It Makes Dollars, But Does it Make Sense? The Rising Cost of a College Degree
The cost of college is at an all-time high, thus making the decision to attend (and the ability to afford) college a daunting one. With the “recovering” economy, soaring unemployment rates, and the terrible job market, adding school loan payments to the mix seems risky. Is earning (or having) a degree financially worth it in this day and age? Let’s look at some recent data to find out.
College can be such an exciting time in a person’s life: unlimited freedom, parties, new friends, and finally starting life … oh, and studying, too, that minor detail. Not to mention the proud parents who are patting themselves on the back for a job well done as they send their child(ren) off to get a higher education, which will ensure a promising life. So why does this exhilarating time often result in stress, debt, and broken promises post-graduation?
According to Forbes, “college costs have been rising roughly at a rate of 7 percent per year for decades,” and have risen 500 percent since 1985. On the other hand, the cost of not attending college also has its major downfalls, such as lower annual incomes and more difficulty landing a job against candidates with four-year degrees, to name a few. So what does this mean for college hopefuls and new graduates entering the workforce? Let’s look at some numbers to see if the dollars make sense.
In PayScale’s report, “2013 College Education ROI Rankings: Does a Degree Always Pay Off?,” it was found that the five best schools for return on investment (ROI) are:
1. Harvey Mudd College
2. California Institute of Technology (Caltech)
3. Polytechnic Institute of New York University (NYU_Poly)
4. Massachusetts Institute of Technology (MIT)
5. SUNY – Maritime College
(To check which schools in your area offer the most for your money, take a look at PayScale’s post entitled, “The Top Schools for College Degree ROI by Region.”)
Don’t fret if you’re not attending or haven’t graduated from one of the top five schools listed above; you can always fall back on your declared major to see if the ROI in the real world is rewarding enough for your liking. PayScale’s “Top 10 Majors by Salary Potential” report provides a run-down of the top earning majors based on starting median pay and mid-career median pay. Coming in at the #1 spot is a Petroleum Engineer major, making an average starting salary of $98,000 and a mid-career salary of $163,000, which far exceeds all other majors listed in both categories. See how other degrees fared against the competition in the chart below:
(See the full report here.)
Regardless of where your area of concentration falls, it’s wise to choose a career that you find interesting and enjoy doing. Too often, people go after careers that yield high salaries but low job satisfaction, then they end up resenting their work load, expensive degree, high stress level, and life. Although choosing a career based on salary potential makes dollars, it also needs to make sense in real-life terms.
TEASER: Keep your eyes peeled tomorrow because PayScale will be releasing a comprehensive list of which colleges provide the best ROI for specific majors.
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