Ever increasing university fees and fear of student debt might put many people off higher education, but investing in your education significantly increases your lifetime earning potential, according to new data from Money.co.uk.
A study of 2,042 UK adults commissioned by the personal finance experts at Money.co.uk, reveals that as many as 62% believe that gaining a university degree will not increase an individual’s lifetime financial value.
However, Money.co.uk has launched a new Degree Valuation Calculator, combining its survey data with salary data from the Institute of Fiscal Studies, to reveal the true value of higher education.
The data proves that for the vast majority of graduates, a degree has a significant impact on lifetime earnings. The average graduate will earn 23% more over their lifetime than those who do not study at university.
According to the calculator, the average university graduate earns £582,532 over their lifetime, which is £107,532 more than those with a minimum of five A-C grade GCSEs.
On average, by the age of 29, men with a degree will be earning a salary of approximately £35,500 – this is a 19% wage increase compared to men of the same age who left education having achieved a minimum of five A-C grade GCSE’s.
For women however, this difference is even more prominent, as women aged 29 who left education at this earlier stage typically earn approximately £20,800 per year, meanwhile female graduates can hope to be earning as much as £31,500 per year on average at this age – a difference of 51%.
The research reveals the largest increases in lifetime earnings for women can be seen in female graduates with a degree in economics, who earn an average of £671,000 over their lifetime, 122% more than women without a degree in any subject.
Moreover, women with a medicine degree will on average earn 113% more over their lifetimes than the average woman without a degree, whilst female maths graduates can expect an increase in lifetime earnings of 95%.
Graduates of Oxbridge and Russell Group universities are likely to see the biggest increase in lifetime earnings amongst those who have a degree. The average graduate of these universities can expect lifetime earnings of £651,000, which is an increase of £176,500 compared to the average UK non-graduate, with a minimum of 5 A-C GCSEs, who will earn £475,000 across their lifetime.
Recent findings from the Chartered Association of Business School suggest that the UK’s most popular degree subject is currently business. According to money.co.uk’s calculator, business graduates can expect to earn an impressive £659,000 over their lifetimes, which is £184,000 more than individuals without a University education.
Salman Haqqi, personal finance expert at money.co.uk comments: “Despite the financial burden of tuition fees, it is clear that university degrees are still a key factor in boosting potential earnings for the vast majority of graduates.
“Our new calculator is a unique tool that allows individuals to compare just how much they can benefit financially from attending different universities and studying different subjects. This is particularly useful to anyone who may be in the process of deliberating their future academic and professional endeavours.
“University is a worthwhile, long-term investment for many, both financially and personally. Going to university is definitely something to consider saving up for and opening up a dedicated savings account for this is a great way to do so.”