Is College Worth the Cost?

The pay gap between those with degrees and those without reached a new high in 2014.

“Americans with four-year college degrees made 98% more an hour than people without a degree, up from 89% five years earlier, 85% a decade earlier, and 64% in the 1980’s” (Economic Policy Institute).

Much of the debate over the value of college stems from the immediate cost of tuition, not the long-term benefit. Tuition may be high, but the real value measured in earnings over a working lifetime is much higher.

Real value far outweighs the cost, with cost measured as tuition plus wages lost while in college. The average college grad “recoups the cost by age 40 …, after that earning over $800,000 more than the average high school graduate by retirement age” (Federal Reserve Bank of SF Economic Letter, 5/5/14).

Yes, there are stories of people who have skipped college and achieved financial success, but for most, the path to higher earnings involves a degree.

College doesn’t guarantee success … nothing does. But a decision not to attend because it might not pay off does not add up.