Why Dropping Out Of School Was A Great Choice For Me
Hey look, I tried. I earned A’s. I showed up for class. But it just didn’t work out for me. It was too much work and not enough reward.
No, I didn’t drop out of high school or abandon my undergraduate studies. I didn’t even drop out of law school after discovering I didn’t want to practice law.
But I did drop out of the Master’s program in Civil Engineering after finishing half of the coursework. Only five more classes and I would have earned the Masters degree. But I quit.
I quit, even though my employer was paying for all of my tuition, fees, and books. I quit, even though I was able to instantly complete 30% of my master’s program by transferring in three classes from my juris doctor degree.
I was only taking one class per semester in the evening after work. During the first semester of the master’s program, school kept me busy. Very busy. Between class two or three times per week, a heavy dose of homework, and a few major projects, and a full time job, I was slammed. Add in the birth of our first kid at the very end of the first semester and I didn’t do much other than work, study, and change diapers.
I signed up for course number two in the fall of 2005. It was an online course, but required just as much time and effort as attending in person. It was sometime during that second semester that I decided I didn’t value the master’s degree enough to continue. So I quit.
The purpose of education
Why do we value education?
It’s intrinsically valuable. Smarter people make a better society. Education enriches lives. Students of history are less likely to repeat mistakes of the past. Understanding how our world works makes life less confusing and more satisfying. All are great reasons to get educated for the sake of knowledge itself.
It’s instrumentally valuable. More education tends to lead to higher earnings and more advancement in one’s career. That translates to more money. More money means more options, more freedom, and more autonomy in your own life. Or as I’m fond of saying: Money is the Root of Good.
Is a master’s degree a worthy pursuit?
It depends. In some fields, a master’s degree can greatly expand your career options and turbocharge your earnings over the course of a decades-long career. In other fields, a master’s degree might be required for entry level work.
In my (former) field of Civil Engineering, a masters degree isn’t worth that much. Most employers don’t require a master’s degree and most don’t offer significantly higher salaries to those with extra education beyond a bachelor’s degree.
I took a peek at Payscale.com for civil engineers with 0-9 years of experience. Having a master’s degree adds about $4,000 per year to the median salary. Consider that half or more of those extra earnings are due to people who get master’s degrees being more motivated and higher achievers in general (lazy people don’t tend to further their education as much as highly motivated people). Let’s say the net impact of a master’s degree after discounting for variable motivation levels is about $2,000 per year.
$2,000 per year isn’t a lot after taxes. In my case, state and federal taxes took a combined 22% of every extra dollar I earned (even though we paid nearly zero taxes on a $150,000 income) while payroll taxes took another 7.65% bringing my marginal tax rate to roughly 30%. After taxes, a master’s degree could have earned me another $1,400 per year.
Other benefits to a master’s degree:
- One extra year of experience toward the four years required to obtain the Professional Engineer (PE) license (though I earned my PE at the same time as I would have graduated with the master’s)
- Possibility for advancement (however an MBA would help much more)
- Learn new skills – broaden and deepen knowledge of practice
From my observations, people skills and willingness to enter management had a much more direct bearing on salary and advancement than holding an advanced degree. A genius at leadership, marketing, networking, or rainmaking is worth a lot more than someone who is technically very proficient (at least in the world of consulting engineering). A few years in government employment reinforced the notion that those who rise to the top aren’t necessarily the most highly educated or most technically competent (because, wow, there were some real duds at the top).
Is it okay to give up?
I think so. Phrased differently, giving up is simply moving in a different direction and pursuing other interests.
Instead of spending 400+ hours per year for another 2.5 years earning a master’s degree, I was able to work the occasional bit of overtime at work and get the occasional bonus. But in general, after clocking in my normal 40.0 hours per week, I had plenty of free time to spend with my family and to pursue other fun pastimes such as reading, relaxing, and enjoying the outdoors (like I do now in early retirement).
What can I say? I prioritized extra free time over more money at a very early point in my career.
Instead of focusing my efforts on obtaining another degree that would lead to roughly $1,400 per year in additional after tax income, I chose to streamline my finances. I skipped the money manager and learned how to invest on my own by sticking to my asset allocation.
Advice for those NOT aiming for early retirement
For those seeking a very early retirement, small increases in earning potential won’t help very much. But for those planning to work for a few decades, even a few thousand after-tax dollars per year can add up to a large figure upon reaching a normal retirement age of 60 or 65.
Going back to the salaries from payscale.com, I noticed the master’s degree led to significantly more earnings for engineers with a decade or two of experience. Like $10,000 to $15,000 per year more money.
I knew early on that I wouldn’t have to work more than a decade or two, so I discounted the value of the master’s degree accordingly. By the time I started seeing the big pay differential for the master’s degree, I’d be nearing early retirement. In hindsight, I worked just under ten years in engineering, so dropping out didn’t cost me very much in foregone earnings potential.
Making the right choice
I’m a big believer in continuing education to keep skills from growing stale. But it doesn’t always pay off. The main reason I started the master’s program was because “everyone else was doing it” and my employer offered to pay for all of it. They also wanted me to take a specific course to lead our firm into a new practice area, but that didn’t pan out (for me or them).
At the end of the day, we should all analyze big life choices like pursuing a master’s degree in the context of what we want out of life and how to get there the best way possible. In my case, I realized after a year that I learned what I needed to learn and that another 2.5 years of further education wouldn’t benefit me very much.
I dodged the sunk cost fallacy of thinking “Well, I’ve already spent a year working on the master’s degree. No reason to let that go to waste” and quit when it made sense. I have absolutely zero regrets about dropping out and don’t miss that fourth diploma not collecting dust next to my other three degrees (wherever they are these days).
Much like my choice to leave the world of full time work at age 33, I got out of the master’s program when it made sense. Sometimes being a dropout is a good thing.
Have you ever walked halfway down a path in life and then realized you should go in a different direction?