FinMan Grad > Looking ahead — your finances and projecting future earnings

Looking ahead — your finances and projecting future earnings

This time of year represents both an end and a beginning for many graduate students. Whether you’re finishing up with graduate school or continuing your program, now is a good time to review financial matters related to your future.

Projecting your future earnings
Knowing what you can expect to earn with a graduate degree is important to your decision making before, during, and after graduate school. Having this knowledge can help with salary negotiation and development of a cash flow plan for loan repayment.

You can look it up! Median annual salaries for selected professions
The following salary information for selected professions is excerpted from the Bureau of Labor Statistics, Occupational Outlook Handbook, 2008–2009 (www.bls.gov/oco), and other sources where noted. Starting salary data are provided, where available. You can also get salary estimates from your school, professional organizations, and colleagues working in your intended field.

As a sample, we’ve pulled the current earnings data here for six job categories:

• Computer applications software engineers
• Financial analysts
• Lawyers
• Registered nurses
• K-12 teachers
• Postsecondary teachers (with a brief job opportunity summary)

FYI: Best jobs in the future Check the U.S. Bureau of Labor Statistics' list of the fastest growing job titles and which jobs will have the greatest numerical increases through 2016 (by level of postsecondary education or training).

Computer applications software engineer
In May 2006, median annual earnings of wage-and-salary computer applications software engineers were $79,780. The middle 50% earned between $62,830 and $98,470. The lowest 10% earned less than $49,350, and the highest 10% earned more than $119,770. Median annual earnings in the industries employing the largest numbers of computer applications software engineers in May 2006 were as follows:

Financial analyst
Median annual earnings, including bonuses, of wage and salary financial analysts were $66,590 in May 2006. The middle 50% earned between $50,700 and $90,690. The lowest 10% earned less than $40,340, and the highest 10% earned more than $130,130. The bonuses that many financial analysts receive in addition to their salary can be a significant part of their total earnings. Usually, the bonus is based on how well their predictions compare to the actual performance of a benchmark investment.

Lawyer
In May 2006, the median annual earnings of all wage-and-salaried lawyers were $102,470. The middle half of the occupation earned between $69,910 and $145,600. Median annual earnings in the industries employing the largest numbers of lawyers in May 2006 were:

Registered nurse
Median annual earnings of registered nurses were $57,280 in May 2006. The middle 50% earned between $47,710 and $69,850. The lowest 10% earned less than $40,250, and the highest 10% earned more than $83,440. Median annual earnings in the industries employing the largest numbers of registered nurses in May 2006 were:

K-12 teacher
Median annual earnings of kindergarten, elementary, middle, and secondary school teachers ranged from $43,580 to $48,690 in May 2006; the lowest 10% earned $28,590 to $33,070; the top 10% earned $67,490 to $76,100. Median earnings for preschool teachers were $22,680.

Teachers can boost their earnings in a number of ways. Getting a master's degree or national certification often results in a raise in pay, as does coaching sports, working with students in extracurricular activities, and mentoring or tutoring. Some teachers earn extra income during the summer by teaching or performing other jobs in the school system.

Postsecondary teacher
Median annual earnings of all postsecondary teachers in 2006 were $56,120. The middle 50% earned between $39,610 and $80,390. The lowest 10% earned less than $27,590, and the highest 10% earned more than $113,450.

Earnings for college faculty vary according to rank and type of institution, geographic area, and field. According to a 2006–07 survey by the American Association of University Professors, salaries for full-time faculty averaged $73,207. By rank, the average was $98,974 for professors, $69,911 for associate professors, $58,662 for assistant professors, $42,609 for instructors, and $48,289 for lecturers. Faculty in four-year institutions earn higher salaries, on average, than do those in two-year schools. In 2006–07, faculty salaries averaged $84,249 in private independent institutions, $71,362 in public institutions, and $66,118 in religiously affiliated private colleges and universities. In fields with high-paying nonacademic alternatives — medicine, law, engineering, and business, among others — earnings exceed these averages. Earnings for postsecondary career and technical education teachers vary widely by subject, academic credentials, experience, and region of the country.

Additional Information

A Promising Job Outlook for Postsecondary Teachers Among the largest job-growth categories, postsecondary teachers are expected to increase by 23% (382,000 new jobs) between 2006 and 2016. A significant portion of postsecondary teaching jobs will be part-time and non-tenure-track positions, and prospects will vary by subject taught and the type of educational institution. Contributing factors include increased student enrollments over the next decade, growth in adult education particularly at community college and for-profit institutions, and increasing educator retirements over the next 10 years. As a result, Ph.D. recipients seeking jobs as postsecondary teachers will experience favorable job prospects over the next decade. Opportunities for master's degree holders, graduate teaching assistants, and postsecondary vocational teachers will be very good. The best teaching prospects will be in specialties — such as the construction trades and manufacturing technology — and in rapidly growing fields that offer many nonacademic career options — business, nursing and other health specialties, and biological sciences. Source: Occupational Outlook Handbook, 2008–2009.

Loan forgiveness programs for public service
There are programs that will forgive some or all of your student loans if you enter certain public service careers, like being a teacher in a low-income school, health professional in a low-income or rural area, or attorney working as a public defender or serving in Americorps or the military. (Note: A new, broader federal public service loan forgiveness program goes into effect in July 2009.) Each program operates independently and has it own requirements. New loan forgiveness formulas are being proposed by Congress, several presidential candidates, and various grant-making charitable foundations. Check with your school's career services department for programs specifically geared to your field.

Financial tip: If you can, pay the interest on your loans while in school. This will reduce the amount you repay and build the habit of making payments.

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