Does it Matter Which College You Attend?

Suppose you are a high school senior with a lot of foresight and a bottom line outlook. Naturally, you would want to pick a college based on how much its degree will be worth in future earnings. Conveniently, there is a website called PayScale "a market leader in global online compensation data" that recently Grads Kit published a list of median salaries by college. They list both what graduates got right out of school and "mid-career median salary."

The methodology of the survey leaves a lot to be desired. Firstly, it is not a random sample, but based on the data entered by college graduates who signed up with PayScale. That happens to be rather a lot of people, but it is still hard to avoid the assumption that the data is skewed in some way.

Secondly, and maybe more importantly, holders of graduate degrees were excluded. As quoted in the New York Times’ Economix blog, Al Lee, PayScale’s director of quantitative analysis attempted to justify this.

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Carnival of Personal Finance #214

This week the carnival appears at Poorer Than You with a US Presidents theme. That’s not a group particularly known for handling personal finances well. I think the only two that accumulated serious money outside of politics were Washington and Bush the Elder. But several of them are pictured on our money, so I guess it’s a natural connection anyway.

Five_Presidents Darwin’s Finance contributed a post that warms the dark cockles of my cold heart, Median vs. Mean: Know the Difference or Risk Being Manipulated. Actually, there are quite a few concepts you should know or run the risk of being manipulated, but median and mean are a good start. I do have one issue with the post, though. Darwin says that "average does not always equate to mean." I suppose anything is possible, but the word "average" is defined as arithmetic mean. You can look it up.

My grim view of things was further reinforced by Modern Gal’s When Personal Finance Jumps the Shark. Too much of PF advice is repetitive drivel. (And yes, I am old enough to remember that episode of Happy Days.)

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When to Start Collecting Social Security

The week before last The New York Times carried a piece on when a person should start collecting Social Security. You kids who read blogs probably didn’t even know there was a choice about when to start getting those checks or that it significantly affects how much you get.SocialSecurityposter2

Basically, the longer you wait, the higher the monthly payment. According to the Social Security Administration’s example (quoted in the article without attribution) a person whose "full retirement age" is 66, and would get $1000 a month starting then, could instead have $750 starting at age 62 or $1320 at age 70.

This dilemma, less now or more later, is faced by all those who would receive Social Security payments, which is to say just about all Americans. (We assume.) And yet it does not get that much attention. Why? Because it’s complicated. There are a lot of moving parts, including some counter-intuitive rules and strategies involving spousal benefits.

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Mortgages, Foreclosures, and the Obama Administration, Revisited

How screwed up are things in Mortgage Land just now? In a Florida dispute over a house in foreclosure, Wells Fargo is suing itself. Apparently, the bank holds both the first and second mortgages. Acting as the first mortgage holder, it is suing all the other lien holders, itself included. They’ve hired two Upsidedown House attrb Stopmangohome different law firms and Wells Fargo (defendant) is disputing the claims of Wells Fargo (plaintiff). What’s really screwed up is that everybody involved seems to think that this is normal.

Nationwide, the tidal wave of foreclosures continues. We’re on pace to clock 3.5 million of them by the end of the year. That sounds pretty bad. But wait, I hear you saying, didn’t the government start a program a few months ago to fix this?

Well, yes it did, sorta. In March the Obama Administration made a big splash with the Home Affordable Modification program. As I wrote at the time, it was greeted with rather a lot of feigned enthusiasm.  Under the surface there was much concern that it wouldn’t work, and more than a few doubts about whether or not it was a good idea in principle.

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Stupid Answers for Stupid Questions

In his Wall Street Journal column from Saturday, Jason Zweig asks Does Stock-Market Data Really Go Back 200 Years? My head immediately fills with responses.

Of course not.NYC_1848

Why would you think it did?

Who could possibly care?

The title of the column isn’t a trick or a pun. It is really a serious examination of the quality of the stock market data prior to 1845. That was a period when the the “stock” in New York Stock Exchange mostly meant what we today call Treasury bonds. Corporations were rare, each was specifically chartered by a state legislature, and they were widely considered to be a sinister product of financial engineering gone amuck.

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