Dollars and Sense: Is College Your Best Option?

For decades, our government, our teachers, our parents and the other authority figures that we have encountered, have assured us that a college education was essential to financial success and a full, happy life.


Let’s look at the facts!

Bill Gates, Mark Zuckerberg, Michael Dell, Ted Turner and dozens of others billionaires—all college dropouts—were apparently quite capable of achieving success in life, absent the much touted college diploma.

It would easy to suggest that these people are the exception, not the rule, and it’s true that these are exceptional people. However, they are exceptional across all levels of educational achievement. Take a look at this chart courtesy of the government’s National Center for Education Statistics:

Median annual earnings of full-time, full-year wage and salary workers ages 25-34, by educational attainment: 2011

chart college income

1 Total represents median annual earnings of all full-time, full-year wage and salary workers ages 25-34.
2 Total represents median annual earnings of young adults with a bachelor’s degree or higher.
NOTE: Full-year workers refers to those who were employed 50 or more weeks during the previous year; full-time workers refers to those who were usually employed 35 or more hours per week.
SOURCE: U.S. Department of Education, National Center for Education Statistics. (2013). The Condition of Education 2013 (NCES 2013–037), Annual Earnings of Young Adults.


Most young people look at a chart like the one above and think, “Wow! … I better get that diploma so I can earn that extra $15,020 a year!”

While this may seem to be a logical conclusion, there are many other facts not represented in this statistical analysis that need to be considered. You see, statistics can be presented in many different ways, often in ways that are biased in favor of a particular viewpoint.

Consider these Facts

To move from a high school diploma to a bachelor’s degree is a four year adventure. During that four year period, you forfeit $119,800 in earnings, based on the average earnings for a high school graduate shown in the above chart.

In a recent survey of college costs, a moderate budget for an in-state public college, clocked in at $22,261 for the academic year 2012-2013. Without considering inflation (college costs are rising dramatically each year, outpacing inflation by huge margins) four years will cost $89,044.

This means the effective cost of a four year degree is $208,844! Based upon the U.S Department of Education’s own figures, it will take almost 14 years to recoup the cost of your four year degree.

If You Borrow…

If you fund your education through student loans, the situation is bleaker still. Add interest expenses to the equation and you are easily looking at a breakeven point exceeding half your working life!

According to a recent story in the Huffington Post two-thirds of 2011 college seniors graduated with the albatross of student loan debt swinging from their necks. Congressional reports on the subject suggest that this debt is an average of 60% of a graduate’s annual income. The total student loan debt has reached $1.2 trillion dollars!

As a result, college grads are finding it difficult to buy cars, homes and other big ticket items. Student loans have pushed debt to income ratios so high that grads are unable to qualify for mortgages and auto loans. Moreover, interest rates on student loans are poised to double in just a few weeks, exacerbating an already tragic situation.

Contrary to What You’ve Been Told

Despite what you’ve been told by well-meaning parents, teachers, clergy and other “learned” individuals and institutions; college isn’t the answer for everyone. Yes, if you aspire to be a doctor, lawyer, engineer, research scientist or similar professional, college is a must. However, we all know people living a full and prosperous life without the benefit of a college degree.

We have fallen into the trap of equating a formal education with success and prosperity. You probably know a number of people working in a field completely unrelated to their college degree. Within your circle of friends, acquaintances and family members, you probably know at least several happy, successful people with no college education whatsoever.

Know Thyself

Each of us has unique aspirations in life. It is our responsibility to determine what we want to accomplish in life and what the best path to achieve it might be. For many people, a college education is a valuable asset, but it’s quite possible that a formal education is not the panacea that our leaders would have us believe. Before you put yourself behind the financial “eight-ball,” you should consider the facts that you have seen here.

Take a minute to share your personal story regarding the pros and cons of higher education. Can you tell us about successful people you know who don’t have a college degree?









  • […] Everyone assured us that a college education was essential to financial success and a full, happy life. Hogwash!  […]

  • I agree. For certain professions college is a must. But for a lot of people it can be a huge waste of time and money. And if you do decide to go to college, I think it’s very important you try to avoid student loans as much as possible.

  • […] push our children to go to college, get a degree and earn more money (in theory), yet we fail to demand for our children basic instruction in our schools on how to best […]

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