I’m a lucky guy. I didn’t do so well in high school and didn’t meet the requirements to go to university right off the bat.
Instead, I went to Community College, lived at home, worked a part-time job, and saved a sh*t load of money.
Afterward, I went to a public University and saved even more money.
I graduated during a huge recession without debt thanks to my privileged circumstances which allowed me to think less about the money I’d earn after college and more about my interests.
That being said, tuition to even state Universities has increased dramatically since I graduated – making the once realistic American dream seem a distant memory for many of us youngsters.
Today we’re going to explore the topic of why in recent years the college has become so expensive.
Just how expensive is college?
The website Collegedata.com states that one year at a public University will cost on average roughly $25,000 while at a private University it will cost $50,000.
This hasn’t always been the case. From 1984 to 2014 tuition for public universities has increased by 225%.
And to make matters more daunting, only 19% of students actually graduate at a “4” year university within 4 years – making the majority graduating within 5 or 6 years.
And while tuition goes up and it takes longer for students to graduate, on average it takes longer for college grads to earn back what they’ve spent on tuition which on average is at 36 years old.
Moreover, college grads have been earning less and less over the past 10 years while the cost of college is skyrocketing.
High education is just like a business. In fact, some say that the U.S. Department of Education makes $15 billion dollars in profit from student loans every year.
If students stopped taking out loans and going to college, our economy might just collapse. Universities want to attract students, just like businesses want to attract customers.
To do this need to hire the best professors who can conduct research in the most up to date and technologically advanced labs. This is not cheap. The average salary for a professor is $100,000.
Probably a lot more expensive than that. Universities also need to have beautifully built campuses. Again not cheap.
Not only do the buildings need to be architecturally aesthetic, but the grounds need to be taken care of and the buildings maintained.
Universities also must have attractive amenities like career services, health centers, and even psychiatric availability.
All of this costs a sh*t load of money and creates a load of competition between the universities. Consider it like an arms race education style. But that’s not all.
In order to pay for such expenses, universities create high tuition and use financial aid to help those who can’t afford it on their own and take as much as possible to those that can afford it.
This is called the Bennett Hypothesis – our government provides loans and financial aid to students, and colleges get their money whether it’s from students who take out loans, get financial aid, or can pay for it out of pocket.
If schools know that students have more money to spend, they can raise tuition, and make their campuses more attractive to potential students, which causes more competition between schools.
So when the government is providing subsidies for its citizens to go to college –there
is more demand for education now that more and more people can afford to go to college – and this, in turn, encourages colleges to charge more for education and they can increase their marketability by spending that money on professors, campus beautification or improved amenities.
The real question however is – is college worth it?
That I cannot answer.
But I will say that going to college has made me widen my perspective and allowed me to pursue ideas that I probably wouldn’t have if I had not gone.
College is about your education and an investment that will last you a lifetime.
The only answer I can give you is to think about what you are passionate about and do it.
If you don’t need a college degree to pursue your passion, don’t go.
But if you think college will enrich your life and help you obtain mastery in your passion, then go.