Does College Really Pay Off?
Skyrocketing higher education costs continue to raise questions about the return on investment students can expect from four years of college. The good news is, it’s substantial.
A report released in April 2015 by the Federal Reserve Bank of San Francisco states that earnings for those with college degrees averaged about $20,300 more per year over the past four decades than for workers without one. According to the Fed, an undergraduate degree yields a lifetime return on investment of more than $420,000, assuming costs for four years of tuition and forgone earnings totaling $112,194.
However, getting to that pay-off has become increasingly expensive for college students and their families. Tuition and fees at private nonprofit colleges totaled $31,231 on average this academic year and $9,139 for in-state residents at four-year public schools, according to the College Board. Expenses on top of that include room and board, books, and transportation which can easily add another $10,000 or more per year.
If you anticipate college costs in your future, talk to your Financial Professional about ways to fund higher education costs.