Note: Guest blogger Lewis Warne, an NCPA research associate, talks about the importance of education to a comfortable and healthy retirement.
I hope it comes as no surprise that education has long-term impacts through retirement. In my recent study More Education, Better Retirement, I found that more education increases retirement savings, reduces dependence on government, improves health and increases employment at both a state and individual level. Of course, individual circumstances can outweigh or change any effect from education, but, on the whole, some education after high school is a good thing
In fact, each additional year of lifetime education increases expected income for retirees and improves their expected health more than the previous year. This means that marginal benefit (benefit of one more year) is positive and increasing.
However, this doesn’t mean that a Ph.D. or professional degree is the right choice for everyone. For most, the cost of each additional year of generic cialis fast shipping education increases more than the benefit. So, at some point, the benefits of an additional year of schooling are not worth the cost. This common-sense concept can be depicted in graph form.
On the left side of the dotted line, the benefit of each additional year of education is greater than the cost of that additional year. In this case, a student’s investment in education in terms of tuition, supplies, and the value of other forgone opportunities will be smaller compared to the increase in lifetime income that the student will receive. In other words, the benefit will outweigh the cost. When the benefit and cost curves intersect as depicted in the graph, they have reached the optimum level of education. On the right side of the dotted line, any additional years of education beyond this point will cost more than the value of lifetime income and other benefits the student will receive.
Each individual’s benefit and cost curves will be somewhat different, but the basic premise is still the same. More education is worth it up to a point, but being a “professional student” is probably not.