The average cost of college has risen more than 3,000% in the last 50 years, according to a GoBankingRates article. That’s for public schools. For private schools it’s just over 2,000%.
Granted, those are just raw numbers. But even when adjusted for inflation, that’s a 340% and 241% jump for public and private schools, respectively.
Heck, just in the past 20 years, the cost of college has nearly doubled.
As a result of these rising costs, it now takes the average borrower about 12 years to break even from college.
What does “break even” mean, exactly? It means not just earning enough to pay for the education, but also making up for the earning power lost during the college years.
And 12 years may be rather optimistic, since the average time to repay student loans is currently estimated to be 21.1 years. Now wonder there’s $1.3 trillion in student loan debt in this country!
The situation is exasperating and infuriating, and it leads many of us to ask why colleges think they can get away with this.
Well, because they can.
The advantage of a degree
The fact is that the job market has backed teens into a corner –all because of earning potential. A college graduate will earn significantly more than someone without a college degree. Approximately $1 million more in his or her career.
Sound improbable? Assuming even a $10,000 a year difference, that’s $400,000 in the course of a 40-year career. And the wage gap will likely be more substantial than that.
Not to mention that college graduates are more likely to have jobs. The current unemployment rate for grads is 2.6%, which is about 5% less than those with just high school degrees.
So what can students do to defray the high cost of education?
First, they should start early by taking advantage of concurrent enrollment opportunities during high school. This could let them graduate with an associate’s degree — or at least get them well on the way to one — along with their high school diploma.
They should also consider A.P. classes. Those classes have end-of-the-year tests that can earn as much as 15 college credits per test.
And if those chances have already passed them by? Students ought to seriously consider taking community college courses for the first two years.
Entering a university with an associate’s degree will save tens of thousands of dollars these days. They can go to the prestigious college for the last two years, getting the “good” name on the diploma for significantly less.
And of course students should see if there’s any classes they can test out of. There’s no point in paying university (or even community college) rates for English 101 if you can get out of it. Then you can spend the money on a more advanced course.
Finally: scholarships, scholarships, scholarships. And don’t forget that they aren’t just for your senior year of high school. Scholarships are available throughout your college career, so make friends with your college’s financial aid officers. They may help alert you to new scholarships that haven’t gone up on the boards yet.
Parents can help too.
You guys can make sure your students understand their loans’ implications. That is, show them what they’ll be paying each month and compare that to starting salaries. (But be sure that doesn’t push them into a field they hate just to get a higher-paying job.)
Once they have a feel for just what school will actually cost them — not abstractly, but in terms of real monthly payments — encourage them to go to a good, but perhaps not top-tier, university if it means graduating with less debt.
I was accepted to several schools, including my preferred school, Cornell. Unfortunately, the financial aid package offered was composed almost exclusively of loans. While I desperately wanted to go there, I would have graduated $100,000 in debt.
My parents encouraged me to think long and hard before committing to that kind of debt. And as much as I wanted Cornell, I simply couldn’t stomach the thought of owing six figures. Instead I opted for University of Washington, which allowed me to finish school for just over $32,000 total.
A cheaper school is an especially good idea if you think your student will end up in a graduate program (and many do these days). Employers will be looking more at the last degree earned, so save the expensive-sounding colleges for last.
Also don’t necessarily push your teen toward a regular college degree. There are a lot of certificate programs (often through community colleges, so they’re nice and affordable) that could lead to lucrative careers: HVAC, bookkeeping, phlebotomy, pharmacy technician, etc.
And they can always choose to work in those fields while saving up for a four-year degree.
Did you feel stuck when it came to high tuition? Are you worried about your kids’ college costs?