education is a good investment.