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Yeah this effect of wealth premium going down could be due to the rapid rise of college costs. It has gone up faster than inflation for a long time. The wealth
by dahart 3y ago
Yeah this effect of wealth premium going down could be due to the rapid rise of college costs. It has gone up faster than inflation for a long time.
The wealth premium is the part I was referring to about this being somewhat misleading, IMO. They calculate wealth premium in terms of a ratio of savings at retirement to yearly salary. They show plots of the wealth premium trending down and saying that savings with a degree are soon to be not better of than savings without. However, this hides the fact that the degree holders have 2x the savings in absolute dollars compared to non-degree holders when the wealth premium is “zero” (because the degree holders have 2x the income).