Consider Your Return on Investment When It Comes To Picking A College

There are so many moving parts to a student’s search for the ‘right’ college location, academic options, student services, clubs, and organizations, career preparations – but none of them matters if a family cannot afford that outstanding education. Attending college is a privilege and one that costs a great deal of money. For the most part, when we enter into a costly venture such as purchasing a new car, a house, or stock investments, the pros and cons of that purchase must be weighed heavily against the anticipated return on our investment or ROI. How will the costs of that purchase compare to the benefits of making that purchase? In other words, how will the net cost measure up against both potential debt and potential earnings?

Many young people graduate with thousands of dollars of debt and enter into an employment placement that typically provides an annual salary far below that level of debt. This puts new graduates into a perilous financial situation and impacts their ability to start their careers and purchase a car. Students pursuing graduate degrees
may often find themselves in debt for many years. In order to come up with a realistic and honest assessment of the costs for each college under consideration, it is essential first to calculate the true total cost of attendance – tuition, room, board, fees, transportation, entertainment, and general living expenses such as cell phone bills and traveling home for the holidays. Expect that tuition will rise, as well as fees and living costs.

Once you have a complete picture of the total cost, then it’s time to review the potential outcomes. Research career opportunities and the job placement support your college offers; review annual salaries in your chosen field; analyze the industry overall, and
be aware of any growth or cutbacks in your area of likely employment. If you
have to move to another part of the country, what costs of living are associated with that location – compare across all your possible geographic locations. Finally, analyze the overall growth of salaries in your field, alongside the cost of living adjustments and inflation. Be honest with your analysis: there is no point in entering into debt for an industry that is on the decline. Consider what happened to video stores, printing, photo finishing, and telephone apparatus manufacturing as a guide to a declining industry.

Knowing how much aid you will receive from a college is critical information in calculating return on investment. Submit your FAFSA as early as possible, and read about options for institutional aid – are there separate scholarship applications to complete? Know about the CSS Profile – does your college require this to be considered for institutional aid? Review your financial aid package very carefully. Understanding exactly the amount of financial assistance you may receive will be a big part of your calculations.

As you educate yourself on your future employment possibilities, be guided by the rule that says: never borrow more than your anticipated first year’s salary. If you find yourself outside of those parameters, look into ways of reducing your costs. Would accelerating your studies save you more money? Many high school students are able to gain college credit by successfully passing AP and CLEP exams or by taking classes at a community college while still in high school. This will reduce the time you have to spend in college to
obtain your degree. Can you get a job during your college years? Would an in-state college meet your needs and keep you within your budget? Will the “name” college yield a post-graduate income higher than a similar degree from a less prestigious institution?

For some people, money does not necessarily represent success, and immediate financial success may not mean as much as long-term satisfaction for graduates such as entrepreneurs and academics. There are some helpful resources online for you to investigate the US News Best Value Listings 2022 Best Value Colleges - National Universities | US News Rankings and the Princeton Review Best Value Colleges, Best Value Colleges 2021 Rankings | 200 Best Value Colleges | The Princeton Review.

At the end of the day, the benefits of a college degree far outweigh the burden of taking on some debt. The degree represents a sound investment in your professional future and financial well-being. College graduates earn over 80% more over a lifetime than a high school graduate, and employees without degrees may find themselves unable to advance in their fields and earn more money. So is college worth it? Absolutely, 100% yes! Just do your research and learn as much as you can about your investment.

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