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Earning a diploma from a prestigious university can surround you with ambitious students who are at the top of their class, and on your resume it may impress potential employers. That could open lots of doors and potentially lead to higher income.

There are also career choices or professional fields that hold the promise of greater earning power.  When there is a shortage of skilled workers in a particular specialty, that pushes up salaries and makes it easier to land a job right out of school. Choosing that kind of high-demand career could lead to greater income.

So which should you choose to get the most out of your education? Is it better to attend the most prestigious school possible, or to select an academic major that will lead to a more lucrative career after graduation? Let’s look at what the research shows.

Is it the college or the student that makes the difference?

One recent report revealed that students who attend more selective or prestigious universities earn more money later in their careers. On the surface that might indicate that going to an Ivy League school, for example, is a better long-term investment. But there are other factors that influence earning power that should be taken into consideration. Students who manage to work hard and make the excellent grades needed to go to those top-tier colleges are likely more ambitious and disciplined. Those traits alone could help them achieve greater career success and earn more money, regardless of what college they attend.

Are prestigious colleges an advantage for getting hired?

Sometimes companies do prefer to hire people with prestigious college credentials. So graduation from an impressive university can definitely impress those who make hiring decisions. But that’s not their primary concern, according to a 2013 Gallup Poll that surveyed corporate leaders and asked them about their hiring process. Less than 10% of respondents said that what college someone attended was “very important.” When questioned about four factors that influenced their hiring decisions, the majority of employers ranked which college a potential candidate attended as the least import of all.

How important are your major and your grades?

Those same business leaders did, however, say that one’s academic major played a significant role in their hiring decisions. How you perform as a student is also important, because it can be a predictor of how one will perform in the workplace. Generally speaking, if you have a high GPA that means that you worked especially hard and executed your assignments – and those are traits that every employer values. That’s why HR departments and potential employers look at your resume they take note of your grade point average.

Should you pick a school where you can excel and also learn?

If you attend a top school where the curriculum is especially demanding and you are competing for grades against some of the best students in the world, your grades could suffer from the pressure. After graduation an employer may not think about those factors as they skim your resume, however, and what may jump out at them more is a mediocre GPA. So a good argument can be made for attending the best school where you can also stand out in the crowd and achieve superior grades. That could be more beneficial than going to a prestigious school but earning lackluster grades that don’t look so great on paper.

Which choice is best for me?

The often-cited academic research published by Alan Krueger and Stacy Berg Dale on this subject  found that attending a more selective and prestigious institution does not have any significant impact on your earnings. They concluded that the fact that you do go to college is more important than where you go to college. Data from the U.S. Census Bureau validates that conclusion, showing that college grads earn almost twice as much as those who only have a high school diploma.

What is especially important is that you are motivated, both in college and in your career. Choose a major and a career that you are passionate about, and you will have a much greater chance of success that translates into higher income. Also take full advantage of any resources available to you such as career counselors who can help you identify a career that will excite you while also ensuring a chance to earn as much money as possible.


Please note that the information provided on this website is provided on a general basis and may not apply to your own specific individual needs, goals, financial position, experience, etc. LendKey does not guarantee that the information provided on any third-party website that LendKey offers a hyperlink to is up-to-date and accurate at the time you access it, and LendKey does not guarantee that information provided on such external websites (and this website) is best-suited for your particular circumstances. Therefore, you may want to consult with an expert (financial adviser, school financial aid office, etc.) before making financial decisions that may be discussed on this website.