Q. With the rising cost of college education, is it financially better off to skip college?
A. There might be quite a few reasons against getting a college degree:
But with a long working career and average higher pay (a recent Pew study shows college graduates earn about $45,500 vs. $28,000 for a high school graduate), does it really pay to get a college degree?
We can use the College Worth Calculator to run some numbers, the results are summarized below:
If the working career is 30 years after college, then the Net Present Values (discounting all the future earnings into current value) are:
From the pure financial perspective, you can tell which one has the better financial return.
Want to play around with your own assumptions? Try our College Worth Calculator by yourself.
A. There might be quite a few reasons against getting a college degree:
- 4 years without any earning
- 4 years college cost (average $10K for public and $30K for private colleges)
- Make it 5 years (Department of Education statistics show 20% of public colleges and 50% of private colleges' students couldn't graduate in 4 years)
- Add another 6 months job searching time
- Higher tax rate due to higher income
But with a long working career and average higher pay (a recent Pew study shows college graduates earn about $45,500 vs. $28,000 for a high school graduate), does it really pay to get a college degree?
We can use the College Worth Calculator to run some numbers, the results are summarized below:
If the working career is 30 years after college, then the Net Present Values (discounting all the future earnings into current value) are:
- Without a college degree: $825K
- With a degree from a public college: $1.1M
- With a degree from a private college: $786K
From the pure financial perspective, you can tell which one has the better financial return.
Want to play around with your own assumptions? Try our College Worth Calculator by yourself.
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