Your college education’s return on investment

Last week Alysa commented on my “Realistic resolutions” post, discussing the return on investment on college educations:

Education is the number one priority of everyone. Everyone aims to get a degree because that will definitely helps everyone to earn extra money. As more Americans try to figure out ways to save extra money, many people are asking: Is private college worth it? SmartMoney did a study that shows people who pay tuition and fees at private colleges don’t see a higher return on their investment, financially speaking. In fact, looking strictly at the initial cost of getting a degree and the salaries and extra money that graduates earn, Ivy Leaguers see a lower return on investments.

Our comment guidelines prevented us from including the link about the SmartMoney study Click here to learn about third-party website links, but I was intrigued about the concept offered here: quantifying the long-term value of college education. Do you get a better “bang for your buck” by choosing a private college over a public one, or vice versa?

I work in marketing, so often I’m considering the potential rate of return Click here to learn about third-party website links when developing a campaign. But I also have to consider the intangibles — benefits that you can’t necessarily see, or touch, or spend. Things like financial education components or brand awareness, which could have an impact in the future.

The same intangibles may come into play when you’re making a college choice. Sure, you want to get a solid education, pay a fair value for it, and know what your earning power will be once you graduateClick here to learn about third-party website links But things like geography, religious affiliation, professor/student ratio, and social group involvement all can give you value over time.

Because — and I know you might be surprised to hear a bank employee say this — money isn’t everything, right?

What sort of return on investment do you expect from your college education? And does public or private make a difference?

This entry was posted in College, College selection, Financial education, Looking back, Post-college, Preparing, Wells Fargo Bank. Bookmark the permalink.

2 Responses to Your college education’s return on investment

  1. Anonymous says:

    Can you refer me to a comprehensive calculator on the web to calculate the ROI and breakeven of various college degree costs, opportunity costs, risk of graduating, post college salary and post college salary delay if employment is delyed?

  2. Staci Schiller says:

    Anonymous, in all my years working in student lending I have never come across such a calculator! I just checked all my usual sources and found nothing of the sort.

    The specifics of your question lead me to believe that you might have a finance background. If so, perhaps creating this calculator could be lucrative for you!

The Student LoanDown

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