Three Reasons Why Sending Your Kids to College Is Still Worth It
Smart Solutions • April 2015
With skyrocketing tuition costs and soaring student debt, it’s a thought plaguing parents and students alike: Is higher education still worth it?
These days, yearly tuition costs $22,958 at public out-of-state colleges, and that figure climbs to $31,231 at private nonprofit colleges.1 The average graduate leaves college with about $25,0002 in student loan debt.
Even with figures that high, the answer is still yes — in the long run, college remains a solid investment. Below we outline three reasons why pursuing a college degree still makes good financial sense.
1. College Graduates Make More Money
The earning gap between high school and college graduates is the widest it has ever been. In 2013, Americans with a four-year college degree made 98% more per hour, on average, than those without a degree.2 In the early 1980s, that figure was just 64%.2 The bottom line? Going to college may cost a lot now. But not going could cost you even more over the course of your career.
2. "Better" Jobs Call for College Degrees
Positions that used to require only a high school diploma — executive assistant, insurance clerk, and tech-support specialists, for example — now require a college degree. Plus, the demand for higher-paying positions such as marketing executive, web developer, and sales manager far outweighs the number of qualified applicants,3 making having a college degree a definite competitive edge.
3. Unemployment Rates Are Lower for College Grads
Not only does a college degree help you get a job, it may also help you keep one. Over the course of their careers, college graduates are less likely to find themselves unemployed. The unemployment rate for college graduates ages 25 to 32 is 3.8% — that rate climbs to 12.2% for those with only a high school diploma.4
Financial Resources Available
The good news is that there are a variety of resources for students needing assistance paying for college, including grants, scholarships, federal aid, and tax-advantaged savings plans. (See below for more information about the benefits of 529 college savings plans.)
And if those resources still don’t meet the gap between the cost of attendance and what you can afford out of pocket, private student loans* can be a viable option. These types of loans offer competitive rates and flexible repayment options, plus you may borrow the maximum amount needed.
An investment in a college education is an investment in future earning potential.
Interested in learning more?
- * Terms, conditions, and limitations apply.
- "Trends in College Pricing 2014," by Sandy Baum and Jennifer Ma, The College Board, accessed March 3, 2015
- "Is college worth it? Clearly, new data say," by David Leonhardt, New York Times, posted May 27, 2014, accessed March 12, 2015
- "10 Jobs in High Demand That Require a College Degree," by Kathryn Dill, Forbes, posted Dec. 1, 2014, accessed March 3, 2015
- "The Rising Cost of Not Going to College" Pew Research Center, posted Feb. 11, 2014, accessed March 26, 2015
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