<p>SOURCE :</p>
<p><a href=“http://finance.yahoo.com/expert/article/generationdebt/43193[/url]”>http://finance.yahoo.com/expert/article/generationdebt/43193</a></p>
<p>Is College Worth the Cost? Part 1</p>
<p>by Anya Kamenetz</p>
<p>Many readers have suggested that I tackle a thorny question: Is college worth the cost? </p>
<p>Obviously, I went to college. Most other financial “experts” did, too. So the opinions we give tend to be biased in favor of the many fine experiences that our alma maters had to offer.</p>
<p>For the purposes of this column, however, I’ll put aside the important intangible benefits such as widening cultural horizons and developing critical thinking, civic participation, healthier living, and stronger relationships. In strict dollar terms, is that degree going to be worth the parchment it’s printed on for Generation Debt? </p>
<p>A Million-Dollar Education</p>
<p>On average, the answer is yes.</p>
<p>While the earnings of people with bachelor’s degrees dropped about 5 percent between 2000 and 2004, they’ll still earn an average of about $1.2 million more than high school graduates over a 40-year career. Borrowing for college, as most students do, cuts into the return on education, but not by much.</p>
<p>At the extreme end, say you paid for a private college with private loans – $133,204 at 9 percent. Over 20 years, you’d pay back almost $300,000 – still leaving a $900,000 average lifetime earnings premium.</p>
<p>Self-Knowledge Is Key</p>
<p>Unfortunately, you can’t answer this question on average – you have to approach it case by individual case. College isn’t the default option anymore for a successful life, and just like any investment, there’s risk involved. It takes self-knowledge to determine if college is going to be worth the cost for you.</p>
<p>So before enrolling in any higher education program, ask yourself the following questions: </p>
<p> What do I want to do?</p>
<p>Only about 28 percent of jobs in this country require a four-year college degree. That percentage isn’t projected to increase much in the future. Of the top 10 fastest-growing jobs over the next decade, only one requires more than a BA – ironically, the position of college instructor. (The Occupational Outlook Handbook is an invaluable resource for this and other job information.)</p>
<p>It’s true that many of the fastest-growing jobs are low-wage and in the service industry. But the nation also needs nurses and physical therapists; network systems and database administrators; veterinary and dental technicians; carpenters and plumbers; and retail and sales managers, all of which can be rewarding middle-class jobs with just an inexpensive associate’s degree.</p>
<p>There are other careers where talent, moxie, and a head start can be worth much more than a BA: actor, artist, dancer, stylist, or makeup artist; entrepreneurs of all stripes; real estate agent; retail manager; club, bar, or restaurant worker; event planner; web and graphic designer, tattoo artist, and so on.</p>
<p>So, if a job like this calls to you, don’t be afraid to sidestep college. Take a licensing exam, a business course, or an apprenticeship, and go for it. If you find that you want more education down the road, your work experience will greatly extend the benefits.</p>
<p>What if you have no idea what you want to do? While this would probably put you in the majority of traditional-age freshmen, it’s a big mistake to go to college. It makes it less likely that you’ll persevere in school, and more likely that you’ll get a degree you won’t use.</p>
<p>If you’re entering college, straining to pay for it, and are totally undirected, think about taking a year off – maybe in AmeriCorps, maybe abroad. Earn some money and find a focus. </p>
<p> Where can I get in?</p>
<p>Now let’s say you’ve zeroed in on a field that requires a BA. Lower-cost institutions such as community colleges and state universities (especially for in-state residents) may provide a better value for the money. But keep in mind that having to transfer from a two-year to a four-year school makes it more difficult to graduate. More-selective institutions generally do a better job graduating their students, too. </p>
<p>There are overpriced colleges and good values for everyone, which is why it makes sense to apply to a range of schools. Private colleges with large endowments may provide a more generous financial aid package and thus lower your cost. But here are two rules of thumb to keep in mind:</p>
<li><p>For-profit “career colleges” tend to cost far more than equivalent programs at public colleges, and there have been serious questions about the quality of the management of these schools. Before enrolling in a certificate program, vet it carefully for quality.</p></li>
<li><p>Don’t pay top dollar to go to a private college no one’s ever heard of. Prestige is part of the value of private education.</p></li>
</ol>
<p> How much can I pay for it?</p>
<p>Seek an education at a cost that will allow you to pursue the career you studied for. That means keeping down debt.</p>
<p>In a study last year, the federation of state Public Interest Research Groups (PIRGs) found that, based on their debt, 23 percent of public four-year-college graduates can’t afford to become teachers, and 37 percent can’t afford to be social workers. For private college grads, the numbers are 38 percent and 55 percent. </p>
<p>So if you want to be a social worker, don’t borrow the full cost of attendance at Hampshire College or Sarah Lawrence.</p>
<p>The highest-earning BAs are engineering and computer science students, who pulled down starting salaries of around $50,000 in 2006. According to my calculations, applying the affordability benchmarks used by the PIRGs in their study, these lucky ones can afford to borrow up to $45,000 in federal student loans. Liberal arts grads, by contrast, earn just over $30,000 in the first year out of school. If that’s your bent, it would be prudent to borrow no more than $16,000.</p>
<p> How well am I prepared to do?</p>
<p>College definitely isn’t worth it if you’re going to drop out – people with only “some college” don’t earn much more than high school graduates. Yet it’s a sad fact that the six-year graduation rate for students at four-year colleges in the United States is only 57 percent. Notice that that’s a six-year rate. Graduating in more than four years is obviously going to raise your cost of attendance. </p>
<p>So how can you buck the trend and get that degree? Do an honest assessment of yourself and your abilities.</p>
<p>If you’re deciding between colleges, choose the one that does a better job of graduating its students. Huge public universities have particular problems with this because of overcrowding and students getting lost in the shuffle. Unless you’re exceptionally dedicated and motivated, working more than 15 hours a week and/or attending part-time will hurt your chances of graduating.</p>
<p>Finally, if you need to take remedial classes in order to do college work, get those credits out of the way at a community college. Don’t pay university tuition for them.</p>
<p>Make It Pay Off</p>
<p>In the end, almost any college experience can be a good value. It depends on how you take advantage of the resources and connections offered, and what you’re willing to put into it.</p>
<p>Professor William Coplin, director of the Public Affairs Program at Syracuse University and author of “25 Ways to Make College Pay Off,” emphasizes the real-world skills you’ll need. “I don’t think it’s very important what school you go to,” he says. “The more hands-on doing stuff, the better.” </p>
<p>That means taking internships, volunteering, working jobs in a field related to your interest, and doing everything you can to get ready for the real world. </p>
<p>(In my next column, I’ll discuss whether grad school is worth the cost.)</p>