Finding the Value in a College Degree

In one new survey, 86 percent of respondents say college is worth the cost.

A college graduate begins the job or career search.
A college graduate begins the job or career search.

It's mid-September. Many college students are already back in the grind and prospective students are beginning their own grind: the ever-confusing and oh-so-grueling college search.

These students are trying to answer the usual questions: Where? When? How much? They're also facing another question that seems to be getting increased attention lately: Is it worth it?

Answering that question can be complicated but is definitely worth the effort, especially given the investment required. According to the Project on Student Debt, for instance, the average college grad carries more than $25,000 in student debt.

Consider the benefits: A major—and prominent—benefit of attending college is increased employment prospects. Georgetown University's Center on Education and the Workforce recently released a study on how college grads have fared during the Great Recession (and its slow recovery). Data presented in "The College Advantage: Weathering the Economic Storm" show that almost four out of every five jobs lost from December 2007 to January 2010 belonged to workers with no formal postsecondary education.

And the job gains during the recovery have not been returned to those workers; they went to those with a bachelor's degree or at least some postsecondary training. In fact, jobs have continued to disappear for those with a high school diploma or less.

In short, you're more likely to find employment if you go to college. That's a benefit.

College grads also tend to make more, which many view as a benefit. According to a study by the Pew Research Center, over a lifetime of work, the typical college graduate earns $650,000 more than the typical high school graduate. (The study also found that college graduates have more stable employment, so that's a benefit, too.)

But increased earnings should be viewed in context. A college degree doesn't guarantee high earnings. This benefit will depend on your intended major and school. How much can you really expect to earn? Compare that to how much your degree will cost. Figure out how much you have and make smart choices about how much you need.

[See which majors have the greatest return on investment.]

Consider the costs: To evaluate what you'll truly need to pay, look at net cost, not just tuition. Links to colleges' net price calculators are available through the Department of Education's College Affordability and Transparency Center. You'll also find lists of schools ranked by tuition and fees, and net price.

[Access the net price calculators of the top-ranked colleges.]

Looking at net price is crucial. Schools with lower tuition may have additional fees that drive up costs, while grants and scholarships at schools with higher tuition can lower costs. You can also use the Department's College Navigator tool to help compare schools, or search the U.S. News directory for colleges that interest you.

Once you figure out net price, carefully consider how you'll pay for school. Decisions now can make a huge difference in the future.

If you need to take out student loans, find a way to minimize borrowing, because the need to repay massive amounts of student debt can be difficult, even if you're earning more. Responses to a Pew Research Center survey conducted this year found that 48 percent of student borrowers have found it harder to make ends meet, 25 percent have found it harder to buy a home, and 24 percent said student debt impacted their career choices. (The Student Loan Ranger has many tips on how to borrow wisely and avoid spiraling debt.)

The survey also found that 86 percent of college grads found college worth the cost. And you can, too. Look at the availability of jobs and expected earnings for your intended major. Then find ways to minimize costs and student loans so you can truly recognize these benefits.

[Find employers hiring grads from your school.]

And remember the intangible benefits—to many, a college degree holds value beyond getting paid. Do your homework and borrow wisely because the true payoff is found when you go in with your eyes open and your head up.

To learn more about borrowing wisely and relief for student loans, download our free student debt manual and attend a free student debt webinar. And follow us on Twitter (use #studentdebthelp) and Facebook for news updates and tips. 
