Is a college degree worth what it costs?

College is exorbitantly expensive. And it’s getting worse all the time. Currently, the average cost for one year (tuition and fees) at a private college is $30,094. At a public college or university it’s approximately $9,000 a year for in-state residents and over $22,000 a year for out-of-state residents.

With no scholarships or grants, a four year degree can leave you with somewhere between $36,000 and $120,000 in debt.

That’s an insanely deep hole in which to start out your adult life. Does it make sense to spend so much money on a degree that doesn’t guarantee you much of anything?

As part of the National Foundation for Credit Counseling's (NFCC) 2014 Financial Literacy Survey, participants were asked if they believe that their college education was a good investment. By a 2-to-1 margin, respondents believed that their college education was a good investment, and the numbers make it pretty clear why.

The truth is that there’s a massive (and growing) economic gap between those with a college degree and those without. Although it isn’t easy for today’s college graduates to find a job in their chosen field, it’s even harder to find work without a degree.

Last year, the unemployment rate for college graduates was around 4 percent – for non-graduates it was nearly twice as high, at closer to 7.5 percent.

For those who are employed, a college degree makes a staggering difference in earning ability. According to findings from the Economic Policy Institute in Washington D.C., in 2013, the average American with a four year degree made 98 percent more than the average American without a degree.

Simply put: with a four year college degree you double your likelihood of being employed and double your earning potential.

Which means that a college education is nearly mandatory in order to find satisfactory work with satisfactory wages. But what about the debt? Is that mandatory as well?

Of course it’s possible to make it through college without any student loan debt, but it’s difficult. It takes a lot of work and a lot of planning. There are grants and scholarships available. Parents, guardians, and relatives can set-up special long-term savings accounts for young children well in advance of college. You can work full or part-time while attending classes.

Your best bet is always to simply understand all of your options and create a plan that works for you. Start early. Visit for tons of helpful planning materials. And if you’ve already got student loans – whether you’ve made a payment or not – understand how they work and what your options are. MMI offers Student Loan Counseling for just that purpose.

The more you know, the more you plan, the easier it will be to handle the debt that comes with a college education.

Jesse Campbell photo.

Jesse Campbell is the Content Manager at MMI, with over ten years of experience creating valuable educational materials that help families through everyday and extraordinary financial challenges.

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