How Much Is a College Degree Really Worth?October 13, 2022
A single year of college costs between $10,000 and $40,000. With such a steep price tag, it’s no wonder many people are reconsidering their plans after graduating from high school.
With the high price of a four-year degree, you may ask, “is college worth it?” The answer is — generally — yes. The median lifetime earnings of individuals with bachelor’s degrees are $1.2 million more than the lifetime earnings of those with a high school diploma.
However, that number reflects the median; not everyone will benefit so significantly from a bachelor’s degree. Whether college is worth, the expense depends on several factors, including your career goals and selected field.
Is College Worth It? 5 Factors to Consider
In the United States, a college degree has long been seen as a prerequisite for a successful career. However, with the high cost of tuition and mounting student loan debt, many people are reevaluating whether or not a four-year degree is worth it.
When deciding what to do after graduating from high school, consider these five factors:
1. Lifetime and Annual Earnings
There are several factors to consider when deciding whether or not to go to college. One of the most important is how much money you can expect to earn with a degree versus how much you can earn without one.
According to Georgetown University’s “The College Payoff” report, individuals with high school diplomas earn an average of $50,000 per year. Over their lifetimes, their median earnings will total $1.6 million.
By contrast, individuals with a bachelor’s degree average $70,000 per year, and their median lifetime earnings total $2.8 million — a difference of $1.2 million over their lifetimes.
While a college degree doesn’t guarantee financial success, it gives you a better chance at earning a higher salary.
Is going to college worth it? A key consideration in answering that question is how a degree can affect your employability. According to Cengage’s Employability Report, 62% of employers still require a degree for entry-level positions. And those with bachelor’s degrees are half as likely to be unemployed as those with only a high school education.
Earning a college degree can help secure a job in your chosen field and improve your long-term employability.
3. Other Benefits
A college degree doesn’t just improve your employment and earning prospects; there are other benefits, too.
The Association of Public & Land Grant Universities reported that those with bachelor’s degrees enjoy the following advantages:
- Lower poverty rates: The poverty rate for bachelor’s degree holders is 3.5x lower than the rate for those with a high school diploma.
- Health insurance: College graduates are 47% more likely to have health insurance through their jobs than those with only a high school education. Employers contribute 74% more to their health insurance costs even more significantly.
4. Time to Degree Attainment
A major factor in determining if college is worth the expense is the time it takes to complete a degree.
According to The College Board’s Education Pays report, college graduates who complete school in four years will earn enough relative to a high school graduate by the age of 33 to offset being out of the workforce for four years and for borrowing money to cover tuition and fees.
However, many people need more than four years to complete their degrees. And every additional year in college means a higher total cost. So, it’s important to consider how long it will take you to complete your degree when deciding if college is worth the investment.
5. Net Cost
Your net cost is the amount you and your family must pay for tuition, fees, and other education-related expenses. It’s the school’s total cost of attendance minus any scholarships or grants you received.
The majority of college graduates have student loan debt, and the amount of debt you take on and the interest rates on your loans will affect your overall cost.
Experts recommend borrowing no more than you expect to earn in your first year of full-time employment after graduation. If you don’t qualify for additional grants or scholarships and need to borrow more than that in student loans, you may want to consider other options, such as a less expensive school or a community college.
Deciding What to Do After High School
Is college worth it? Generally, a bachelor’s degree can pay off over the long run due to higher median lifetime earnings, lower unemployment rates, and future job prospects.
However, the net cost of college, the time it takes to complete a degree, and your future job prospects are important factors to consider when deciding if college is worth the time and expense it takes to earn a degree.
If you’re unsure whether or not to go to college, speak with your guidance counselor, parents, or teachers to get more information about the pros and cons of attending college. You can also research colleges online and visit campuses to get a feel for campus life. Ultimately, the decision of whether or not to go to college is a personal decision only you can make.
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