Second-Gen College Students Make More Money, Have Less Debt, According to New Study
The financial benefits of having a four-year college degree are more long-term than originally thought. Whether or not your parents have a college education is a determining factor in how much money you’ll earn, according to a new study.
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Research from the Pew Research Center, a bipartisan think tank, used data from the Federal Reserve which included the education levels of parents, CNBC reported.
The study found that 70% of adults ages 22 to 59 who have at least one parent with at least a four-year degree have also earned a bachelor’s degree as well. Only 26% of adults who do not have college-educated parents have a bachelor’s degree.
For adults who have two college-educated parents, that number is even higher. Of the adults with parents who have both completed college, 82% have at least a bachelor’s degree, according to Pew Research.
Financial outcome is also linked to parental education, the study concluded. CNBC noted that the median household income of first-generation college graduates was $99,600, compared to $135,800 for second-generation grads. Pew Research also found differences in median household wealth. Head of household grads whose parents went to college had $244,500 in median household wealth. That number was $152,000 for first-gen grads.
First-gen college grads also tend to take on more debt compared to second-gen graduates, including greater amounts of student loan debt, the Pew study indicated.
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While a college education is valuable, CNBC reports, it’s not the “great equalizer,” according to Richard Fry, senior economist at the Pew Research Center. For those with only a high school diploma, having a college-educated parent made no difference.
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