I decided to hypothetically put two people seeking professional careers, one a prospective college student, the other a truck driving school candidate, up against each other in a comparison of job training, annual salary, debt accumulation, and investment capability throughout their careers. We’ll start the time frame with the student entering college and the truck driver entering truck driving school.
Off To School We Go
The college student is seeking one of the top paid careers with a degree in any of the following: Marketing, Business Administration, Mechanical Engineering, Management Information Systems, Civil Engineering, Electrical Engineering, Computer Science, Accounting, Finance or Economics. The truck driver is just looking for a good driving job that will put him home every day with good pay.
To be fair, we will base the cost of the college student’s tuition on an average of $16,000 at an in-state public university, and about $33,000 for a private school each year for 4 years. These costs include tuition, fees, books, room and board and other expenses.
The Cost Of CDL Training Versus A College Degree
The average cost of training at a truck driving school is around $1,500 to $3,500. Some truck driving schools pay for room and board and some truck driving schools sponsored by trucking companies pay the student wages while they are training. Trucking company schools will often pay for some, if not all of a student’s training if the student agrees to work for them for one year.
A Year After Training Had Begun
First, let’s fast forward to the 3 month level from our starting point: The college student is learning and acquiring debt. The truck driver has completed his schooling and has been making money driving for a break-in company at the rate of $35,000 a year. The driver has just got enough experience to get hired with a career company and he does.
One year and 3 months from the starting point: The college student is still learning and acquiring debt, somewhere between $20,000 and $41,250. The truck driver has had several pay raises, and grossed about $45,000 his first year with his new company. He put $6,000 in his 401k including a handsome company match. He also put money in an IRA of $3,000 and is buying stocks. He goes home every day to the brand new house he just purchased, and is enjoying all the freedom that driving has to offer.
A Few Years After Training Had Begun
Two years and 3 months in: The total debt of the college student is around $36,000 to $74,250 dollars, but he is learning. The truck driver’s gross earnings were $55,000 dollars, again topping out his 401k and an IRA for a new balance of $20,000 dollars with interest. He is making extra payments on his home and it has been appraised at a value $4,000 above original purchase price.
Three years and 3 months from the starting gate: Our college student is beginning to realize how long it is going to take to pay back those student loans. It’s a good thing he chose one of the top starting salary majors or he might be in trouble. His total debt acquired so far: $52,000 to $107,250 dollars. And our truck driver’s house value has gone up to a total of $8,000 dollars above purchase price. His investment account’s total balance is $30,250.
4 years and 3 months later: Congratulations to our college student! Happy graduation! Your debt is $68,000 to $140,250, plus interest. Your starting salary as an Electrical Engineer is $54,599. Our truck driver has earned $60,000 dollars this year and his home value is up $12,500 above the purchase price. His investment portfolio balance is around $45,000 dollars.
A year later: In the following year our college student is working and likes his new job. He is in the market for a new home, but is very limited due to the debt he has acquired. A job starting at $55,000 seemed like a lot of money when he first started school, but with the student loans to pay back it has limited him to a home below previous expectations. As much as the student would like to save for retirement, he just can’t seem to find the extra money to invest. To furnish his new home he does what most Americans do, he runs up those credit cards. Sound familiar?
Our truck driver couldn’t be happier. He has plenty of time at work to study and learn all of the things he finds interesting. His home keeps appreciating and stocks are doing well. He has close to a $65,000 balance in his portfolio and is enjoying all his free time driving down the road listening to audio books on investing. He is getting ready to build a new custom home, and with only about five years in this industry, he can see an early retirement on the horizon.
It’s All About Happiness and Sound Finances
Now if you look at the college student’s $68,000 to $140,250 debt compared to the drivers balance of $65,000 plus home equity, we have as much as a $200,000 difference at about 5 years. The college student has the power of interest working against him, while the truck driver has the power of compounding interest working in his favor!
Being happy or successful in life is not about a title or a piece of paper. It’s about making wise decisions that can make your life smooth and stress free. Regardless of the reasoning, taking on debt is not a good plan if you want to achieve financial independence or experience true freedom in a timely fashion. It’s a person’s debt-to-income ratio, and what they do with their money that counts. In this and most scenarios, the college student may not ever catch up to the truck driver financially, and may or may not ever be as happy.
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Thanks Carl for a very well written and entertaining piece. “Being happy or successful in life is not about a title or a piece of paper. It’s about making wise decisions that can make your life smooth and stress free” Amen!
-ike
Youre welcome IKE.
I try to help out give a good judgement even if i’m not always right.
I appreciate everyones intrest and hope to be of help.I’am hoping to publish short book by this summer.Even though some of what i say is a conflict of intrest to where i work.I still try to keep a happy medium.
The kudos of the trucking lifestyle would only hold true for those who do not mind the necessary sacrifices… i.e. being away from home on weeks upon end… or only being home for a very short (trucker’s) weekend. For those who would desire a more normal life with a decent paycheck, there is no substitute for a college education.
Ahhh….do not forget the other trade schools – welding, mechanics, electrical, etc. There is also the self-taught realm available nowadays over the internet. I’m making a living as a web developer now and never spent 5 seconds in a classroom for it – learned it all myself online for free – learn as you go. I think back in the day the college route was the ticket to anything you wanted. Nowadays there are a lot more options available.
Very true. A college education is not a prerequisite to success, but it usually allows one to navigate the path more easily. Also, if you compare the turnover rate among truckers to the turnover rate among, say, computer network engineers, you’d be looking at an industry-wide turnover rate of around 130% for the truckers, and less than 20% for the engineers. All I’m saying is that a college education is more likely to put someone into a position where the lifestyle is manageable. I don’t think anyone would argue that trucking is a tough and demanding lifestyle with a high failure rate and merciless odds. Speaking as someone who did go to college and chose to go on the road after spending 20 years in another career, I can say that, at the very least, having an education just makes the world we live in a more interesting place to be. However, education is not confined to the walls of a classroom. Reading books will produce the same effect. And people who are geared toward success will probably achieve it whether thier education comes from a classroom or by other means. But all things considered, I still think college is still the best game in town. In my case, it gives me the option to stay on the road… or not.
I can’t argue with a word you said – I totally agree. I especially liked:
That’s so true. Well said.
And I agree with the idea of having a “backup” career of some sort – one is never enough. Life changes in a hurry sometimes – it happens to everyone. Having more than one career can be a life-saver in an emergency or just a nice option when you want a change of pace. Can never learn too much.
Thanks for writing this detailed contrast between college degrees and truck driving careers. I think you make several valid points.
Hello Carl,
At first appearances, your article seems based on fact but I must bring your attention to the fact that you left out several details. Your hypothetical scenario left out the fact that your truck driver has missed many birthdays, anniversaries, showers, home cooked meals, barbecues and trips to the lake just to mention a few. I know because I’ve been there, missed that. Oh and then there are the fun encounters with DOT and struggling to run legal and avoid tickets while trying to explain to your dispatcher why it’s a bad decision to run 1,500 pounds over gross hauling beef out of Texas. I just do not want anyone outside of trucking to think that living the lifestyle of the truck driver you described is that easy. My husband and I have both been driving about 14 years and we do not own a home nor have we EVER owned a home since we started truck driving. You also did not mention the looks you’ll get in a “nice” restaurant if you go in to eat and haven’t showered for a few days and you know as well as I do that showering every day is a fantasy. A damn good one but still a fantasy that does not happen often. Add to that the unavailability of facilities such as gyms and grocery stores (unless you’re lucky enough to find a Walmart that won’t tow your truck) just to name a few. You also did not mention that the life expectancy of a truck driving is must less than the average citizen due to lack of exercise, regular check-up’s, stress, poor eating habits and of course, accidents. All this must be taken into consideration when weighing the pro’s and con’s of one occupation over another. Yes, your truck driver HAS to consider early retirement because unless he is able to somehow stay in great shape and not let the stress affect him, his first heart attack will surely ground him…that is if it doesn’t kill him. Just my two cents worth.
Thanks everyone for input.If you dont already know I’m back on road again. so maybe see you all out there.
There is much more to a higher education than income numbers. It’s an incredibly enriching experience in many ways that aren’t apparent until you’ve been through it.
Oh, no question the college experience is an amazing experience. But is that what you’re there for? To some degree – almost anyone would say “yes”, myself included. But in the end, it’s about having a great career that suits you well and pays a wage you’re happy with. I think the author was simply trying to point out that trucking can be an awesome career and that universities are not the only option out there.
I completed my electrical engineering degree and owed a total of about $5000.00. Yes that is only $5K. To accomplish this I had to work while I went to school and of course is was a very tough think to do. I have never been unemployed and have opportunities in just about every industry. The reason I found this site is because I am thinking of investing some of my accumulated wealth to start a trucking company. I own homes and property. I am not trying to bragging but trying to make a point here. I’d suggest that one should seriously think about a college education. College will not make you smarter – but it will provide skills that others are willing to pay the big bucks for.