With more and more college degrees being granted and higher student loan balances, when does it make sense to go to a highly selective college or to college at all? What can increase earnings more than just having a college degree.
In this episode you’ll learn:
- Who benefits the most from attending a highly selective college.
- Why income disparities exist for college graduates from different family backgrounds.
- Why student loan balances are increasing and why student loan forgiveness programs are a mess.
- What can increase earnings power in addition to having a college degree.
Show Notes
Federal Prosecutors Charge Dozens in College Admissions Cheating Scheme – Wall Street Journal
Turns Out There’s a Proper Way to Buy Your Kid a College Slot – New York Times
The Legitimate World of High-End College Admissions – Wall Street Journal
Family Background and Earnings Inequality among College Graduates – Dirk Witteveen and Paul Attewell
Dismissed By Degrees – Harvard Business School
Average Rates of Growth of Published Charges by Decade – The College Board
Completing College – National – 2018 – National Student Clearinghouse Research Center
Public Service Loan Forgiveness Report – Federal Student Aid
Here’s Why So Many Americans Feel Cheated By Their Student Loans – Anne Helen Petersen – Buzzfeed
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Episode Summary
Is admittance into one of the Ivy League universities–or any college—worth the investment required? Some parents have been sued for their fraudulent attempts to have their children accepted into prestigious colleges and universities. But do you really have to attend an Ivy League university to be successful? David explores the factors that make college worth it, while also pointing out the pitfalls to avoid when considering what school to pursue and why. Be sure to listen the whole way through this helpful and objective look at the worth of a college education.
Ivy League prestige vs. personal ambition
A driven spirit and hard work can take you far. But just how far? David explores a study that revealed ambitious students have greater earning-power, despite where they went to school. Students exemplifying initiative, motivation, and resolve do better earnings-wise. It doesn’t matter whether they go to a selective school or not. Ambition is what drives success. While on the surface, it can appear that attending a prestigious university is the determining money-earning factor, when studied through controlled variables, it was revealed that the school has little to do with the future success of the student.
Understanding what is needed in the workplace can be helpful as well. Many businesses and hiring managers use college degrees as a hiring filter. As college becomes more popular and accessible, the bar is raised higher. Many jobs now require master’s degrees—even if the skills necessary are at a more elementary level. Knowing the amount of schooling necessary for your desired position can boost the impact of your education on your earning power.
Overcoming setbacks through a college education
There are challenges that come with earning a college education and what that education can bring about in the future. Discrimination and prejudice are unfortunately still a large part of the workplace and can affect the earning power of an individual belonging to a minority group. It was found that such individuals did better earnings-wise when attending a prestigious and selective university or college. This may have to do with the large network of available and supportive aid to minority groups in selective universities.
Even with such opportunities, it was discovered that those from disadvantaged backgrounds had more difficulty earning as much as their peers and classmates. The ability of parents to aid their children in funding college and acquiring a stable position after college can affect the earning outcome of a college degree. Such disadvantages can be overcome, however, through taking the time and effort to learn and being ambitious in the pursuit of understanding the needs and etiquette of the workplace.
The impact of college debt on the student’s future
Many college graduates exit their education with close to $50,000 in student debt. Is such a large sum worth the degree? One reason for the increasing student debt is the increasing debt ceiling. The allowed loan sum has steadily increased, enabling students to borrow more while also enabling universities and colleges to charge more.
Being able to pay off student debt should be a vital consideration of every prospective college student. David explores the statistics surrounding student debt and finds that those who graduate with less than $50,000 in student debt are generally able to pay it off in 10 years. Those who had $50,000 or more in student debt upon graduation struggled to pay off even 25% in 10 years.
Being realistic with the earning expectations of your degree field is important when considering how much debt to take on—if any. An engineering degree, for example, is more likely to be immediately lucrative than a liberal arts degree. David explains that the goal is to finish college. If that means going to a community college first to stem the tidal wave of student debt post-college, then it’s worth it. The prestige of a school isn’t everything, and taking on student debt should be taken seriously. Listen to the entire episode for a more in-depth look at the cost of student debt and the difficulties that arise from acquiring too much.
College is worth it—but not at any cost
Having a college degree is certainly helpful when establishing a successful career. The earning power of college graduates is higher than those without a degree. This doesn’t mean that college graduates are smarter, more capable, or more talented than those without degrees. David encourages listeners to understand that what matters is learning and understanding what you are capable of accomplishing. Sharing your work is also vital. What you give to the world is going to be more important than a slip of paper. College is important and extremely valuable. But it isn’t the culmination of success or a promise for a lucrative future.
Episode Chronology
- [0:17] The price paid by parents for their children’s prestigious degrees.
- [3:28] David’s college experience.
- [5:14] Does ambition or a selective school earn more?
- [7:44] The influence of family background.
- [9:32] The importance of college networking.
- [10:30] Overcoming discrimination.
- [12:12] College degrees as hiring filters.
- [15:45] How much student debt should you take on?
- [20:28] Student loan forgiveness.
- [23:36] Is college worth it
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