I went to a 4-year college, but earned almost all of my money from self-taught programming and design skills.

It's hard to justify the ROI on college.

At $25k/year for a low-tier college, you'll spend $100k (if you don't need loans). If you take that $100k and put it in the market (avg. 7% annual returns) with 0 contributions for 45 years, you could spend every penny you make and retire at 63 with $2.1M.

At more expensive colleges ($50k/yr+) the math seems less and less in your favor.

What if you don't plan to start your life at 63?

I'm not planning for retirement. 63 is a long way off. There's a lot of life between now and then, indeed the majority of my life is between now and then.

These kinds of "responsible financial actions" are a bit silly imho. Invest in yourself now, and spend your time well now. College pays for itself, if you spent $100k on a decent degree I guarantee you'll earn that amount ten times over in any decent career. Aside from that, it's an experience, and that's worth some money in itself.

The difficulty is in landing in a decent career out of college. People have this fantasy that all you have to do is get X degree and go apply at X Y and Z corporation to land a job getting paid 6 figures for the rest of your life. And that's probably true if your X is from an Ivy League school or a massive state school with hyper-competitive admission to the program. And what you're paying for at that point is access to the elite so that you can hopefully ride their coattails into a good job.

If you end up going to a 2nd or 3rd tier school it's basically a wash whether you end up anywhere good. And it's even worse if you don't get X degree, but instead have a degree that doesn't make it through the word filters. And you can't fuck anything up or make any mistakes in your entire academic career. You have to network aggressively. Many of my cohort ended up working as electricians, and one of them manages the line at a brewery. College was pretty useless for nearly all of us, and our lives probably would have been improved by not getting the degree, because at least that way we wouldn't be under the tens of thousands of dollars in debt.

We were mostly mediocre. But we were smart and we knew how to figure things out. That doesn't really matter to most employers, who just want you to know a specific field right out of the gate so they don't have to bother training you.

I lucked out, by the way. I managed to find a job in 2009 clerking in a warehouse at a technology sales company, and it was only because I knew someone who worked there as a service technician. His moving up created openings that I would be able to use to move into increasingly technical roles. And after 4 years there I was making about $44,000/yr., doubling my starting salary as a clerk. The real benefit for me was networking with my current boss. Because if I hadn't met him then I'd probably still be working long hours for little pay.

So I would strongly urge anyone who isn't in the top 10% to strongly reconsider taking your advice. $100,000 is a huge amount of money and would have been a crippling amount of debt for me. As it was, the $20,000 I graduated with after working two and sometimes three jobs was hard to cope with until I lucked out.

I think my comment took it as a given that if you're spending $100k you'll use every single real opportunity you can get in college and make the most out of your $100k.

There's plenty of people that 'made it' from a local not-so-competitive state school. America remains the land of opportunity. But, unless you go to an Ivy or your parents are rich, you shouldn't expect it to come to you.

You can do things in America that you simply cannot in Europe. You mentioned a few way of doing college right in your own response. Wouldn't the correct response be to use your time in college wisely and not slack or "just make it through" but to make the most of it, rather than to skip college altogether just because it's going to be harder than having your life handed to you on a platter if you went to an Ivy?

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2nd point I'd make is if you're in Europe student debt doesn't matter.

Tuition is almost always free/cheap, government pays for tuition and living for your time as a student, and gives very favourable terms to repay (e.g. in the UK you don't pay anything if you earn under £25k/yr, then you pay 7% of amount earned above that, debt is wiped clean after 30 yrs if any remains). It doesn't show up on your credit record or affect mortgages etc.

I'd describe America more as a country that rewards the ambitious (with perhaps some drops of luck) and the rich. If you're neither then the system is made to entrap you. Europe is easily better for general life, but it isn't great for ambitious people.

Not planning for retirement in that you’re not even putting funds into a 401k or other retirement account? I get it if you’re strapped for cash but it sounds like you have the funds to save.

This isn’t clever, it’s irresponsible especially given that just putting a little money away now literally pays dividends later.

I don't mean not putting in a 401k. The comment I was replying to was implying throwing $100k into a savings account is a good idea because you'll have a couple million when you're 63.

I do not advocate throwing $100k into savings for retirement at 18.

There's a difference between reasonable financial responsibility (401k, match pension contributions w/ employer, etc) and spending all your young years worrying about being prepared for retirement.

Enjoy the life you have. Be financially responsible, but don't over-do it, is what I'm trying to say.

Go to college. Get an engineering or other high paying job. Save and invest. You'll have a couple of million by early 40's, maybe late 30's if you're lucky.

Engineering is one of the few fields where this is true. For the vast majority of college degrees this is not true.

Ah great, I agree, there is a balance to strike

I really don't understand what you're talking about. The OP is saying that you wouldn't need to care about retirement at all if you invest instead of going to college, and if you can teach yourself a valuable skill like programming, you could likely get most of the benefits of going to college.

The question is, will a degree give you a better return than putting the money in the market? Maybe a degree would get you a better job, but you get a later start.

Students just aren't taught to figure this sort of stuff out before going to college and getting into debt. College just isn't the right fit for many people and it often just puts them behind.

Where do they get that 100K to invest from? Most people won't have rich parents to give them the 100K to invest. This means you have to get a job and save up. With college, you have student loans.

For most people, if you go to college, you can get to 2M a lot faster than you can by investing 100K and waiting around for 40+ years.

Low tier college should be about $10k a year and that's assumimg you don't do 2 years a community college.

You shouldn't live on campus if you're price sensitive. And you cant include room and board in your calculations because you'd need that anyway.

7% annual returns are also misleading because it ignores inflation. Edit--I've since learned that 7% average already adjusts for inflation.

> 7% annual returns are also misleading because it ignores inflation.

"One of the major problems for an investor hoping to regularly recreate that 10% average return is inflation. Adjusted for inflation, the historical average annual return is only around 7%."

https://www.investopedia.com/ask/answers/042415/what-average...

7% is adjusted for inflation. It's about 10% without: https://www.investopedia.com/ask/answers/042415/what-average...

It doesn't have to be conflated to low tier, state schools are around there as well and cheaper with aid or scholarship. CSU schools are typically pretty cheap considering the areas they are in.

> I went to a 4-year college, but earned almost all of my money from self-taught programming and design skills.

College has other benefits like signalling and networking though.

Eh, unless you're going to Stanford, Duke, or an Ivy League (or maybe USC or $REGIONALLY_RENOWNED_SCHOOL), the networking is definitely not worth the price tag.

What you've written is largely hogwash.

Most fields are not so competitive that you need a degree from an A-list school simply to get your foot into the door.

But you will need to get your foot into the door. Several or perhaps many doors throughout your career. Your network, even if it is not a blue-chip list of Ivy League studs and studettes, can help greatly. Particularly with your first position.

I went to a rather unprestiguous school thousands of miles away from Silicon Valley and the network I established before graduation has directly and indirectly resulted in a lot of work for me over the years.

Anecdotal, sure, but I've heard enough similar stories to be sure that this is a commonplace experience. Not that I need to prove anything. The burden of proof rests with anybody who makes a statement like yours.

Even if the networking one does at $SOME_UNIMPRESSIVE_SCHOOL results in only a few thousand dollars per year over what one would have earned sans networking, over the course of one's working life that can easily equal the cost of a college education.

I went to a public university and the price tag was rather reasonable compared to the typical 200k+ of a private school.

They touted the network but I didn't get any meaningful business connections out of it.

1 year of working in Silicon Valley got me dozens of quality connections that turned into meaningful long-term projects.

> self-taught programming and design skills.

This is essentially my story too, but IMHE, it hasn't been a realistic option for the people I have known who "don't like academics," and consequently struggled or opted out of the system.

(Fwiw, I couldn't stand academics. However, through dint of self study, it didn't prevent me from graduating.)

There's many viable routes that don't have to be academic. I hate the idea of universities being pushed down everyone's throat. They're higher education institutions and should be for people actually interested in academics and possibly/likely research.

Half of the 'degrees' we have now are not academic, and half of these universities shouldn't even exist. I think all routes are fine. Everyone has different interests and learns differently. Trade school should be a prestigious route in its own right and they should be built up as such, rather than trying to chuck everyone into university regardless of whether it's the correct path for them. There shouldn't be a 'university' culture.

From my high school I can think of less than 10% of people that were honestly interested in/good at academics (of any type, science or arts/humanities) that should've carried on to university. In reality, it was pushed down and over 60% went. Most of them just spent their time partying.

And on the same note, schools should be better. It's sad that some people don't get to find their love in academics until college. It isn't necessarily always late blooming imo, it's that public pre-college education often sucks.

That may be the case, but I'd still wager that, for the majority, self-study isn't a viable route - particularly in technology.

(And, IMHO, the many alternatives to academia aren't nearly the rosey picture you purport, particularly for people who hope to be sure of employment in a decade or two. It's clear that, while many will still be here, many won't.)

Self-study isn't what I mean. Nor am I referring to present alternatives to academia. I'm saying the higher education system is broken and this is something governments need to fix (and stop pushing people into university specifically, and accrediting so many that are worthless) and society needs to change in.

There should absolutely be institutions for education or trade-work post high school. These should not necessarily be universities and should still be aimed at all kinds of individuals, but talented individuals that are not good at and have no interest in academics.

Currently those institutions are often not widely respected. Colleges have become the norm post-18. That shouldn't be the case.

45 years from now, $2.1M adjusted for inflation (3%) is $533K. A lot of these compound interest calculators don't show you the values adjusted for inflation. It sounds great when you get 21x your investment. 5x doesn't sound as great, but it's more realistic.

The 7% figure they gave is already adjusted for inflation.

Only if you think you're getting 7% returns after inflation, which statistically is highly unlikely.

$2.1M is literally $100k compounded at 7% over 45 years.

The S&P typically returns 10% YoY. 7% per year is the historical average adjusted for inflation: https://www.investopedia.com/ask/answers/042415/what-average...

You can't perfectly time your retirement to match the S&P 500 average. That's the reason your portfolio shifts to bonds as you get older. It's the reason everyone quotes 7 & 8% as reasonable long-term returns for your retirement portfolio.

Right, but if for each of the past 100 years you tracked people who put money in the stock market and held it for 45 years and averaged each of their returns you'd get a 7% YoY return after adjusting for inflation.

Some would end up lower but some would end up higher.

Nothing is guaranteed, but neither is a job.