Several years ago I went to an orthopedic surgeon to have him check out pain in my knee. I got to the office at 9 a.m. (half an hour early), sat in the waiting room for 45 minutes reading two year old magazines and was finally escorted to a treatment room where I waited another thirty minutes. The doctor finally came in, asked me four questions, and then twisted my leg to the left and to the right. He asked me to do a squat and then said, “You have a strained tendon, put some moist heat on it, rest it for a week and you’ll be fine.” The entire session took five minutes. When I went back to the reception desk, I was told that my visit would cost $187. I was astounded. The doctor charged $187 for five minutes work, which means that his hourly rate was $2,244 .00. Amazing!

A few months passed and I ran into the doctor who unbeknown to me was a member of my health club and playing against me in the club’s racquetball league. After I thoroughly trounced him on the racquetball court we went to the bar for a beer (loser buys the beer). I couldn’t resist asking him how he could charge $2,244.00 per hour. He was a bit taken aback but then went on to tell me about his investment in education. It started with the $50,000 to go earn his undergrad degree and the way he saw it, while getting his degree in four years he forfeited $120,000 in wages he could have made had he gone to work out of high school. So in essence, his degree cost $170,000. After that his medical education and MD credential took up eight years between school, internship and residency. His specialized training added greatly to the cost. The total cost of his medical education, including his projection of lost wages, came to $800,000. “Add the undergrad cost and you’re pretty close to $1,000,000, so that’s why I can charge you $187 for five minutes of my time,” he said.

Return on Investment

It was there at that moment that I came to realize the value and power of education. This man invested 12 years and $1,000,000 to have knowledge and a skill that was highly prized and highly compensated. He made an investment in himself. As we got to know each other better he later revealed that his annual earnings were about $1,500,000 after taxes. He was just 34 years of age and expected to work to age 60. I did the math, if he doesn’t improve his earning by a nickel each year, then the total income he would enjoy would amount to $39,000,000 in his lifetime, which represented a return that my calculator couldn’t handle.

I thought about my investment in education and my return on investment and I was pleased when I looked at absolute return but sorely disappointed when I compared it to the good doctor. He told me about a friend of his with an MBA from Harvard that made more than $10,000,000 a year working for Goldman Sachs. He said that the MBA cost him about $100,000 and his return on investment will likely be several hundred million over his lifetime and now I was seriously depressed.

Invest in Yourself!

What’s the point? The point is the only asset we have in life is time and in order to give yourself the greatest opportunity to live a rich and fulfilling life, you must invest as much time, money and energy in obtaining knowledge, for knowledge is power.  In the end, you will earn in proportion to what you know. The individual with just a high school diploma will always be at a disadvantage economically. They have set the cap on their earnings. When you see those with a Bachelors degree heading off to grad school to get their MBA it’s because they know the return on investment that they enjoyed through investing in a Bachelors degree and that further investment will provide even greater returns.

So, where do you want to invest your time? Where do you want to invest your money? The answer is always in YOURSELF and education is the best way to do that.