"Is College a Lousy Investment?" (Newsweek)

[seashoreCM]

(May be repetitive since I did not read the whole thread)

Based on my own experience, yes I felt that my college education was a lousy investment.

But it was a whole lot of fun and enjoyment.

I went to an ivy league school, which I won't name. In my opinion the main advantage of going to a "name" school is to be able to better network with alumni of that school and thereby get favored treatment in job placement. (Which I did not do.)

As far as education and learning goes, that can be equally well accomplished at community college or state college as at a "name" college.

 

[MrsPete]

I totally disagree that a big scholl is just more to offer. The environment, the classes, etc., are totally different. People like a big school, people hate a big school; if you're going to be living there for four years, taking classes, etc., you're not going to do well if it's an environment you hate.

Big schools absolutely have more to offer: Greater selection in majors, professors, housing, travel, internships, jobs, social opportunities. Big schools often have the name recognition that matters to some people /in some fields. A big school often means that the student can change majors without changing schools. There's just no doubt that a big school offers more than a small school.

You could argue that those things aren't important to you personally, or that the benefits of a small school overshadow them in your mind . . . but a big school absolutely does have more offerings more than a small one. And usually for a smaller price.

My daughter and I visited one small school, and we were so not impressed. The student body is smaller than our high school, which is neither good nor bad, but it does limit one's social life. One cafeteria. A two-story library with no technology. No sports. What it offered was almost laughable. And couldn't they have chosen a tour guide who understood subject-verb agreement? (Might not have been so offensive, if she hadn't been an English Education major.) Really, that school did not put its best foot forward for us. At slightly more than 3Xs the cost of the state school my daughter chose, I can't believe they can get anyone to attend that small school.

Also, don't forget that a great deal of variation exists within the realm of "small school" and "big school". We visited one school that has 27,000 undergrads, and we both felt it was too much of a good thing -- its size was just overwhelming. We also were a bit turned off by the fact that the school was sort of "integrated" with the town; that is, the town wove in and out of the college, and you couldn't tell where one began and the other ended. But my daughter didn't have to choose between that huge school and the miniscule, lackluster one described in the paragraph above. She ended up in a medium-sized school of 14,000. Plenty big enough to offer a wide variety of . . . well, everything, plenty big enough that everyone knows the name, plenty big enough that the costs can be kept down, but also not the urban giant of 27,000.

I think Penn would have been better for her because it is one tenth the cost. ALthough she is in a cozy environment now, I'm sure she won't think that 4 years of that is worth it in a few more years when she sees what is left of her paycheck after loan payments. She might as well skip college and work at McDonalds and make the same money.

Yeah, you have to help your 18-year old weigh the pros and cons. How strongly do you prefer that small school? Enough to postpone a nice wedding, travel, home ownership? Enough to accept a smaller paycheck for the next decade or so? Is it a matter of, "I am just paralyzed with fear when I set foot on the campus", or "I prefer small", or somewhere in between? 18-year olds just don't think this way yet.

but really, I'd rather see kids get a degree in a career field, not a hobby.

I'm all for the concept of education for education's sake . . . but with the cost of college today, few families can afford a college education that doesn't include some financial payback. I do expect my girls to come out of college better-rounded, having improved themselves as human beings, etc., etc., etc., -- but my #1 goal is for them to find work in a profitable field.

 

[crisi]

Its both a debt issue and an issue of what you major in.

If you take out $100,000 in loans (including private loans) to major in Underwater Basketweaving, that isn't an investment, that's burning your cash.

If you spend $100,000 of money your extraordinarily wealthy grandfather gave you to pursue your passion for Underwater Basketweaving, that isn't an investment - but you didn't do it to get a return on your money. Its an "investment in your personal happiness" - and one you can afford.

If you spend $50k on school for four years, paying as you go, and major in a career type job - Accounting, Education, Engineering, etc. - that is probably a good investment - both in your future income potential and in your ability to pursue a meaningful career. If you then drop that job within two years to become a stay at home mom of adorable twins - then it wasn't a good financial investment.

As to degree inflation and people in call centers having degrees - that seems like less of an argument to not get a degree. If your competition for low level jobs has some sort of post secondary education, how are you going to compete without it? Maybe $12 an hour at a call center isn't a lot of money, but its better than no money because the job went to someone with a B.A. in Underwater Basketweaving. (This statement ignores those professions that require post-secondary but non-college training - like being an auto mechanic or a stylist - those people make an investment - it wasn't a four year college, but its still post secondary education).

It seems to me that a lot of the angst over this is.

1. You can go ANYWHERE you want
2. You should PURSUE YOUR PASSION
3. The government/scholarships/school endowments will help so we won't worry about savings
4. We've set up expectation one and two, but three has fallen through.
5. We/you will take out loans and you can major in Russian Literature at Expensive Private School
6. Six years later.....what do you mean big corporations aren't lining up to hire Russian Literature majors right out of college for $60k a year? But how is she going to pay those loans! She can't afford to live on a $12 an hour call center job. This education was a bad investment!

On the other hand there seem to be far fewer

1. You should choose a college based off what you/we can afford
2. You should pursue a major that shows good post college employment prospects
3. We'll set aside savings to make this a little easier
4. All the advice followed above is taken
5. College takes a little longer, involves the student working, but the plan pays off and there are no or only small loans
6. Student gets out, and maybe its a poor economy and they work for a while at a Call Center, but with no loans its doable, while they look for something more career like and the economy sluggishly gets better.

 

[Granny square]

College is a bum deal and a waste of money for many who approach it incorrectly. FOr example, my SIL and BIL are on the verge of bankrupcy, she has lost her job, and they are spending $50,000 a year (well, there is financial aid involved and a ridiculous amount of student loans) to send their daughter to a private small college near where they live. It is a school that I have never heard of before my neice went there. It is a good school, but just not on the national radar and small, private and pricey. She could have gone to Penn State on instate tuition and scholarships that would have made her cost about $5,000 a year. ALso, when she graduates and applies for a job, any employer in the nation would know Penn State.

She is majoring in Spanish with the hopes of becoming a spanish teacher. It is wonderful that she wants to be a teacher, but if she is lucky and gets a job upon graduation, her starting salary will be under $40,000 a year before taxes. After taxes , she is looking at about $25,000 which she must live on. How the heck is she supposed to pay down the debt before she is 40? All to get an education degree that she could have gotten for one tenth the money and paid in full? When we tried to explain this to SIL and neice when they were making thier decision, neice whined and said, "but Penn State is so big, and I want to go to a small school" her parents did what ever it took to make her happy. I don't think her diploma will be as good for her as one from Penn State would be. She is saddling herself with dept all so that she can go to a small school? I don't get it. To me, a larger school just means they have more to offer. You still find your small group in your major, or your dorm, or your sorority....but there are just more small groups to choose from. Something for everyone.

To me, it's wrong for a school to take the money of a student when they can't guarantee the child will be better for it....however it is a free country, which means people are free to be stupid and selfish sometimes. Neice will be paying for this mistake for most her life, all for 4 quick years of being in her "preferred environment"

SO of course collge is a bum deal alot of the time, if you approach it in that manner. But, for the many, who go to a good budget State school and approach it more like a business decision rather than a childish decision...they will be better for it.

Lol.,why would the college be responsible for the choices of the student! Besides., by virtue of education., the student IS better off.

That said., college isn't for everyone., and if my kids want to learn a trade., join the military., or go to college,in the end it is their life.

 

[disykat]

As far as what is "better" for the neice... I think it's entirely possible that a small school is/was a "better" fit for her. That still doesn't mean she can afford it. You can't always do what is "best" and have to settle for what you can afford.

 

[DisneyMomma81]

If I was going to push one of them to reconsider it would be DD11, who wants to be a teacher - $100K+ in education (not counting eventually needing a masters or the ongoing continuing ed requirements) to earn $35K/year in a high stress job that is constantly caught in the middle of political tug-of-wars just doesn't sound like a great path to me!

I have a close *personal* friend who is a ceramics teacher at a HS, we earn the same *I'm a fed employee with a HS degree only* my job is easy, low stress. He's wanting to get his masters, maybe teach at a university or do something totally different. Teaching is a hard job and they don't get paid nearly enough.

 

[Granny square]

There isn't any reason a teaching degree needs to cost $100000. If we didn't have a scholarship the tuition would be about $6000 a year. Even if it were all loans it would be reasonable to pay off.

He lives at home because he wants to save money. He is handy to have around so I'm good about that.

I do think kids should look at the long term and choose smartly.

 

[Colleen27]

There isn't any reason a teaching degree needs to cost $100000. If we didn't have a scholarship the tuition would be about $6000 a year. Even if it were all loans it would be reasonable to pay off.

He lives at home because he wants to save money. He is handy to have around so I'm good about that.

I do think kids should look at the long term and choose smartly.

It does vary from place to place. Our community college runs about 6K between tuition, fees, and books. Tuition alone at a state university is 10K+ and where we live commuting isn't a practical option. And my DD is in 6th grade, so she's got 6 more years of 5-10% tuition increases before she starts college. 100K is likely a low estimate for a public university education for someone her age. But she's a bright, athletic, involved kid and has her sights set on small, selective, private universities so hopefully there will be scholarships in her future to help offset what our savings don't cover.

 

[Granny square]

So that is $32,000. Plus an apartment which can be reasonable if shared. Ramen noodles and cream of wheat got me through school so you can eat cheap. It is all about choices.

Also most states offer some sort of dual enrollment or cheap tuition for high school students. We had a year if credits already. Clipping into higher language level got him another 6 credits. A far better choice than the ap route.

I hope your daughter achieves her dreams in spite of you.

 

[leahjade]

A lot of it is because bachelor's degrees are a dime a dozen now. In fact the market is saturated with tons of people with Master's Degrees now as well. At the non-profit where I work, a master's is required for hire and the salary is only $30000 a year. Back when I was in college, young adults with degrees comprised less than 50% of the population and were worth more in the marketplace. A bachelor's degree is now the old high school diploma. A lot of young people would make a lot more money becoming an electician, a plumber or another trade IF that's what would make them happy!

 

[FINFAN]

A lot of it is because bachelor's degrees are a dime a dozen now. In fact the market is saturated with tons of people with Master's Degrees now as well. At the non-profit where I work, a master's is required for hire and the salary is only $30000 a year. Back when I was in college, young adults with degrees comprised less than 50% of the population and were worth more in the marketplace. A bachelor's degree is now the old high school diploma. A lot of young people would make a lot more money becoming an electician, a plumber or another trade IF that's what would make them happy!

Especially since the market is not saturated with Tradesmen to replace those who will be retiring, etc. It takes years of apprenticeship and following to aquire the skillset of those top notch in their field. Those with the skills will be able to command a better income...or at the very least will be successful for the amount of business they have if they are quality tradesmen. Looks like taking the time to aquire both skills and a degree may be the way to go. It will take more time, but really, education is on-going in todays world...so in the long run not much different in time given to learning, but maybe a better outcome.

 

[book_junkie]

I don't think college is a lousy investment, I think the way people approach it is a lousy viewpoint. I don't think that the teens that are profiled in these articles (OH, I have $xxxxxxxxxxx in debt from student loans, I didn't know) are ridiculous, and quite frankly deserve it. Harsh, but there it is.

Mini rant starting:
I was accepted into a number of different undergrad programs across the US; I went instate because it ended up being the cheapest, and I had college credits to start with (by taking community college courses during high school- my school was too small for AP). My parents didn't pay my tuition, I student loaned everything I could and worked the rest.

When I went for my masters (which is required for a librarian position at a reputable library, public, private, academic, whathaveyou), I still had my undergrad debt but was paying it off. I was also married, and my husband had his as well (he's a computer software engineer, so with his bachelor's he makes twice as much as I do with my two degrees)- smaller than mine, but still there. I went to the institution that had the best program, but lived off campus. Instead of being able to live off his income, he lost his job twice in my first semester, so I worked full time and added more student loans. We're still paying them off, but one is gone, the other almost, and the third will be gone by Christmas 2014.

My brother did the same thing- took the cheapest bachelors (agricultural mechanical engineering with minor in ecology and water management- high demand, BTW) and is paying off student loans.

Did we know what we were getting in to? YES. Are we complaining about our high student loans? NO. Were we 18 when we started? YES.

What makes these kids so special that they can't understand the consequences of their actions? You take out $xxxxxxxxxxxxxxxxxxx in debt, and you want to be underwater basketweaver, go ahead, but if you're earning $12/hour, x amount will be going to student loans every month. My husband, my brother, and I had to go every semester into financial aide (or online) and sign the papers that stated we would repay at this amount after we graduated (starting X date). If they can't figure this out at 18, then they're not ready for college.

It just ticks me off, because I work with teens that would kill for opportunities that others throw away. They don't want to become doctors, lawyers, whatever... They're trying to scrape up enough money to go to the local community college to get the certification to be a line cook. A mechanic. A cosmetologist.

 

[musicmantrs]

I think it's worth it as long as you don't go for some degree you can't/won't use. I got a BBA in Management Info Systems and I graduated in 2010 with a very soft market. It took me a while to find a job but I worked making 9$/hour with opportunity for overtime. I went on plenty of interviews but it took several months to land my current job. My job is awesome now, ESOP and a nice Roth IRA match plus my paid vacation and some travel. I would not have been able to get my job without a degree. We are trying to fill a position similar to mine and are having trouble finding someone with the skills. On the other hand my girlfriend got her undergrad in Psychology with no desire to go to grad school. She has been out of school for over a year and has had no job prospects and barely any interviews. It's all about not getting a degree in French Renaissance studies or some other "artistic" field and actually getting a degree you can use in the real world. The people I went to school with that have degrees in various business-related or engineering-related fields had much less trouble finding a full time job than people that studied in other fields.

 

[leahjade]

Our local news had a story this week interviewing students picketing at our state capital for help with student aid/loans. They interviewed a young man who graduated with $100,000 in debt with a degree in marketing and now he can't get a job and wants help with his debt. Well, duh! In our area he could have went to community college for 2 years then to a state school for a cost of $20,000 total. He could've worked his way through school for less than a car costs (like I did back in the day) but no, he had to go to a pricey private school and now wants taxpayers to foot the bill. We certainly need some education about education in this country!

 

[TheRustyScupper]

1) Whether college is worth it is a tough question.
2) Yay-side
. . . better knowledge
. . . develops a more rounded person
. . . makes you think and learn how to reason for yourself (usually)
. . . should lead to better career and better pay
3) Nay-side
. . . non-technical degrees can be dead-ends
. . . pick the wrong field, and you just get tuition bills
. . . go to a for-profit school (eg. ITT Tech) and you waste big bucks
4) Overall,
. . . engineering, computing, nursing educations can earn big bucks
. . . liberal arts degrees qualify you for McDonald's drive thru windows
. . . community college or vo-tech schools are better than 4-yr liberal arts

 

[shalom]

And a lot of people are flabbergasted that I'm not pushing DS to "set his sights higher", even though the trades he's interested in (machining primarily, or maybe welding) pay well and are experiencing/expecting shortages of qualified new hires.

My parents are horrified I'm not forcing eldest son to get in gear for college. He would have certainly gone into the Army if it weren't for his diabetes, but right now I'm guessing that the kid is headed for some kind of computer career -- he works part time now making more per hour than some college grads -- and I figure he'll get some kind of technical education, His brain is a sieve when it comes to anything literary or historic, and although he can write lucid and clear and interesting documents about anything that interests him, outside those interests... So while he's bright enough and technically capable of the work, I'm not going to try to convince him he "has" to go to college, especially when he's working with electricians who make more than most of the college grads he knows.

I do hope my kids get an education, but I'm not convinced that this necessarily means college. I expect most of my kids will go the trade school or self-education route (my brother was self-educated when he got his license as a car mechanic -- he has since gotten a college degree the usual way ). We've said we'd put them up and help them if they want to go to college, and we're willing even if they just want college for the "experience" (I knew I was never going to get a college degree I'd use and still went for a good while), but we're not willing to go into debt for it and we don't think they should, either. It was admittedly easier to go to college without debt back when I was going, but it's still doable, at least in our town.

Although I confess I'd be a lot more open to accruing debt if the kid is going for a computer degree than if they were going for one in anthropology.

 

[melancholywings]

I think it's a scam when colleges have class requirements that are not related to the field. In my Jr. College P.E. classes were a requirement. And while I think it's funny that I have credits in bowling and tennis; I shouldn't have been forced to pay for that.

I believe the future of adult education will be in online classes. A friend was telling me that where she works a B.A. is required to be a manager. They don't care what the B.A. is in, just so long as you have one. I think it's a way for them to cut management training programs.

 

[allison443]

Why do you think Penn would be a better degree for her? It's not particularly academically rigorous, it's not known for ed (or language), afaik...?

I totally disagree that a big scholl is just more to offer. The environment, the classes, etc., are totally different. People like a big school, people hate a big school; if you're going to be living there for four years, taking classes, etc., you're not going to do well if it's an environment you hate.

As well, some people do fine on their own, some need more help, interaction with professors, and that's generally stuff you cannot get at a big school - Penn is HUGE.

When my kids were looking at schools, we always heard "you can make a large school feel small, but you can't make a small school feel large." Meaning, you can find your niche, your interest group/major, sorority, etc.

Also Penn State isn't an Ivy, but like a lot of flagships it is a top 50 university (at least according to USN&WR) and well known with recruiters, plus like all large schools there is a larger, more widespread alumni network. These aren't factors to discount when students are looking for a job. Especially if the student is going to be looking for a teaching job in a certain state-they can be better off going to a state school in that state, than a private school somewhere else. More contacts, student teaching, etc. JMO.

That said, I have one kid who I think might do better at a small school. However, we cannot afford to pay $50K per year which is the going rate. So we will look at smaller state schools for her, maybe some small state schools in neighboring states as well.

 

[Granny square]

I live with two engineers... Thank God there are liberal arts people to actually make the world work. You can't make a teacher be an engineer or carpenter. So while the social or liberal sciences may pay less where would we be without teachers, social workers etc.?

 

[aquagreenpbc]

Hindsight is definitely 20/20! If I could do it all over again, I would have skipped my 4 year degree in favor of a 2 year technical degree that would have cost me less than $5,000 at a state community college and offered a lot more opportunity.

Bachelors degrees are a dime a dozen these says. Experience and being specialized is so important these days!

Luckily, I left college with less than $10,000 in debt. My saving grace? Choosing to complete my first two years at a community college.

I really do feel for parents and children these days. Very scary.