There is a wealth of information in our society today! In fact, humans have never lived in a time when information was more accessible. The “Information Age” has made it possible for any individual to “know” practically everything known to everyone. Unfortunately though, many do not take the time to become knowledgeable. But, if we are to hope that our children will become “wealthy,” it is imperative that they become effective in using information with understanding or “knowledge!” In fact, there is a direct correlation between education and income.
I recall as a child feeling a disdain for the educational process, but respecting the wishes of my parents, both teachers, I embraced “education” and tried to make the most of it. As a young adult, I often argued with them that education is an overrated factor for determination of income. Granted, many of my “uneducated” colleagues had done quite well with their own businesses. Recently however, I attended a Lecture by Michael Cox, Chief Economist for the Federal Reserve Bank of Dallas, and I must say the credit for much of this months article really goes to him and the Federal Reserve Bank. After seeing the information he presented, I felt every parent needed a sampling of the “Wealth of Knowledge.”
Not only does education impact income, but also as an individual gains experience, that experience is more greatly rewarded for more educated individuals. I think a picture is worth a thousand words.
As you can see from the chart a 25 year old with a professional degree will earn on average more than double a high school graduate regardless of that high school graduates experience. Plus the individual with the professional degree can look forward to his income doubling over his lifetime, whereas a high school graduate will earn about the same income regardless of experience.
One may ask why education is so highly rewarded. The answer is that the more education one has the greater economic contribution one can make to society. And in a capitalistic society the more one contributes, the more one is rewarded. Furthermore, as a world society more of the world is becoming more educated, and the world continually shifts toward capitalism. So, for your children’s sake, teach them the importance of a good education!