COLLEGE - GOOD FOR EVERYONE?

college cost

(Image credit: Bureau of Labor and Statistics; FHFA; Thomson Reuters, via https://sites.ed.gov/ous/2013/07/weighing-the-cost-and-value-of-a-college-decision/.)

College Debt is Now Larger Than Credit Card Debt:

Every American school child is told that they need to get a college education to prepare themselves for life. But is this actually true?

Student debt is now emerging a major financial crisis. Consumers owe more on their student loans than their credit cards. Student loans outstanding today — both federal and private — total some $1.4 trillion.

Student debt is also the only kind of debt in America that cannot be resolved with bankruptcy.

The cost of a college education in America is more expensive than it has ever been, increasing at a rate of 1200% over a period of 40 years. Tuitions at many universities exceed the cost of $40,000 per year. And the average student finishes their education with a five figure debt to show for it.

So is college truly something that everyone should pursue?

The Million Dollar Myth:

One of the most common lies is the promise that college grads will make a million more in their lifetime than those who don't have a degree. Census figures show that college grads earn an average of $57,500 a year, which is 82% more than the $31,600 high school alumni make. Multiply the $25,900 difference by the 40 years the average person works and, sure enough, it comes to a tad over $1 million. (Forbes). Yet anyone with a basic understanding of statistics knows that correlation does not equal causation.

Offsetting that million-dollar income discrepancy is the $46,700 four-year average cost of tuition, fees, books, room and board at a public school, and $99,900 at a private one–even after financial aid, scholarships and grants. Not to mention inflation. Add all this to the equation and college grads don’t pull even with high school grads in lifetime income until age 33 on average, says the College Board . Even that doesn’t include the $125,000 in pay students forgo over four years. (Forbes)

“I call it the million-dollar misunderstanding,” says Mark Schneider, vice president of the American Institutes for Research. (Forbes)

Unemployment and Underemployment:

The other problem with the million dollar myth is that it doesn't warn students that employment in a field of their choice is not a guarantee. 50% of recent college graduates are unemployed or underemployed (TIME). Of those who do have a job, half of recent college graduates are working in jobs that don’t require a degree. For fields like STEM and medical careers, we would agree that a college degree is necessary. But there are many people who go to college who really don't need to go, or who haven't been educated about the alternatives, such as looking into a trade, starting a business, or educating themselves via the resources of the internet.

The Option of Learning a Trade or Specialized Skill Set in Lieu of College:

There are an estimated 6 million jobs in America that are going unfilled. Many employers are forced to train their own workers, because these workers do not learn the needed skills at school. What is missing are workers with a specialized skill set. The more specific the job requirement, the more difficult it is to find an individual who can do the job. 67% of American manufacturing companies report difficulties finding qualified workers. Part of the problem is the cut backs in vocational training at public schools. There should be more information given on the opportunities provided by vocational training and community colleges, rather than the constant push for children to go to four year colleges.

The Online Classroom:

Much of what students learn at college is already readily available on a free online university called the "Internet." More needs to be done to create specialized online courses that can prepare a student for a specific job, rather than forcing them to pay for a four year degree that may yield limited results.

WORLD FUTURE FUND REPORTS

Rights for Student Debtors

Education Spending: An Area Where America Spends More and Gets Less

Broadband for All (Considering the internet as an alternative to college education)

WHY IS COLLEGE TUITION SO EXPENSIVE?

Why Is College So Expensive? (Andrew Jensen, 4-27-17)

Putting the Rising Cost of College in Perspective (TIME, 8-31-16)

Why College Is So Expensive, And How To Fix It (Forbes, 3-1-16)

The Real Reason College Tuition Costs So Much (The New York Times, 4-4-15)

The Tuition is Too Damn High (Washington Post, 8-28-13)

Ripping Off Young America: The College-Loan Scandal (Rolling Stone, 8-15-13)

6 reasons why college is expensive (Bank Rate, No Date)