Bill Gates’ net worth stands at a staggering $72 billion, according to Forbes. Undoubtedly, Gates has achieved unprecedented financial success that has been equaled or exceeded by only a handful of individuals in all of history. Because of this financial success, he is a leader in many areas of business and finance.
On Monday, Feb. 10, Gates held an online question-and-answer session — known as “Ask Me Anything” — on Reddit.com. One Reddit user posed the question: “What is your best personal finance advice for people who make under $100,000 per year?”
Bill Gates: “Invest in Your Education”
Gates’ answer might surprise you: “Invest in your education.”
Gates is often touted as a success story for circumventing the rising cost of college, having dropped out of Harvard without a degree to start his software company.
But Gates sees it differently. In the Reddit AMA, he said, “I love college courses. I still watch a lot of them. … It is strange to call me a college dropout in all but the most literal sense. I went for 3 years and took enough courses to graduate. So I am kind of a failure as a dropout and I don’t have a degree.”
This isn’t the first time Gates has touted the importance of college. “[Higher education has] been a huge strength to the United States, a very important thing that’s allowed us to fund our broad set of activities, allowed us to be a leader in the world,” he pointed out in a November 2012 forum on C-SPAN.
Data Backs Bill Gates’ Advice: Higher Education Leads to Higher Income
While Gates acknowledged that he hasn’t had to live off less than $100,000 a year for a very long time, his personal finance advice to invest in one’s education is strongly backed by data. Americans with more education tend to earn more.
According to the Bureau of Labor Statistics, getting an associate degree will increase earnings by 20 percent over just a high school degree. And from an associate to a bachelor’s, the jump is even higher — an increase of 35.8 percent, from $785 to $1,066 per week.
A recent survey from Pew Social Trends finds that this higher education income gap is even more pronounced for younger generations: Among millennials aged 25 to 32, college graduates earn a whopping $17,500 more than their counterparts with only a high school diploma. They are also less likely to be unemployed, with a 3.8 percent unemployment rate, compared to 12.2 percent among those with a high school degree.
Photo credit: Oninnovation