Growing up, I had a grandmother who would set up her soapbox and proclaim from the ends of the earth “college or bust!” For without a four year degree, we could expect to make a living flipping burgers and live in a life of poverty and shame.
Interestingly enough, a decade later, that same grandmother, who is known for her Wall Street Journal article clippings that seem to gather in piles around the four corners of my house, sent an article entitled “Is a College Education Still Worth the Investment” by Joseph Slife. Observing my brother’s current crisis with student loans and nothing but a low-paying entry-level job to make up the difference, I was intrigued; I have had my misgivings about the college education investment for a while.
It comes as no surprise that college tuitions are rising. News reports of tuition hikes, college endowments curtailing, and intercollegiate sports programs dwindling, as I wrote about yesterday, have peppered the headlines. It is an uncertain time especially when graduates are leaving the campus life to enter into a desert wasteland of job opportunities with nothing but cumbersome students loan debt weighing down their backs.
Slife, author and former college instructor, wrote in the aforementioned article “four year graduates actually tend to be at an income dis advantage to high school graduates.” He also said that “the long-held assumption that earning a college degree will yield a strong-return-on-investment may be starting to crumble.”
College tuition rates are increasing greater than the rate of inflation. According to the College Board report, Trends in College Pricing, “published tuition and fees at public four-year colleges and universities rose at an average annual rate of 4.9% per year beyond general inflation from 1999-2000 to 2009-10, more rapidly than in either of the previous two decades.”
Slife remarks in his article that despite these rising trends in college expenses, the “product,” in other words, a degree, has not risen to the quality that would parallel these lofty tuition costs. Slife also mentions that “abundant government aid is actually driving up the cost” and quoted a 2005 Cato Institute Study that “these programs are counter-productive. Basic economic theory suggests that the increase in demand for higher education brought about by a system of grants and loans will increase the price of higher education.”
In a 2008 New York Times article, it was reported that 2007 graduate and undergraduate students acquired over $143 billion in financial aid. That amount has since increased.
Sadly, going to college in today’s world comes down to a question of opportunity cost and worth. Institutions have sucked themselves into the vortex of money, money, debt, and more money, which is slowly but surely taking away the benefits to attend a four year college for the average high school graduate.
If the high school graduate or the parents are to be wise about a four year degree, they must first consider some factors:
In many cases, students who have shown prowess in certain fields or areas of industry but are not necessarily academically inclined, vocational schools or two year schools that offer a certification in a particular field can be much more beneficial on education cost and possibility for employment. Also, online courses or commuter schools that alleviate the high costs of room and board are also options you may want to consider.
Work To Save
I think, anymore, students who jump one ship to another after high school, may be making a hasty, unwise decision. There may be weight in saving money and considering/researching what options are best instead of rushing headlong into a load of debt without charting a plan for the future.
Scholarships are available, but to acquire them, it takes some effort. Exhausting the scholarship route is never a bad thing.
The student who is considering college may have 10 different reasons for wanting to go, but if only a sliver of that is to succeed academically, it may not be the best time or the wisest decision. College today is an investment—no different than how one would invest in stocks or real estate. So many young adults never look beyond what’s current and appreciate the amount of responsibility that lies ahead. If you are expecting a 4 year degree to magically earn you a comfortable income and a cushy job, think again. Chances are it may not happen overnight, if ever in the light of the current economy. That is why it is so important not to rush into a four year degree, but carefully consider your options before making your investment.
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