Is It Worth Investing in Education and College Degrees?

Andrew Deen  |


For Millennials, getting a college degree is practically an expectation. With jobs becoming more and more competitive, many people have been encouraged to get a four-year degree to impress potential employers and gain skills needed for the modern office. The problem? That comes at a cost. In 2018, student loan debt in the United States reached $1.5 trillion dollars, with the average 2016 graduate carrying $37,172 in debt—more than a years’ salary for many.

It’s not surprising that college has become almost mandatory. Everyone wants to get a good job, and college provides valuable training, education, and a transitional experience into adulthood. But with the rising cost of university programs increasing the potential debt load, is it really worth the investment? Will a degree really help you earn more and lead to career success? Let’s take a look.

Education is Changing

In the Information age, college is no longer the only way to pick up career skills. Online courses are now available for free or very cheaply, and while they won’t lead to a degree, they can help people pick up necessary career skills.

Many schools are now emphasizing their online programs, which allows for more flexibility. Even curriculums in traditional programs are shifting thanks to digital tools. In fact, 75% of teachers believe that digital textbooks and curriculums will mark the end of printed textbooks by 2026. No doubt, digital technology is changing education.

College is Expensive, and the ROI is Not Always Clear

The biggest concern for Americans considering a traditional university degree is the cost and the return on investment. Many young people with college degrees are not using their degree, or the field they have chosen does not offer high salaries. Many Millennials are dissatisfied with their work, with 2 out of 3 planning to leave their jobs by 2020. It’s hard to justify spending so much on education if it won’t necessarily help someone find career satisfaction or stability.

With that said the ROI of a degree isn’t always obvious anecdotally—but that doesn’t mean it isn’t there. The numbers don’t lie, and according to the Bureau of Labor Statistics, a person with a college degree will make an average of $1,173 weekly, while someone with a high school diploma alone will make $712. That can be a difference of $1,000,000 over a lifetime, making a debt load of under $50,000 seem reasonable.

The Highest Salaries Require Specialized Degrees

One thing that young people need to consider when deciding whether to invest in education is the type of degree they are thinking about. STEM (Science, Engineering, Technology, and Math) fields typically require at least a bachelor’s degree for employment, and those with degrees make more in these fields.

Although degrees in the arts can be very valuable, they don’t have an ROI on par with STEM degrees. It’s also easier to train for these kinds of professions through non-traditional means.

Higher Education and Master Degrees are Becoming Less Popular

Although some careers still require a master’s degree or even a doctoral degree, higher education is starting to lose its draw in the United States due to high costs and changing political tides. Disillusionment with high costs and other issues is starting to reduce public support for universities.

A Civics Analytics survey showed that 55% of respondents who were dissatisfied with four-year colleges felt the costs were too high. 43% said they failed to provide real-world skills. These attitudes could lead to fewer people pursuing degree programs or some types of programs losing popularity in coming years.

Education is Now Everywhere

Of course, some of these changes have to do with the fact that education is everywhere. There are lots of options for people who want to learn, and it’s likely that a Bachelor’s degree won’t be given so much weight during hiring as more people pursue non-traditional routes. Online courses, degree programs online, books, certificates, workshops, technical college, apprenticeships—anyone who wants to learn can.

Education will always be valuable and necessary for building a meaningful career. Going to college can be a very good investment for some or a poor financial decision, depending on the circumstances. Each student needs to decide for themselves on what they need to learn to build the skills and knowledge they need to pursue the life they want.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

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