Is College Worth The Investment in 2018?

Some say college isn’t worth it because it's too expensive. This year college costs rose to 3% greater than inflation. However, the 7% rate of return for a degree is still greater. Yet there are ways students can make their degree a better investment.

Public Opinion and Rising Costs

According to a Pew Research survey, public opinion regarding colleges and universities has taken a negative turn. Although support for higher education is sharply divided by partisan politics, the number of Republican-leaning respondents who support higher ed has drastically fallen since 2015. Only 36% of polled Republicans believe higher ed has a positive effect on the country. This is a drastic fall from 2010 where 58% of Republicans supported higher ed.

Similar results were found by a Gallup Poll where they asked respondents what their level of confidence is in the higher education system. Only 33% of Republicans had “quite a lot” or a “great deal” of confidence in the system. While Democrat-leaning individuals have traditionally been proponents of higher education, it is especially worrisome to college administrators that the federal and many state governments are run by a majority of Republicans.

Another thing to worry about is the rising costs of obtaining a degree. According to the National Financial Capability Study carried out in 2016, student debt is a rising concern. Over half of the respondents said they would take a different course of action when it came to taking out student loans if they had the chance to do it again. Worse yet, nearly 30% of respondents indicated that they did not complete their program for which they took out a student loan.

With public support flailing and rising costs, does it really make sense to attend college after high school? In many instances, the answer is still YES.

Education is an Investment

College students won't see returns on their education dollars for at least four to six years, eventually outpacing a high-school grad by age 34.

College students won't see returns on their education dollars for at least four to six years, eventually outpacing a high-school grad by age 34.

Many people tend to think of college as a means to an end – getting a good paying job, but instead, people should think of college as a long-term investment.

If you put money into the stock market tomorrow, you wouldn’t expect to immediately begin reaping the benefits right? The same goes for college. After completing college, bachelor’s degree recipients earned on average $24,000 more than high school graduates according to “Education Pays 2016” a report by the College Board.

Although some people argue that high school graduates who begin work immediately after graduation will get a leg up on someone attending college, the college graduate will start to catch up and outpace lifetime earnings of the higher school graduate by age 34.

The Education Pays report also clarifies that while pay will generally be higher for a college graduate than a high school graduate, the pay difference will vary based on the type of work the person goes into after graduation. For example, the pay difference between a general office worker with high school diploma and degree holder will be small, while someone working in an engineering field will see a much larger difference.

A lack of college degree could also make it harder to obtain a job. Again, according to the Education Pays report, individuals with a bachelor’s degree historically have had about half the unemployment rate of someone with a high school diploma.

How Can You Save Money?

There are numerous ways to try to make a college education work for your child and family. If your child needs to avoid or minimize student debt (as everyone should) here are some ideas to help.

Consider having your child take college-level courses in high school if possible. Depending on the high school and state government, they may be able to take up to two years of college credit. This requires excellent grades, but this could help get general courses out of the way at a greatly reduced (or free) cost.

If college credit isn’t possible during high school, consider having your child attend a community college the first two years of their program. Community colleges are generally much less expensive than a four-year degree and as long as credits transfer, your student can save a great deal of money.

Work study programs at their chosen college can reduce the cost of attendance, but your child must qualify for financial need in order to get accepted. 

Lastly, make sure your student applies for any scholarships or grants they may qualify for.

And don't forget to talk to your child's college admissions office about their financial aid package. Many students and parents (who are often footing part of the bill) don't realize that financial aid packages can be rejected or negotiated, and can be different every year. 


Have you found the college that's the right financial fit for your student?