Why College Matters

Graduating from college matters most

Everywhere you look, alarm bells are ringing about the cost of college. And with some private colleges costing more than $80,000 per year, it’s easy to understand why. This can leave parents wondering if college is a good investment. 

I want to start by talking about why college matters. So often we get so caught up in the “which college” conversation that we forget why we’re saving and stressing out over college applications in the first place. And with college costs having risen completely out of whack with incomes over the past several decades, it’s important to remind yourself why college is a good investment in your child’s future. 

There’s the obvious stuff:

• Median earnings for college graduates are about 65% higher than for those without degrees

• They’ll earn almost $1,000,000 more over their lifetimes than do those with only high school diplomas

• The unemployment rate for college graduates is usually about half what it is for those without college degrees. 

But there’s more to it than that:

• Those with college degrees consistently score higher in life satisfaction and happiness surveys than do those without a college education.

• They are more likely to marry and less likely to divorce.

• College graduates even live longer and healthier lives.

All of this is before we even talk about the intellectual, social, and emotional growth that comes from exposure to new experiences, ideas and people. 

So a college degree provides tons and tons of benefits that extend well beyond the classroom learning. But you don’t have to spend $80,000 per year to get those benefits.

Consider the following:

• Do you know which college produces the most Fortune 500 CEOs? It’s not Harvard or Stanford. It’s Texas A&M. Penn State has produced more Fortune 500 CEOs than either Harvard or Stanford. 

• Harvard rejects a lot of people who go on to very successful careers. They rejected Warren Buffett, John Kerry, Tom Brokaw, and Ted Turner but accepted Ted Kaczynski.

• According to the National Bureau of Economic Research, “students who attended more selective colleges do not earn more than other students who were accepted and rejected by comparable schools but attended less selective colleges.” (The exception is that attending elite colleges does provide greater advantages to students from more disadvantaged family backgrounds.)

• Among 2020’s Rhodes Scholar recipients, 25% attended public universities that accepted more than 50% of applicants. Among the schools that have produced Rhodes Scholars in the past decade: UMBC, University of Oklahoma, Southern Connecticut State University, UC Santa Cruz, South Dakota State University, the Air Force Academy, and the Naval Academy. 

My point is that many, many colleges and universities prepare students to succeed at the highest levels. And by being open to a variety of college choices, you open the door to a college plan that meets your family’s budget and gets your student an excellent education with a minimum of debt for either the student or the parent. 

So the important thing is going to college. Which college you go to is secondary-- and definitely lower on the list than how much it costs you to go to college. As you begin the college search process, give yourself permission to limit your student’s choices to what you can afford. That might mean considering alternate pathways like community college or dual enrollment to start, or it might mean being diligent in researching merit and outside scholarships. Because going to college matters a lot more than which college you go to. 

Article excerpts & links reinforcing the value:

• CollegeData.com “Why go to college?”

  • “Graduating from college pays in the end. Data from a 2018 Georgetown University Study shows that college graduates with at least a bachelor’s degree earn almost twice as much as those with only a high school diploma and experience less unemployment over a lifetime.”

• NY Times “Will That College Degree Pay Off?”

  • “The report found that almost two-thirds of the 26,000 bachelor’s degree programs in the study enabled a majority of their graduates to make enough money to recover their costs in 10 years or less after graduation.”

Podcast: I spoke with Lew De Luca who is the Student Financial Literacy and Advising coordinator at the University of Southern Connecticut about some of the key pieces of college financial literacy.