How to Determine the Value of Higher Education

As college prices continue to grow at a rate of nearly 6% per year, which is greater than the rate of inflation, some may wonder if college is really worth the cost. After all, high school graduates that enter the workforce immediately can get a head start on earning income. While that’s absolutely true, research from The Foundation for Research on Equal Opportunity (FREOPP) has found that it may be financially, socially, and even physically better to play the long game, i.e. graduate from college.

The Value of Higher Education

According to Forbes, FREOPP found that of 53,000 degree programs, college graduates earned $32,112 more annually and $625,000 more over their lifetime than high school graduates. These figures even account for the income missed during the years that students are enrolled in school and not working, unlike their counterparts.

College Degrees that Earn the Most

While it has been proven that college graduates out-earn high school graduates, there are jobs for people with a bachelor’s degree that will make the college investment even more worthwhile. Unsurprisingly, most of these majors are STEM fields, according to the Federal Reserve Bank of New York. These include engineering majors, like computer, chemical, and electrical engineering, and business majors, such as finance, mathematics, and economics. But what if you don’t major in a STEM field? Will your lifetime earnings still outnumber those of high school graduates? The short answer is yes. Generally, any individual with a bachelor’s degree, regardless of their field of interest, will out-earn a high school graduate over their lifetime.

Other Lifelong Benefits for College Graduates

When it comes to determining the value of higher education, there is more to consider than lifetime income. Forbes points out that these benefits include: • Health insurance • Retirement security • Employment stability Companies that hire college graduates will entice employees with more than an income. They will offer health benefit packages for an employee’s entire family and 401K options to help individuals save for retirement. As college students prepare for their post-graduate job search, they need to educate themselves on these areas, especially as they negotiate salary and benefits packages. Their college degree guarantees them more than just income; it means security in a variety of ways. Remember to ask questions about which benefits are included in the job. Write down any details that are provided to research plans and opportunities. Doing so will help lead to more educated job offer acceptances.

Is College the Only Way to Earn More?

While college graduates make more than high school graduates, it’s not the only path after high school that can secure more lifetime earnings. According to CollegeBoard, median annual earnings for individuals with an associate’s degree were 22% higher than high school graduates. Furthermore, average lifetime earnings for associate’s degree holders are 25% higher than high school graduates. There are multiple turns to take after high school graduation: certificate programs, apprenticeships, community college, or trade school, to name a few. But whatever the route, the data points show that continuing education translates to more lifetime earnings, and the further one travels down that path, the more the income potential increases.

How to Determine the Cost of College

While it’s easy to point out the value of college, it’s harder to dissect the cost of college. With skyrocketing sticker prices, many high school students wonder if it’s worth the time, stress, and financial implications for those who may need to borrow to pay for college. First off, what is the sticker price? The sticker price is the cost listed on a college’s Cost of Attendance page. It will include tuition and fees as well as room and board prices. When you add it all up, the figure can be jaw-dropping, especially at private colleges. However, this sticker price is rarely the figure that students pay. That’s why it’s important to dig a little deeper and find the Net Price Calculator.

Net Price Calculator

A net price calculator is required on every college’s website. This calculator gives student seekers with a more accurate outlook on how much they will pay to attend that particular school. The net price calculator asks questions about GPA, standardized test scores, and more, as well as financial circumstances. Once you input the data, you’ll see the cost adjusted when estimated financial aid and merit aid are considered. Reminder: merit aid is the scholarship package you receive based on your academic performance, athletic achievement, or extracurricular involvement in high school.

Hidden Costs of College

In addition to adjusting the sticker price, students need to keep in mind the hidden costs of college. These are costs outside the scope of attending class, eating in the food halls, and studying after classes. They may include: • Some student fees • Equipment, like laptops • Textbooks and supplies • Student living expenses, like dorm room bedding, appliances, and more • Transportation • Extra funds for clothing, late-night takeout, and other miscellaneous costs Many students can account for tuition, required fees, and room and board, through their financial aid, scholarships, and parent help. However, there are still further costs that need to be considered. It may require students to get a part-time job to cover these additional expenses. If that’s the case, it may be beneficial to look for an employer who offers tuition reimbursement. Not only will you receive a paycheck, but these employers will help make payments toward your tuition.

Campus Amenities and Services

There are many benefits that come with the college experience. For example, rather than pay for a gym membership for a year, college students can use their campus fitness center(s). The cost of doing so is built into tuition, fees, and room and board costs, so even if you’re not using them, you’re paying for them. Other services include: • Career Centers for internship help, job search, and alumni network connections. • Health services, which include campus doctors, pharmacies, and therapists and counselors. • Libraries, tutoring services, and study centers provide students with the resources they need to thrive in their course studies. • Student life experiences, like concerts, socials, festivals, and more, help create a diverse, engaging campus culture. • Athletic fields, research labs, and performing arts spaces for students in those fields as well as for those who may be pursuing recreational extracurriculars. • Dining halls, laundry facilities, and food pantries to help meet students’ basic needs. These are just a few examples of campus amenities that students pay for through their tuition and fees. And if you pay for them, you may as well use them!

Successful Outcomes

Finally, students should consider successful outcomes in the value of higher education and the actual cost. A college education should be viewed as an investment, and you have to put money down to achieve a successful outcome. Fortunately, students can determine these successful outcomes before they enroll. Retention rates tell you how many students stay at a college after enrolling. Graduation rates will offer insight into how many students graduate – and sometimes, how long it takes for students to graduate, i.e. the percentage of students who graduate in four years versus those who do it in five or six. You can also speak with a representative at the campus career center to determine the job outlook for graduates of the college. Their goal is to keep track of every graduate to determine where they find work and how long it takes. In doing so, they’re able to give prospective students estimates on how long it may take to find a job and connect them with alumni in the fields they’re interested in pursuing.

Is Higher Education Right for You?

This is the question you need to be ask yourself, ultimately. Is college worth it…for me? Is there value in a college education…for me? Being confident in these answers will help determine your post-high school experience, whether entering the workforce immediately, attending school for one to two years, or going the distance for a bachelor’s, master’s, or professional degree.