The cost of changing majors

Calculate the real cost of changing majors

You know changing majors can cost you—but do you know how much? Learn how to figure it out—and why it’s sometimes worth the extra money to do it.

Podcast transcript

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PETE: You’re listening to How Not to Move Back in With Your Parents, here on the IU MoneySmarts radio network. I’m your host Pete the Planner, joined as always by Alex. Hello Alex?

ALEX: Hi there.

PETE: Junior in college. Do you call yourself third-year, or junior? What do you think?

ALEX: No, this is not Hogwarts.

PETE: Hogwarts, the Harry Potter. Hey, joined in studio this week by Jack Tharp with IU MoneySmarts. Hello, Jack.

JACK: Hello.

PETE: On the site they call you the sheriff. Are you the sheriff of the IU MoneySmarts? What is your role here?

JACK: I guess that’s a caricature, just because I like to give orders.

PETE: Well, well, excellent. How am I doing?

JACK: You are doing good.

PETE: Yes! Jack, this week on this illustrious podcast, and by the way, if anyone has missed one of these podcasts, first, shame on them, right Alex?

ALEX: Yeah, I can’t believe it.

PETE: There’s just no excuse.

ALEX: Unbelievable.

PETE: But they can go get them at moneysmarts.iu.edu. And there’s a discount this week on the podcastthey’re free. So Jack, this week on the show we are talking about the kind of the financial ramifications of changing majors, and for that matter, selecting majors. Do you think there is a lot of pressure on students Jack, to choose the right major financially—from your perspective in your career and education—do you feel like there is pressure for that?

JACK: I do indeed, and you can tell that just by reading the newspapers, listening to the radio. I think parents actually are talking to their children today about college cost, and they look at it as a return on investment. And so they are talking about, what is the right major to have good earnings? So I do think a lot of students go off to college feeling this pressure that they’ve gotta perform. And if they’re uncertain about their major, how are they gonna pick that right one?

PETE: So, you said something there that I wanna focus in on, return on investment. Alex, when you think about your education right now, does the concept of return on investment ever register with you, or not yet?

ALEX: Completely.

PETE: Really?

ALEX: I’m actually in the point right now in my college career with what I’m doing with my major, where I’ll be solidifying what major I’m going to do for my last two years, after this semester. So I’m getting to this exact breaking point now where I have to decide what I wanna do.

PETE: Okay.

ALEX: And completely you are thinking about, can I get a job that pays, what will be able to pay back if you do have student loans. Money, like making money in your career is at the forefront of most kids’ minds.

PETE: Jack, do you think as a parent of a student in the past, then in certainly as again member of the financial literacy team here, and as a long-time person that’s worked in administration and education—do you think a major should be impacted by the financial realities of that industry, or do you think instead that, choose whatever major you want, just realize there are financial realities?

JACK: Well, I’ll tell you, there are different theories about that. And I do believe students should try to follow their dreams, but I also find that having talked to students for many, many years, that they don’t always do their homework in terms of what that job’s going to be like, what it’s going to pay, and I think some basic study would help guide them in all that. It wasn’t long ago on this campus I had dinner with an adult student, they were coming back and pursuing a graduate degree and they had I completed a degree in art, but it was sculpture and it was metal sculpture. That’s kind of a niche market.

PETE: Yes.

JACK: And it just didn’t quite turn out the way they thought it was going to be.

PETE: Did they ever sculpt you? Like a metal sculpture of you?

JACK: I think that’s where that caricature came from on the website.

[LAUGH]

PETE: Excellent. Alex I’m sure you’ve seen it with people you run around with, friends or whatever, that midway through school they’re like man, my major sucks. I got to do something else. And then you can just see it happen, they add on another year. Have you seen that happen?

ALEX: Definitely. I’ve seen people add another year. But I’m so torn in this and we all are, a bunch of my friends personally. It’s: Do you want to what you want to do? Do you want to make sure you can make money? Is there an in-betweener you can find there? It’s a huge struggle that people are freaking out about. It’s one of the biggest struggles we have honestly.

PETE: But don’t you think, too, both you guys. I’m thinking back to when I was in school which wasn’t terribly that long ago but I don’t think that feeling in a conversation or those thoughts I don’t think it happens until the couple years in. I mean, do you see that going on with freshmen?

ALEX: Not really, no.

PETE: Yeah.

ALEX: With a lot of different majors, in all majors whatever you’re studying. There’s usually just the core classes that you take in the beginning, you don’t really have to get specific and choose, until maybe a couple semesters in. So, it kind of blindisdes us. And we’re like, wait a minute. You kind of see what you’ve been doing so far, do I like this, do I not. And, you always feel like you’re in-between. Unless, there’s those very few who know exactly what they want to do. So it’s really a sticky situation.

JACK: Let me add this cuz I know you’ve talked previously about goals and purpose. And I think students coming in the university for the first time really need to think about, this is a four-year plan. This is a four-year degree. And I’ve got one year to explore. And that’s it. Because it’s, if you continue exploring after that first year you put yourself into year number five and that’s when it gets pretty expensive.

PETE: If I may? And I may because I’m the host. I wanted to give an actionable tip. An actionable tip. I think if you’re struggling to figure out what you wanna do you have one option. And that option is to job shadow. I think you’ve gotta find someone in the industry that you’re considering going into. You gotta pull every connection you know. I mean call in every favor. If your three or four jobs that you’re thinking about, find a way to go have lunch with someone that does that, find a way to go to their workday for a couple of hours. Because what you may figure out, the best thing you can figure out is this sucks I don’t want to do it. That’s the best thing that could happen, because then you’re not gonna be going down a path that you’re gonna regret, and eventually, you’re gonna find something you like. It’s amazing, when you actually see what professions do. Alex, I know you had an internship last summer, a very reputable financial expert, radio host and TV personality, an author and...me, you start to figure out what actual job titles do out in the workforce. I mean, I know I felt like that forever when I was in the schools that I didn’t even know what people actually did. Do you feel that way?

ALEX: There’s all these fancy names out there but you really don’t know what they’re doing til you get to see that in real life, and then you can start knocking it off the list. I don’t like that, can never see me doing that. I might be interested and let's explore that further. It’s a process but it’s something everyone needs to go through. And another recommendation I might be able to make here is, even while you’re at school or in school, align your extra-curricular activities with something you may be interested in so you can also figure out. You can connect through your school or through the club with different people in that field. There’s so many opportunities on campus, whether it be a job, as we talked about a couple weeks ago, or just a club, anything like that where you can figure out what you wanna do.

PETE: Jack, anything to add to this?

JACK: Well, yes, having been on the service side for so long, I would remind students that the Office of Career Development is just a great resource. You tend to think of that when you’re a senior and you’re graduating, and you need some help with getting your resume and those things ready, but they wanna deal with students as soon as they come through the door. And it can help in terms of making decisions regarding their major. So, see the Office of Career Development.

PETE: See in my regular life when I’m not hosting this podcast I know a lot of career experts. And when people come to them mid-career and mid-work life to try to figure out what they want to do, they charge them a lot of money. You can go to Career Services, you’re not paying a nickel. Right?

JACK: That is correct, that’s correct. Yeah, there’s even courses on the book, like the two hour course and career development. And again they are just good tools to help students in that decision making process.

PETE: Speaking of good tools I encourage everyone to go to moneysmarts.iu.edu. You can find lots of resources that Jack’s fine office provides. This has been yet another great episode of How Not To Move Back In With Your Parents, brought to you by the IU MoneySmarts Radio Network.

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