Calculating ROI for PhD

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magnificent
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Calculating ROI for PhD

Post by magnificent » Tue Oct 30, 2018 8:23 am

I'm weighing the ROI of a PhD in human factors and systems engineering, and I have two main questions for this forum:


1. What are the ways to calculate ROI for graduate school? I've seen threads on this forum suggesting you can calculate a multiplier for school, but they don't seem to account for your pre-education income:
[post-graduation salary] * [years employed after graduating] / [cost of graduate school]

But shouldn't it be this?
[/b]([post-graduation salary] - [pre-graduation salary]) * [years employed after graduating] / ([cost of graduate school] + [opportunity cost of graduate school])

And since I don't anticipate working full time during graduate school, wouldn't the opportunity cost be this?
([pre-graduation salary] - [graduate school income]) * [years of graduate school]

I can't imagine that I've gotten this 100% right, so I'll appreciate any feedback.


2. How should I estimate my post-graduation salary? I assume I will earn above the median salary for my position for several reasons: I have experience in design and technology, I have performed above average in every job I've ever had, and my GRE scores are in the 99th percentile for verbal reasoning (so I hope there are typos in this post just to mess with me—lol), 91st for quantitative reasoning, 82nd for verbal.


Background on my situation:
33, married, 1 child on the way
We're moving to a city with a lower cost of living where we can afford a larger home.
I anticipate needing to find a new job within the next 6 months, probably sooner.
Salary - $115k
Wife's income - $10k/year (potential to rise 2x soon and 5x once we finish making babies)
Assets - $300k in savings, bonds, and stocks
Debt - $0

Ron Scott
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Re: Calculating ROI for PhD

Post by Ron Scott » Tue Oct 30, 2018 8:30 am

Unless you have an automatic increase in total comp for completing an advanced degree or can get a job with high pay that requires a PhD, there is no good way to do this at the individual level, and aggregated stats are so confounded with other variables they are all but useless for predicting comp at the individual level. Don't bother with this assessment.

I have a PhD, completed by the time I was about 30, and I can tell you my experience: If you work hard, demonstrate an ability to handle increased responsibilities, and typically raise your hand when input is required, the PhD will make you stand out among peers. But it will not guarantee you anything.
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Re: Calculating ROI for PhD

Post by TheOscarGuy » Tue Oct 30, 2018 8:59 am

magnificent wrote:
Tue Oct 30, 2018 8:23 am
I'm weighing the ROI of a PhD in human factors and systems engineering, and I have two main questions for this forum:


1. What are the ways to calculate ROI for graduate school? I've seen threads on this forum suggesting you can calculate a multiplier for school, but they don't seem to account for your pre-education income:
[post-graduation salary] * [years employed after graduating] / [cost of graduate school]

But shouldn't it be this?
[/b]([post-graduation salary] - [pre-graduation salary]) * [years employed after graduating] / ([cost of graduate school] + [opportunity cost of graduate school])

And since I don't anticipate working full time during graduate school, wouldn't the opportunity cost be this?
([pre-graduation salary] - [graduate school income]) * [years of graduate school]

I can't imagine that I've gotten this 100% right, so I'll appreciate any feedback.


2. How should I estimate my post-graduation salary? I assume I will earn above the median salary for my position for several reasons: I have experience in design and technology, I have performed above average in every job I've ever had, and my GRE scores are in the 99th percentile for verbal reasoning (so I hope there are typos in this post just to mess with me—lol), 91st for quantitative reasoning, 82nd for verbal.


Background on my situation:
33, married, 1 child on the way
We're moving to a city with a lower cost of living where we can afford a larger home.
I anticipate needing to find a new job within the next 6 months, probably sooner.
Salary - $115k
Wife's income - $10k/year (potential to rise 2x soon and 5x once we finish making babies)
Assets - $300k in savings, bonds, and stocks
Debt - $0
I think you get a Doctorate because you love the subject, and not to make more money, assuming grad school maintenance and tuition are covered for. I went into the program knowing that I will end up probably not making enough money to justify being out of workplace for the duration. I did it anyway because I liked my field.
What is your goal for getting a PhD? If it is doing original research, the opportunity itself (of doing research ) is worth the cost.

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market timer
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Re: Calculating ROI for PhD

Post by market timer » Tue Oct 30, 2018 9:06 am

Don't get a PhD for the ROI. Do it so you can study what you want and never have a boss.

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Re: Calculating ROI for PhD

Post by ResearchMed » Tue Oct 30, 2018 9:15 am

This sounds, uh, like a remarkable amount of precision. And some of the variables aren't easy to quantify in the first place (e.g., the opportunity cost of grad school, which can be financial, but also other "experiences", which aren't necessarily quantifiable at all).

Possibly more importantly, our own experiences and those of just about everyone we know who have PhD's is that the extra years of grad school typically were not done to enhance income.

It's usually "done" because of considerable interest in the particular field, plus a general interest in either research or teaching, and often both.

Many of us could have earned more money doing something else. Some of us did a bit of both.
But it definitely was NOT any expected "ROI" that helped us through those years of grad school.
Most PhD's we know laugh about how much more we could earn doing something else. But we enjoy our work (most of the time; nothing's perfect).

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Re: Calculating ROI for PhD

Post by stoptothink » Tue Oct 30, 2018 9:35 am

Ron Scott wrote:
Tue Oct 30, 2018 8:30 am
Unless you have an automatic increase in total comp for completing an advanced degree or can get a job with high pay that requires a PhD, there is no good way to do this at the individual level, and aggregated stats are so confounded with other variables they are all but useless for predicting comp at the individual level. Don't bother with this assessment.

I have a PhD, completed by the time I was about 30, and I can tell you my experience: If you work hard, demonstrate an ability to handle increased responsibilities, and typically raise your hand when input is required, the PhD will make you stand out among peers. But it will not guarantee you anything.
This. I started my PhD accepting the harsh reality that it likely was not going to improve my career prospects, but I decided to pursue it because it was something I just wanted to do for me. It has turned out well for me, but I am pretty sure I would be in the same place career-wise with just my MS. FWIW, I interview a lot of PhD's for positions on my staff and have never actually hired one. I think I interviewed about two dozen of them for the last open position, which ultimately went to a 22yr old with just an undergrad (who has been amazing). If you are an already stand-out employee, it will make you stand out even more, but otherwise it doesn't necessarily guarantee you anything.

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Re: Calculating ROI for PhD

Post by msk » Tue Oct 30, 2018 9:43 am

Got my PhD (optical communications) at age 26. If it took you so long to decide that you love research (otherwise why a PhD?), why do you bother to evaluate a ROI? Don't do it for the money! For fun? OK. By age 27 I was working in a totally different, non-research field. I went into that (oil) because of the money in a then booming industry (early 1970s). Over my career life, it did pay off lots of $. Had I stayed in academic research there is no way I could have retired at age 55. With already a technical background, if you are chasing $ there must be simpler, more guaranteed ways. Perhaps take a law degree and become a specialist attorney in the industry you have worked in so far?

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Re: Calculating ROI for PhD

Post by Valuethinker » Tue Oct 30, 2018 9:58 am

Remember to include taxes in your calculations. Income is earned after tax.

I've never seen a calculation that a Phd made sense in monetary terms. Too many critical years lost at a time when career success is defined.

Exceptions:

- business school professors (particularly in Accounting) have very high starting salaries - 150k pa is possible with an accounting or finance Phd. Don't underestimate how difficult it is to get published in Finance, though. You may well wind up working for a hedge fund instead.

- perhaps there are other specialities (such as biomedical?) that pay that kind of money in academia. Be warned, areas come in and out of fashion - I understand that US law school admissions are down hugely and that will significantly hit law school academic recruitment.

Do a Phd because you love a subject, think you can contribute something to the body of knowledge and (usually) because you don't mind an academic environment-- the loneliness of research and the bureaucracy, the constant battle to get research funding, teaching responsibilities etc. Maybe you wind up working for Google in research (I think they have hired whole AI labs from universities) but you have to be in the right field with the right team.

Don't do it on an ROI basis. At least I have never heard of an ROI that would not be highly negative given the opportunity costs.

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Re: Calculating ROI for PhD

Post by getthatmarshmallow » Tue Oct 30, 2018 10:05 am

The data are very noisy, but the usual rule of thumb is that the PhD is unlikely in most fields to lead to a monetary benefit over a bachelor's or a master's degree, and that the reason to do the PhD is that you like doing research, or that the job you want requires it (usually but not exclusively the academy.) The salary bump in most cases isn't substantial, and the time to get the PhD often comes with a significant opportunity cost in deferred salary.

In my case, If I hadn't done my PhD, I would not have the job I do now. But if I hadn't done my PhD, I would have continued my career in technology consulting and made a metric boatload more money. I believe I made the right decision -- but if I'd done the PhD hoping for more money I'd be sorely disappointed every day of my life.

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Re: Calculating ROI for PhD

Post by Jack FFR1846 » Tue Oct 30, 2018 10:11 am

It's very dependent on what you do for a living.

Teacher? Sure, go nights and the moment you're granted any PhD, you jump a salary level.
Military Contractor? Yes. Attaining the level of Principal Engineer requires a Masters, higher, a PhD. It's cost of admission to each level.
Commercial companies in engineering: Mostly a "who cares?". I've seen engineers with only a bachelor's degree get into senior executive positions, making millions while PhDs may have to work outside their direct major to get a job. For example, lots of Physics PhDs work as engineers.

Having received my Masters while at a commercial company, I got zip in salary change. The degree did open salary negotiations for other jobs and got me the title "Principal" at one.

But having attained my Masters along side many PhD candidates, I understand how much more work goes into a PhD, compared with a Masters. If it's not required or if you don't have a burning need, I don't see the returns. I was married with no kids when I did my Masters and my wife and I had one date night a week. We pretty much never saw each other the rest of the week. I don't know how anyone gets through with kids in the picture.

I'll add that my company sent me to get my Masters, paid my salary, tuition, books, fees, moving and travel. I'm not aware of companies doing this anymore.
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Re: Calculating ROI for PhD

Post by triceratop » Tue Oct 30, 2018 10:35 am

market timer wrote:
Tue Oct 30, 2018 9:06 am
Don't get a PhD for the ROI. Do it so you can study what you want and never have a boss.
Yep. I could make multiples what I do currently in grad school, but I wouldn't be able to work on nearly the kinds of interesting algorithms, math, or science that I can as a grad student. I spent 2 weeks almost exclusively reading the physics literature just to find an application for an algorithm I developed; it was far from clear how that would pay off. There is a certain pleasure in knowing you are being paid far below what you are "worth" according to a labor market, to further the sum total of human knowledge. Of course, you have to have the ego to believe in yourself.

It makes you into a better person, less concerned with what you don't know but more in how to properly think and discover new results.
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Re: Calculating ROI for PhD

Post by InvisibleAerobar » Tue Oct 30, 2018 11:26 am

triceratop wrote:
Tue Oct 30, 2018 10:35 am
market timer wrote:
Tue Oct 30, 2018 9:06 am
Don't get a PhD for the ROI. Do it so you can study what you want and never have a boss.
Yep. I could make multiples what I do currently in grad school, but I wouldn't be able to work on nearly the kinds of interesting algorithms, math, or science that I can as a grad student. I spent 2 weeks almost exclusively reading the physics literature just to find an application for an algorithm I developed; it was far from clear how that would pay off. There is a certain pleasure in knowing you are being paid far below what you are "worth" according to a labor market, to further the sum total of human knowledge. Of course, you have to have the ego to believe in yourself.

It makes you into a better person, less concerned with what you don't know but more in how to properly think and discover new results.
i'm not so sure. It made my very cynical and jaded, especially toward higher education. Granted, it has also made my more sympathetic and empathetic to people just getting by, especially those with advanced degrees but are underemployed. We had a thread on this a while back, which linked further back to another thread. The OP should read through both of them.

One esteemed member here basically said, unless one is the top 1% of talent, one should not think of doing a PhD. Sad but true.

eta: threads here

viewtopic.php?f=2&t=252204&p=3995271#p3994988
viewtopic.php?p=768639#p768639
Last edited by InvisibleAerobar on Tue Oct 30, 2018 11:33 am, edited 1 time in total.

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triceratop
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Re: Calculating ROI for PhD

Post by triceratop » Tue Oct 30, 2018 11:33 am

InvisibleAerobar wrote:
Tue Oct 30, 2018 11:26 am
triceratop wrote:
Tue Oct 30, 2018 10:35 am
market timer wrote:
Tue Oct 30, 2018 9:06 am
Don't get a PhD for the ROI. Do it so you can study what you want and never have a boss.
Yep. I could make multiples what I do currently in grad school, but I wouldn't be able to work on nearly the kinds of interesting algorithms, math, or science that I can as a grad student. I spent 2 weeks almost exclusively reading the physics literature just to find an application for an algorithm I developed; it was far from clear how that would pay off. There is a certain pleasure in knowing you are being paid far below what you are "worth" according to a labor market, to further the sum total of human knowledge. Of course, you have to have the ego to believe in yourself.

It makes you into a better person, less concerned with what you don't know but more in how to properly think and discover new results.
i'm not so sure. It made my very cynical toward higher education. We had a thread on this a while back, which linked further back to another thread. The OP should read through both of them.

One esteemed member here basically said, unless one is the top 1% of talent, one should not think of doing a PhD. Sad but true.
On the other hand, I had no idea what my talent was when I started my Ph.D.

I can see it as making one cynical towards higher education (I share these sentiments at times) but perhaps not towards research overall as a valuable endeavor. There is more to research than in a university setting.

edit: Yes, those were good discussions.
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Re: Calculating ROI for PhD

Post by JamalJones » Tue Oct 30, 2018 11:34 am

market timer wrote:
Tue Oct 30, 2018 9:06 am
Don't get a PhD for the ROI. Do it so you can study what you want and never have a boss.
+1

I don't have a PhD, but my friend who does, said this exact same thing. He teaches at a college and, yeah, he said he's his own boss, basically...Although, he's doing reasonably well money wise...
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Re: Calculating ROI for PhD

Post by Valuethinker » Tue Oct 30, 2018 11:44 am

InvisibleAerobar wrote:
Tue Oct 30, 2018 11:26 am


One esteemed member here basically said, unless one is the top 1% of talent, one should not think of doing a PhD. Sad but true.

eta: threads here

viewtopic.php?f=2&t=252204&p=3995271#p3994988
viewtopic.php?p=768639#p768639
I think that's useful advice.

With the caveat that a Phd is both about being among the most talented and have the application and personal circumstances to see it through. It's an endurance test of a type which dates to the medieval craftsmen apprenticing to master craftsmen.

Lots of brilliant people around who started Phds and never finished them.

So you have to be 1). top 1% and 2). probably top 5% in application and determination (in British speak "stick to it-iveness".

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Re: Calculating ROI for PhD

Post by KlangFool » Tue Oct 30, 2018 11:48 am

OP,

1) What do you have at this moment? Bachelor Degree? Master degree? In many cases, the Ph.D. will not provide additional income if you have a master degree now.

2) IMHO, if you need to calculate the ROI of the Ph.D., you should not get a Ph.D.

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Re: Calculating ROI for PhD

Post by Afty » Tue Oct 30, 2018 11:49 am

"Top 1%" in talent for what? Talent for research is very different from talent for taking classes or learning from books. I don't think you can evaluate talent for research without actually doing some.

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Re: Calculating ROI for PhD

Post by InvisibleAerobar » Tue Oct 30, 2018 11:55 am

Afty wrote:
Tue Oct 30, 2018 11:49 am
"Top 1%" in talent for what? Talent for research is very different from talent for taking classes or learning from books. I don't think you can evaluate talent for research without actually doing some.
another very good point. I found out about this the hard way, especially those requiring a lot of hands-on experiments. As another poster mentioned, mental fortitude is also important, as failure would come fast and often.

one also has to remember that the professor is in charge, b/c s/he has academic and research credentials. That says nothing about managerial aptitude of the professor, and some of them are down right inept.

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Re: Calculating ROI for PhD

Post by cinghiale » Tue Oct 30, 2018 12:38 pm

Very good responses so far.

My bit... if you don’t have some passion for the deeper dive into your discipline, skip it.

You are right around the same I age I was when I grappled with the same decision. Stepped off the employment track, began graduate studies at age 35, and got the PhD at age 40. I loved the subject area, loved having the “hooks” (read: years of work and life experience) onto which the research and theory could be hung, and loved the challenge of the dissertation.

Life it too short to make this decision based on a formula. There’s an intuitive, emotional, and visceral element to this. Unless you feel the warm hum of intellectual pursuit out ahead of you, you may want to re-think the whole thing. In my program, only half of those who began got to candidate status. And only half of those finished the degree. Do the math. The finishers had, as Valuethinker mentioned, the “stick to it-iveness.”
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Re: Calculating ROI for PhD

Post by ReadyOrNot » Tue Oct 30, 2018 4:21 pm

When I went back full-time for a PhD, I knew it didn't make sense financially. But I figured I would never be satisfied if I didn't go for it. Also I actually wanted to do research and teach.
As it turned out, I never did get into teaching or research, and it took me excessive years to finish.(Also I was terrible at oral exams -- my examiners easily could have failed me if they were in the mood to.) The job market for teaching or research wasn't easy when I got out.
Financially, it was just about the time 401k plans started up, and no one had any advice about how valuable they would be. So I missed all those early years of 401k or 403b growth. I fall far short of 35 years of good payments into Social Security (for maximum benefit). I was laid off in the Great Recession with a PhD (others were too). Actually I still was able to retire early, but overall, a PhD did not pay off. You should have non-financial reasons to pursue a PhD.
Last edited by ReadyOrNot on Tue Oct 30, 2018 4:48 pm, edited 2 times in total.

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Re: Calculating ROI for PhD

Post by dm200 » Tue Oct 30, 2018 4:29 pm

I cannot quantify it, but from observation, many acquaintances with a PhD happily do various kinds of part time "consulting" or teaching activities well into retirement age. They seem well compensated for this and seem to enjoy staying active in these fields.

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Re: Calculating ROI for PhD

Post by manuvns » Tue Oct 30, 2018 4:32 pm

if you currently have a job of 60k and Phd will pay you $30k then rio is negative . this is the only thing i see, not sure where you land after Phd .

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Re: Calculating ROI for PhD

Post by staythecourse » Tue Oct 30, 2018 4:39 pm

market timer wrote:
Tue Oct 30, 2018 9:06 am
Don't get a PhD for the ROI. Do it so you can study what you want and never have a boss.
What does having a phD have to do with not having a boss? Unless you own your own company you will always have someone above you who tells you what to do. The PHD from MIT working at Citadel has a boss (like my friend). The plummer who runs his own company does not (like the guy who did the work when we built our house). So level of education has no correlation to being your own boss.

Good luck.
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Re: Calculating ROI for PhD

Post by oldzey » Tue Oct 30, 2018 4:54 pm

from: http://phdcomics.com/comics/archive.php?comicid=1086

A bit outdated, but I'd bet the gaps have increased.

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Re: Calculating ROI for PhD

Post by MathWizard » Tue Oct 30, 2018 5:02 pm

market timer wrote:
Tue Oct 30, 2018 9:06 am
Don't get a PhD for the ROI. Do it so you can study what you want and never have a boss.
You will always have a boss. Yes, I have more freedom, but I still have a boss.
A University president has a boss (Regents or Chancellors).

Even business owners have bosses, they are called customers.

Yes, I have a PhD, and I have a boss.

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Re: Calculating ROI for PhD

Post by dm200 » Tue Oct 30, 2018 5:06 pm

oldzey wrote:
Tue Oct 30, 2018 4:54 pm
from: http://phdcomics.com/comics/archive.php?comicid=1086

A bit outdated, but I'd bet the gaps have increased.

Image

Ever considered coaching? :P
I suspect so as well..

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Re: Calculating ROI for PhD

Post by stoptothink » Tue Oct 30, 2018 6:36 pm

InvisibleAerobar wrote:
Tue Oct 30, 2018 11:55 am
Afty wrote:
Tue Oct 30, 2018 11:49 am
"Top 1%" in talent for what? Talent for research is very different from talent for taking classes or learning from books. I don't think you can evaluate talent for research without actually doing some.
another very good point. I found out about this the hard way, especially those requiring a lot of hands-on experiments. As another poster mentioned, mental fortitude is also important, as failure would come fast and often.

one also has to remember that the professor is in charge, b/c s/he has academic and research credentials. That says nothing about managerial aptitude of the professor, and some of them are down right inept.
My dissertation experience was a nightmare, dealing with some professors who were by no stretch of the imagination experts in their field (regardless of the letters behind their name) and who were just miserable people in general who seemed to approach the process more as an initiation into academia than as something actually productive and meaningful. Made me very jaded towards academia in general. IMO, at least half the population has the intellectual capability to pursue a PhD, it is perseverance and grit that are the really important factors. Had it not been for my GF (now wife), I very well may have quit about halfway through my dissertation.

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Re: Calculating ROI for PhD

Post by asset_chaos » Tue Oct 30, 2018 6:39 pm

If you're even asking the question in terms of ROI, then don't do a PhD. For the love of god, don't do it. If you do the PhD, I think you'll look back on it as time wasted from achieving your true goals.
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Re: Calculating ROI for PhD

Post by RetiredCSProf » Tue Oct 30, 2018 6:43 pm

The ROI for my PhD in Computer Science was zero.

At age 30, I went back for my PhD, which took 8 years, partly because I was working concurrently. I had a work-study fellowship for two years and a full-study fellowship for one year, but it wasn't enough to live on, so I took $10K in student loans.

When I graduated, I ended up staying at the same full-time job. A promotion gave me a $34 per week increase, just enough to cover the student loan payments. I applied for research jobs, but none panned out. And by the time I graduated, I had lost interest in seeking a tenured teaching position. Instead, I chose to continue teaching part-time to supplement my full-time income.

When I applied for a management position, the hiring supervisor told me I should go back to school for an MBA -- but I still had those student loans to pay off for the PhD. Same supervisor told a colleague with an MBA that he should go back to school for a PhD.

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Re: Calculating ROI for PhD

Post by CppCoder » Tue Oct 30, 2018 6:51 pm

staythecourse wrote:
Tue Oct 30, 2018 4:39 pm
market timer wrote:
Tue Oct 30, 2018 9:06 am
Don't get a PhD for the ROI. Do it so you can study what you want and never have a boss.
What does having a phD have to do with not having a boss? Unless you own your own company you will always have someone above you who tells you what to do. The PHD from MIT working at Citadel has a boss (like my friend). The plummer who runs his own company does not (like the guy who did the work when we built our house). So level of education has no correlation to being your own boss.

Good luck.
Sure, you have a boss, but it's great because you get to tell yourself that you're smarter than your boss so it doesn't matter what she tells you. Or, you tell yourself you're smarter than your boss and it makes it worse because your idiot boss tells you what to do and makes more money than you do. Drat, I forgot which one it is :D.

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Re: Calculating ROI for PhD

Post by willthrill81 » Tue Oct 30, 2018 6:55 pm

market timer wrote:
Tue Oct 30, 2018 9:06 am
Don't get a PhD for the ROI. Do it so you can study what you want and never have a boss.
And summers, Thanksgiving, Christmas, and spring break off. And great benefits. And guaranteed employment. :D
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Re: Calculating ROI for PhD

Post by stoptothink » Tue Oct 30, 2018 7:00 pm

willthrill81 wrote:
Tue Oct 30, 2018 6:55 pm
market timer wrote:
Tue Oct 30, 2018 9:06 am
Don't get a PhD for the ROI. Do it so you can study what you want and never have a boss.
And summers, Thanksgiving, Christmas, and spring break off. And great benefits. And guaranteed employment. :D
I have interviewed literally hundreds of PhDs, for jobs requiring only a bachelor's, who were giving up after a few years of chasing those highly competitive jobs in academia.

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willthrill81
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Re: Calculating ROI for PhD

Post by willthrill81 » Tue Oct 30, 2018 7:17 pm

stoptothink wrote:
Tue Oct 30, 2018 7:00 pm
willthrill81 wrote:
Tue Oct 30, 2018 6:55 pm
market timer wrote:
Tue Oct 30, 2018 9:06 am
Don't get a PhD for the ROI. Do it so you can study what you want and never have a boss.
And summers, Thanksgiving, Christmas, and spring break off. And great benefits. And guaranteed employment. :D
I have interviewed literally hundreds of PhDs, for jobs requiring only a bachelor's, who were giving up after a few years of chasing those highly competitive jobs in academia.
It depends greatly on the area. If you're trying to get into the humanities, forget it. But literally anyone with a Ph.D. in business, especially accounting, can get a lucrative position somewhere. Computer science is another buyer's market.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Re: Calculating ROI for PhD

Post by majiaknight » Tue Oct 30, 2018 7:39 pm

My wife and I both got PhDs in high tech fields when we were closed to 30.
My 2cents: I won't consider doing a full-time PhD at your age and family situation mainly due to too many distractions. I don't think you could really calculate ROI for a PhD program as there are so many variables.

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Re: Calculating ROI for PhD

Post by dknightd » Tue Oct 30, 2018 7:44 pm

Assume ROI is zero. And you'll have negligible salary for 4-6 years while you are in school.
So less years you can save for retirement.
I don't regret doing it. You might!

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Re: Calculating ROI for PhD

Post by Nate79 » Tue Oct 30, 2018 8:06 pm

The ROI for my PhD has been significant considering the significant salary boost and career track possibilities available to me today vs with only a BS including management roles. It was not only the education part but also the critical thinking and teaching experiences that allow me to excel and grow in my career today. These possibilities wod be much less with only a masters.

But I didn't do it strictly for the money though I knew that I would have a higher salary and better potential with the PhD. But the drive came from the love of the subject and research not the potential money.

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Re: Calculating ROI for PhD

Post by inbox788 » Tue Oct 30, 2018 8:17 pm

dm200 wrote:
Tue Oct 30, 2018 5:06 pm
oldzey wrote:
Tue Oct 30, 2018 4:54 pm
from: http://phdcomics.com/comics/archive.php?comicid=1086

A bit outdated, but I'd bet the gaps have increased.

Image

Ever considered coaching? :P
I suspect so as well..
Yikes! 35 of 39 coaches listed here beat that! With the top 9 > $4.94 million!
https://nordic.businessinsider.com/us-s ... ach-2016-9

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market timer
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Re: Calculating ROI for PhD

Post by market timer » Tue Oct 30, 2018 8:36 pm

CppCoder wrote:
Tue Oct 30, 2018 6:51 pm
staythecourse wrote:
Tue Oct 30, 2018 4:39 pm
market timer wrote:
Tue Oct 30, 2018 9:06 am
Don't get a PhD for the ROI. Do it so you can study what you want and never have a boss.
What does having a phD have to do with not having a boss? Unless you own your own company you will always have someone above you who tells you what to do. The PHD from MIT working at Citadel has a boss (like my friend). The plummer who runs his own company does not (like the guy who did the work when we built our house). So level of education has no correlation to being your own boss.

Good luck.
Sure, you have a boss, but it's great because you get to tell yourself that you're smarter than your boss so it doesn't matter what she tells you. Or, you tell yourself you're smarter than your boss and it makes it worse because your idiot boss tells you what to do and makes more money than you do. Drat, I forgot which one it is :D.
When I say not having a boss, I mean doing self-directed work. PhD students are generally self-directed, maybe excepting some of the laboratory sciences where there is more hand-holding. Professors are clearly self-directed in their research. I've generally worked in the private sector with minimal oversight, even on the types of problems I tackle. Of course I have to justify my value a few times a year, but mostly I've always been free to do my own thing.

I think it takes a certain type of personality to thrive as a trailblazer, taking ownership of one's direction and not knowing exactly where one is headed.

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Re: Calculating ROI for PhD

Post by Cycle » Tue Oct 30, 2018 8:42 pm

I have a meng in systems engineers and sit in that role on two projects. Used to have a csep cert. An experienced indispensable systems engineer will have lots of experience writing requirements and modeling systems, and this experience is best gained from sitting in that role on a variety of programs, not from school.

You can take a couple systems engineering classes online to master the background, then get a job as a systems engineer to start honing your trade.

A pmp certification will hold more clout than your phd in the land of systems engineering in my experience.

The next step up the ladder in requirements land is defining the customer needs and analyzing markets, which an MBA would be more appropriate for... It for upstream marketing.

Anyways those are my thoughts. If you want to do research in the systems engineering discipline, by all means persue the PhD.

At my megacorp, phds command maybe 2 years experience worth of pay premium... Since it takes longer than two years to earn a PhD, a full time PhD isn't worth it imo. Half the people I work with have phds (medical device r&d).

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Re: Calculating ROI for PhD

Post by oldzey » Tue Oct 30, 2018 8:55 pm

willthrill81 wrote:
Tue Oct 30, 2018 6:55 pm
market timer wrote:
Tue Oct 30, 2018 9:06 am
Don't get a PhD for the ROI. Do it so you can study what you want and never have a boss.
And summers, Thanksgiving, Christmas, and spring break off. And great benefits. And guaranteed employment. :D
Check, check, check, check, check, and check.

Don't forget Sabbaticals (check).

:sharebeer
"The broker said the stock was 'poised to move.' Silly me, I thought he meant up." ― Randy Thurman

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Re: Calculating ROI for PhD

Post by oldzey » Tue Oct 30, 2018 8:57 pm

inbox788 wrote:
Tue Oct 30, 2018 8:17 pm
dm200 wrote:
Tue Oct 30, 2018 5:06 pm
oldzey wrote:
Tue Oct 30, 2018 4:54 pm
from: http://phdcomics.com/comics/archive.php?comicid=1086

A bit outdated, but I'd bet the gaps have increased.

Image

Ever considered coaching? :P
I suspect so as well..
Yikes! 35 of 39 coaches listed here beat that! With the top 9 > $4.94 million!
https://nordic.businessinsider.com/us-s ... ach-2016-9
COLA for coaches. :P
"The broker said the stock was 'poised to move.' Silly me, I thought he meant up." ― Randy Thurman

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Re: Calculating ROI for PhD

Post by Ragnoth » Wed Oct 31, 2018 2:35 am

ROI on my engineering Ph.D was $0 compared to a M.S.

The salaries are marginally higher on average, but you are going to lose out of 4+ prime earning years (or at a minimum, be severely underpaid).

The experience was fun for me, and it opens up a lot more “interesting” job opportunities—even if they don’t pay that much more. Keep in mind that it’s not going to save you if you lack other basic work ethic or social skills.

Most people from my program didn’t stay in Academia, and I would not recommend any Ph.D in the humanities where Academia is the only realistic job option.

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Re: Calculating ROI for PhD

Post by TheOscarGuy » Wed Oct 31, 2018 9:56 am

oldzey wrote:
Tue Oct 30, 2018 8:55 pm
willthrill81 wrote:
Tue Oct 30, 2018 6:55 pm
market timer wrote:
Tue Oct 30, 2018 9:06 am
Don't get a PhD for the ROI. Do it so you can study what you want and never have a boss.
And summers, Thanksgiving, Christmas, and spring break off. And great benefits. And guaranteed employment. :D
Check, check, check, check, check, and check.

Don't forget Sabbaticals (check).

:sharebeer
I have to comment here. Getting a tenure is very difficult and most folks have no family life or simply single when they are going through that process. Yes, you are guaranteed a job for life but the process to get there is not for the weak of heart. I am guessing one of you went through the tenure, and kudos to you. But it is not for everyone, and you certainly don't want to go through it if you are not that excited about the work to begin with.

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Re: Calculating ROI for PhD

Post by willthrill81 » Wed Oct 31, 2018 10:42 am

TheOscarGuy wrote:
Wed Oct 31, 2018 9:56 am
oldzey wrote:
Tue Oct 30, 2018 8:55 pm
willthrill81 wrote:
Tue Oct 30, 2018 6:55 pm
market timer wrote:
Tue Oct 30, 2018 9:06 am
Don't get a PhD for the ROI. Do it so you can study what you want and never have a boss.
And summers, Thanksgiving, Christmas, and spring break off. And great benefits. And guaranteed employment. :D
Check, check, check, check, check, and check.

Don't forget Sabbaticals (check).

:sharebeer
I have to comment here. Getting a tenure is very difficult and most folks have no family life or simply single when they are going through that process. Yes, you are guaranteed a job for life but the process to get there is not for the weak of heart. I am guessing one of you went through the tenure, and kudos to you. But it is not for everyone, and you certainly don't want to go through it if you are not that excited about the work to begin with.
I guess I'm an oddball. I just finished putting my promotion and tenure portfolio together, and the whole process leading it up to has been fairly painless. Yes, I've published a lot of research, but it hasn't been time consuming to the tune of the 60-80 hours per week that some people talk about. To be honest, I don't think that I've put in more than 40 hours in a single week more than a couple of times. Maybe I'm just the kind of person that can accomplish a lot in a fairly brief period of time.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Re: Calculating ROI for PhD

Post by xenochrony » Wed Oct 31, 2018 10:55 am

Great thread; youve gotten a lot of useful comments here. I was very naive in my 20s and never considered ROI when pursuing a PhD. I was a dreamer, an idealist, not at all pragmatic. I ended up spending way too much time in grad school, and now looking back in the rearview mirror, I incontrovertibly had a negative ROI for the STEM PhD I obtained. This is due to primarily to the opportunity cost of losing waaay too many years in grad school of not generating income and not investing due to no income. By the time I emerged with my PhD, my BS/MS friends/colleagues had already built up sizeable pools of capital AND were well along the runged ladder of career advancement. Further exacerbating this problem, was the 4 year post-doc, which, while it did pay an income, it was barely subsistence level, preventing my from building wealth. The second signficant factor contributing to my negative ROI was the realization, that in my industry, smart and industrious BS or MS colleagues could make comparative incomes to the PhD folks. That is, a PhD did not guarantee a higher wage than a BS/MS. Yes, on average PhDs do make more, but there is a lot of overlap on the wage range. BS/MS workers in my industry moving into management positions easily surpass science PhD wages by a large margin, for the most part.

But your off to a great start by examining ROI before undertaking a program. I wish I had, I would have opted for a MS.

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Re: Calculating ROI for PhD

Post by stoptothink » Wed Oct 31, 2018 10:55 am

willthrill81 wrote:
Tue Oct 30, 2018 7:17 pm
stoptothink wrote:
Tue Oct 30, 2018 7:00 pm
willthrill81 wrote:
Tue Oct 30, 2018 6:55 pm
market timer wrote:
Tue Oct 30, 2018 9:06 am
Don't get a PhD for the ROI. Do it so you can study what you want and never have a boss.
And summers, Thanksgiving, Christmas, and spring break off. And great benefits. And guaranteed employment. :D
I have interviewed literally hundreds of PhDs, for jobs requiring only a bachelor's, who were giving up after a few years of chasing those highly competitive jobs in academia.
It depends greatly on the area. If you're trying to get into the humanities, forget it. But literally anyone with a Ph.D. in business, especially accounting, can get a lucrative position somewhere. Computer science is another buyer's market.
I'm in science and research for a health products company, the individuals I am interviewing have their PhDs in analytical chemistry, molecular biology, biotechnology, etc. Interesting anecdote, while interviewing for my last open position I actually interviewed 4 people who worked together in the same PhD research group; from what I know none of them were aware that their former colleagues were interviewing as well. I ultimately hired someone 5+ years younger than all of them who had just a BS, and she is a rock star.

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Re: Calculating ROI for PhD

Post by prairieman » Wed Oct 31, 2018 10:56 am

I agree with what many wrote here:
Don’t do a PhD for ROI.

Personally, I was on the fence when I went for my PhD. Although I enjoyed grad school, I felt totally unemployable at first when I finished at 30. I couldn’t find a real job and so did a long post-doc, peppered with occasional consulting gigs. I eventually found a great job, though, requiring a PhD, and was in high demand, thereafter. The last 20 years of my career were as good as I could have imagined or hoped for. Thus, I believe it turned out to be a decent ROI, but only over the very long term. Now at 60 and retired, I look back and think that going for the PhD was one of the best decisions I ever made.

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Re: Calculating ROI for PhD

Post by TheOscarGuy » Wed Oct 31, 2018 11:33 am

willthrill81 wrote:
Wed Oct 31, 2018 10:42 am
a couple of times. Maybe I'm just the kind of person that can accomplish a lot in a fairly brief period of time.
Good for you! :beer

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Re: Calculating ROI for PhD

Post by InvisibleAerobar » Wed Oct 31, 2018 11:39 am

xenochrony wrote:
Wed Oct 31, 2018 10:55 am
Great thread; youve gotten a lot of useful comments here. I was very naive in my 20s and never considered ROI when pursuing a PhD. I was a dreamer, an idealist, not at all pragmatic. I ended up spending way too much time in grad school, and now looking back in the rearview mirror, I incontrovertibly had a negative ROI for the STEM PhD I obtained. This is due to primarily to the opportunity cost of losing waaay too many years in grad school of not generating income and not investing due to no income. By the time I emerged with my PhD, my BS/MS friends/colleagues had already built up sizeable pools of capital AND were well along the runged ladder of career advancement. Further exacerbating this problem, was the 4 year post-doc, which, while it did pay an income, it was barely subsistence level, preventing my from building wealth. The second signficant factor contributing to my negative ROI was the realization, that in my industry, smart and industrious BS or MS colleagues could make comparative incomes to the PhD folks. That is, a PhD did not guarantee a higher wage than a BS/MS. Yes, on average PhDs do make more, but there is a lot of overlap on the wage range. BS/MS workers in my industry moving into management positions easily surpass science PhD wages by a large margin, for the most part.

But your off to a great start by examining ROI before undertaking a program. I wish I had, I would have opted for a MS.
hear hear

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Re: Calculating ROI for PhD

Post by triceratop » Wed Oct 31, 2018 12:00 pm

xenochrony wrote:
Wed Oct 31, 2018 10:55 am
Great thread; youve gotten a lot of useful comments here. I was very naive in my 20s and never considered ROI when pursuing a PhD. I was a dreamer, an idealist, not at all pragmatic. I ended up spending way too much time in grad school, and now looking back in the rearview mirror, I incontrovertibly had a negative ROI for the STEM PhD I obtained. This is due to primarily to the opportunity cost of losing waaay too many years in grad school of not generating income and not investing due to no income. By the time I emerged with my PhD, my BS/MS friends/colleagues had already built up sizeable pools of capital AND were well along the runged ladder of career advancement. Further exacerbating this problem, was the 4 year post-doc, which, while it did pay an income, it was barely subsistence level, preventing my from building wealth. The second signficant factor contributing to my negative ROI was the realization, that in my industry, smart and industrious BS or MS colleagues could make comparative incomes to the PhD folks. That is, a PhD did not guarantee a higher wage than a BS/MS. Yes, on average PhDs do make more, but there is a lot of overlap on the wage range. BS/MS workers in my industry moving into management positions easily surpass science PhD wages by a large margin, for the most part.

But your off to a great start by examining ROI before undertaking a program. I wish I had, I would have opted for a MS.
It is possible to save money while being a grad student.

I think that when considering "ROI" one must consider what one's purpose in life is: if it is to quickly amass a pool of investment capital then a Ph.D. may not make much sense. If it is at least partly to further human knowledge and improve the world while also improving the types of positions one is qualified for, if not the raw compensation, then the 'return' is not accurately captured by a salary figure and the whole computation of ROI is very situation- and personally-dependent.
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