How You Feel About Your Financial Future May Depend on Your College Major

Posted By Terri Williams on June 8, 2016 at 2:50 pm
How You Feel About Your Financial Future May Depend on Your College Major

Most graduating college students have some degree of apprehension regarding their financial future. Some haven’t secured jobs. Many of those who do will start off making entry-level wages, and most have student loan debt to pay off. Furthermore, research indicates that some of this apprehension may be due to a lack of financial literacy, leading some experts to advocate for starting financial literacy education before students enter college.

However, there may be another factor that determines how these college seniors feel about their financial future. The Experian College Graduate Survey Report found a link between financial security among soon-to-be college graduates and their college majors.

Among college seniors likely to rate their future financial security as POOR/FAIR:

Percentage of students Major
34% Majored in social sciences/services
29% Majored in arts and humanities


Among college seniors likely to rate their future financial security as EXCELLENT/GOOD:

Percentage of students Major
44% Majored in business
44% Majored in STEM
42% Majored in health and medicine


When asked about their student loan debt, these are the responses by college major:

Comfortable with student loan debt Likely to defer student loans Wish they had taken less in student loans
Arts and humanities 34% 52% 66%
Social sciences and services 39% 71% 61%
Health and medicine 38% 53% 62%
STEM 53% 50% 47%
Business 49% 52% 51%


If starting salaries are any indication, it’s not surprising that students in some disciplines are not as comfortable with their debt as others. Data from the National Association of Colleges and Employers projects starting salaries as follows:

Major Mean Starting Salary
Arts and humanities $46,065
Social sciences and services $46,585
Health and medicine $48,712
STEM Engineering: $64,891, Computer Science: $61,321, Math and Science: $55,087
Business $52,236

Assumption-based confidence?

GoodCall spoke with several experts about the report’s findings. While there does appear to be a correlation between the choice of college major and the level of confidence regarding financial security and student loans, this may be based primarily on expectations of future earnings.

Relationship expert April Masini says that financial difficulties, such as the failure to obtain gainful employment or earn enough to cover living expenses, can affect the totality of a college graduate’s life. “The fact that STEM majors appear to be more employable speaks to the burgeoning tech, medical and engineering industries; on the other hand, English majors, naturally, will have a harder time trying to get work after graduation than someone with a more specific academic skill set.”

But regardless of the college major, Masini warns that students who equate a college degree with income earning ability may be disappointed, since there is not always a direct connection. “Most universities promise to give students an education — they don’t promise job results upon graduation the way trade or tech schools do,” she notes.

As a result, she says that college students should not take out loans expecting the guarantee of a well-paying job. She says, “The job market is extremely competitive, and you have to understand your place in it, and what employers are looking for.”

It’s a concern echoed by Dr. Patricia Farrell, a New Jersey-based author and consultant. “In the new ‘gig economy,’ all bets are off and jobs last for months, not years; if these new grads were to get sick and didn’t have that once-golden perk of health insurance, who’s going to pay their medical bills?” she cautions.

Also, Farrell says that many grads have to choose between living at home or sharing a one- or two-bedroom apartment with several roommates. “And then there’s the problem of getting those roommates to chip in their share of the rent or to even stay as they had agreed; promises are easily broken and no one ever wants to be responsible for an exorbitant lease,” she adds.

One way to ease some of the uncertainty and stress is by taking a proactive approach. Leslie Tayne, debt attorney and author of Life & Debt, advises new grads to become knowledgeable about their student loans to avoid any missteps or unpleasant surprises. For example, Tayne says they need to know:

  • When does the loan repayment process begin?
  • What are the terms of the loan?
  • What is the interest rate? Is it fixed or variable?
  • What is the current repayment plan? Is it possible to quality for another type of repayment plan, like an income-based or graduated plan?

Tayne also recommends enrolling in an automatic debit service – and suggests setting a phone reminder of when it will be withdrawn from the account, which, she says, can often get lenders a lower interest rate.

Terri Williams
Terri Williams graduated with a B.A. in English from the University of Alabama at Birmingham. Her education, career, and business articles have been featured on Yahoo! Education, U.S. News & World Report, The Houston Chronicle, and in the print edition of USA Today Special Edition. Terri is also a contributing author to "A Practical Guide to Digital Journalism Ethics," a book published by the Center for Digital Ethics and Policy at Loyola University Chicago.

You May Also Like