Invaluable Advice

How to possibly make a lot of money by graduating sooner - a very real scenario.

Bill, Bob, and Ben are roommates -- all in the same major, all the same age. Bill is studious and wants to graduate in three years even though it means using student loans and going to Evening School during two off-track semesters, and maybe taking Summer Session classes. Bob is also studious but plans to graduate in the typical four years. He might take Evening School classes one off-track semester or attend Summer Session and plans to work the others to avoid student loans. Ben likes his off-track semesters free to have a good time and work a typical student job, and plans to graduate in five years.

Bob and Ben attend Bill's graduation and return home to work during their off-track semester. They each earn $7.50 per hour for 12 weeks or $3,600. Meanwhile, Bill gets his first job after graduation and earns $50,000 per year. He also invests $5,000 in his retirement 401K.

One year later Ben attends Bob's graduation and returns home to work during his off-track semester. He earns $7.50 per hour for 12 weeks or $3,600. Meanwhile, Bob gets his first job after graduation and earns $50,000 per year and invests $5,000 in his 401K. Bill meanwhile is on his second year at a $50,000 salary and his second $5,000 401K investment.

Finally, one year later, Ben graduates and gets a job that pays $50,000 per year and invests $5,000 in his 401K. Bob is on his second year at a $50,000 salary and his second $5,000 401K investment. Bill is on his third year at a $50,000 salary and his third $5,000 401K investment.

Fast forward to retirement:

Bill worked for 42 years, each of which he invested $5,000 in his 401K. He had a steady 8% return each year and retired with $1,642,915.

Bob worked for 41 years, each of which he invested $5,000 in his 401K. He had a steady 8% return each year and retired with $1,516,217. This is $126,698 less than Bill for a difference of only a $5,000 investment and a year of accumulating interest. Plus, Bill earned $46,400 more than Bob between their graduation dates.

Ben worked for 40 years, each of which he invested $5,000 in his 401K. He had a steady 8% return each year and retired with $1,398,905. This is $244,010 less than Bill for a difference of only a $10,000 investment and two years of accumulating interest. Plus, Bill earned $92,800 more than Bob between their graduation dates.

The cost for Bill was a little student loan interest and some extra dedication during two of his off-track semesters and maybe Summer Session. If you are interested in retiring with potentially hundreds of thousands more dollars in your retirement, you might consider a plan to graduate sooner than later.

Evening School and Summer Session are here to help you get there. Enroll today. You'll thank us for a bunch of tomorrows.