Skip to comments.Is college worth it?: Too many degrees are a waste of money.
Posted on 04/05/2014 5:06:23 AM PDT by SeekAndFind
WHEN LaTisha Styles graduated from Kennesaw State University in Georgia in 2006 she had $35,000 of student debt. This obligation would have been easy to discharge if her Spanish degree had helped her land a well-paid job. But there is no shortage of Spanish-speakers in a nation that borders Latin America. So Ms Styles found herself working in a clothes shop and a fast-food restaurant for no more than $11 an hour.
Frustrated, she took the gutsy decision to go back to the same college and study something more pragmatic. She majored in finance, and now has a good job at an investment consulting firm. Her debt has swollen to $65,000, but she will have little trouble paying it off.
As Ms Styless story shows, there is no simple answer to the question Is college worth it? Some degrees pay for themselves; others dont. American schoolkids pondering whether to take on huge student loans are constantly told that college is the gateway to the middle class. The truth is more nuanced, as Barack Obama hinted when he said in January that folks can make a lot more by learning a trade than they might with an art history degree. An angry art history professor forced him to apologise, but he was right.
(Excerpt) Read more at economist.com ...
Forgive me, I am not good at interpreting some charts. Would you mind explaining?
The chart tells us that quality schools and good technical schools pay an excellent return on investment, ROI. Low quality schools and art schools do not.
It depends on which school you attend and the courses you take and the career you choose.
I screwed up and sent my son to college when I should have bought him a McDonalds.
I, too, am having trouble with this chart. According to chart, it looks like one can get a degree at Harvard for a touch over $50K. That can’t be correct.
Agreed! It is a lousy graph. The far right figure in the box is the ROI, the Rate of Return on you get on the Amount, indicated by the blue bar graph, which you have Invested in your education. Probably tuition only.
As IowaMark has said, go to a quality school, preferably an engineering school, preferably a state school with lower costs and you will get a significantly higher return on the smaller amount you have invested.
Short blue bar with a higher ROI. Thus, UVa and Ga Tech (go Ramblin’ Wrecks!) are at the top of the chart and wiser investments.
I just looked at Harvard’s website. They advertise around $67K per academic year. The chart is bogus.
A good technical school provides an excellent return on investment as you pointed out. When I got out of the Marine Corps in the mid-1980s, I had sufficient money available to go to a traditional 4-year college. However, I chose a Technical School that was about 10 months of intense instruction in the very field I wanted to get into - computers.
Within 6 months, I had already landed a full-time job in the high tech industry and I had to switch to a night class in order to complete my Technical School certification. I've never looked back and I can honestly say I have a much higher income than most college grads that completed a traditional four-year "liberal arts" type program.
That's not to say that I do not value education. All my life, I continue to read several books a week, many of them non-fiction books. For example I devour books on history, management, and business. I've read just about every book written on Google, Apple, Microsoft, IBM, Wal-Mart and even McDonalds. I love to read how entrepreneurs take an idea and either create a new industry or disrupt and re-invent an existing one.
This self-learning propelled me into the ranks of upper management and I am one of the only ones at my level without a formal college degree. But that is transparent to my peers because I don't go home at night want watch six hours of sitcoms. I read books or I come to forums like this where I hone my writing skills.
Autodidacticism is definitely a viable way to go, along with learning in the workplace. Again, why study it when you can be doing it? When I got my first real job in high tech, I learned more about it in 30 days then I did in all my previous schooling.
Now there are some professions, such as medicine or law, that would require years of formal education. However, if you are looking to make it in business or high tech, all you really need is a good trade/technical school and then get out there and start doing it!
There is one factor missing from the graph, that is the effect of the available pool of graduates in certain career fields. One time long ago, graduating attorneys could command great salaries as the career field was not as saturated as it is today.
There is also another variable, the perceived value of a degree from certain schools i.e. a finance degree from Penn seemingly is of higher value than say a finance degree from a match book cover advertized correspondence college. Also the GIGO principle is at work too, schools which have very low admissions standards or which have super inflated rates of “preference” admissions can have a bias against hiring of their graduates into high paying career fields.
All IMO of course.
If you have a kid with a good GPA and test scores, there are colleges that will give merit scholarships from a few thousand to full tuition to a full ride. Those are mostly in the south and Midwest, but definitely worth the searching if you want to cut the cost down.
If you have a HS junior make sure they take their SATs or ACTs this spring. And start searching for colleges over the summer. If you have a sophomore, have them study for the PSAT. There are some automatic full rides for high scoring kids.
I agree about the prestige factor for some majors, finance being one of them. But if a kid wants to be a teacher, or an account or a nurse, sending them to $60,000 a year fancy U over State U, especially if paid with loans may not be a great decision.
Yes, and that explains the low ROI in doing so which is the underpinning of my commentary.
Thanks, I have a college freshman that was 5th out 160 in HS, Eagle Scout, many awards, etc. I’m paying around $22K out of pocket to an in state university in PA. Being a white middle class male student with married parents is a decided cost driver. The way I have it figured I’m paying for my kid and some other kid on campus.
Why didn’t you go to a community college for your first 2 years? Same requirement, same associates degree, half the money.
Reform begins at the state level with one axiom, and some statistics that getting will be as hard to get as pulling teeth from the universities.
The axiom is that the state subsidizes universities *solely* for the purpose of providing better education for its citizens resulting in better jobs for them than they could get with a high school education.
The statistics are first a listing of all academic majors in the state, compared with a list of the number of their graduates who have obtained employment in that field within six months after graduation.
At the top of the list would be Nursing, Education, and Criminal Justice, with lots of placements. At the bottom of the list would be majors like race and gender studies along with basket weaving and counting to fifteen without taking off your shoes. A LOT of college sports would be at the bottom of the list as well.
Then, the state legislator who compiled this list forwards a bill that no state funds would be used in future to subsidize these losers. If students want them enough to pay full value, good for them.
Once this bill passes, state subsidies to universities might be reduced by a third. To reduce them even further, the state should examine individual courses, and refuse to pay for utter nonsense courses like “The influence of television lesbianism on society”, and “Why white people should apologize for living.”
quote “I screwed up and sent my son to college when I should have bought him a McDonalds.”
BEST QUOTE OF THE DAY!
Look at the asterisk. “After financial aid.”
My son just earned a full scholarship for his Doctorate at Penn State. I still wonder if the 6 years to earn the degree will pay for itself vs working for 6 yrs.
“I’ve never looked back and I can honestly say I have a much higher income than most college grads that completed a traditional four-year “liberal arts” type program. “
Lib arts programs are mostly garbage. My fratmate who graduated in Languages is an exception, as he teaches in Japan and does some work for the US Embassy there.
There is a another factor. How easily can the skill you have be outsourced? A lot of people with technical degrees and skill find they cannot get decent work. Why? Because there are literally millions of people out there with the exact same skill who are willing to work for less and whose work can be transmitted over the internet.
Unless your job absolutely requires that you physically be there, you’re at risk ... no matter how good you are.
Increasingly even jobs that require you physically be there are at risk, such as doctors, because of medical tourism.
Jobs such as diagnostic analysis in medicine have been greatly outsourced to places like India.
Colleges do not explain to students that they are going to be competing with millions of people all over the world when they get out ... not just with the other degree holders in this country.
A trade that requires physical presence to do the work is a more stable bet.
I don't think the chart's numbers are too low for Harvard. Over 60% of folks at Harvard get Harvard grants for financial aid, and there are other scholarship and aid programs that bring the total up to as much as 70% or even a little more.
Harvard financial aid phases out, with one student in college, as one’s family's household income approaches about $250,000. At Harvard, median household income is somewhere around $200,000, and thus, that's why, even with the fairly generous financial aid limits, you still have 30% or so of students without any grant assistance or scholarships.
I don't know how these folks calculated the four-year cost of these schools, but it may be that they're normalizing the data to median income levels in the entire population, rather than just looking at the Harvard population in isolation.
My own son's experience was that the best deal came from our state flagship, where he was offered everything but the kitchen sink. No, wait, I think they offered that, too.
But after that full scholarship, full room and board, books, educational stipend, + spending money deal, Harvard's offer was best. Johns Hopkins, my son's first choice, was worst. And it was a pretty substantial difference. And included loans in the package (Harvard doesn't use loans in their financial aid packages).
For top students applying to the top schools, it's usually the better the school, the better the offer.
My coffee always tastes better sweetened with the tears of a philosophy major with $100,000 of student loan debt.
I agree with you, but with the low acceptance rates at top colleges, you have to have an affordable back-up plan.
My ex was considering a sociology degree when she asked what that would qualify her for. I told her she would be qualified to pursue a masters degree in sociology.
Then, she asked what a masters would qualify her for. And, I answered that she could then work on her PhD in sociology.
She asked what could she do with a PhD and I explained that her PhD in sociology would qualify her to teach sociology courses.
Good one- I have the following in my family- with their degrees- currently ALL working low paying NON Conforming to what they were trained for:
1. bachelor in media arts: part time clothing store
2. bachelor in Sociology : part time community assistance
(helps inner city youth learn soccer!
3. Masters in Music- : working in RUSSIA! minimum wage
It's true that admission to top-tier schools is difficult. Stanford, I think, had an overall admissions rate of 5.1%. That may have been just about the lowest in the country of the top schools. Harvard's regular decision (factoring out the early action kids) was a record-low 3.1%. University of Chicago is now sub-10%. But there are still a number of top-tier, or near top-tier schools with admissions rates of 15% - 25%, or even higher. Duke admits 14%. Notre Dame admits 23%. Boston College admits 29%. Boston University is at 49%. In the USNWR ratings, Duke's top-10, Notre Dame is top-20, and BU is top-50.
So, for top kids, there's a wide range of really good schools that give pretty good to great financial aid that, if you apply to more than one or two (or three or five), you should get in somewhere.
Each student's needs and desires are different, but neither of my sons applied to any of the schools around the country that sent them unsolicited offers of full scholarships. With the exception of our state flagship, they pretty much only selected schools from around the top 50 in the US.
For both my sons (the younger one is on the cusp of finishing the process as he is a high school senior this year), that was the "backup" plan - state flagship + a wide selection of top schools.
Both were admitted to our state flagship with substantial scholarship offers. Both were admitted to multiple other top-50 schools with offers of aid ranging from affordable to very affordable.
Interestingly, there seems to be an incipient move away from loans in the top schools, at least to some degree. Several of the schools that accepted my younger son came back with no-loan financial aid packages. The use of loans in my older son's financial aid package from Hopkins was probably the deal-breaker for us. That was two years ago. My younger son's offer this month came with a scholarship specifically designated to replace the normal Hopkins loan package of about $20K. The scholarship program is funded by ex-NY mayor Michael Bloomberg (JHU, '64).
We're all chucking that Mike Bloomberg’s money may help to send a right-wing crazy conservative pro-life, pro-traditional marriage, anti-statist Catholic kid to college.
He is correct.
“The world needs ditch diggers, too.”
But plumbers are paid better.
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