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Prediction: Colleges Will Continue to Get Schooled

The roughly 4,000 schools selling ’standard-issue’ degrees are in for a rude awakening.

It’s finally happening…

America’s most broken industry is being disrupted.

I’ve been writing about the disruption of college since 2019.

Back then, it was one of my most controversial ideas. Today? It’s becoming more and more of a reality…

Many kids are finally realizing college is a waste of money.

College is hot off the heels of a 60-year bull market.

The number of kids signing up for U.S. universities jumped 4X since 1960.

But did you know enrollments have now fallen 12 years in a row?

And the future looks bleak.

A decade ago, if you told fellow parents you weren’t pushing your kids to attend college, you’d get strange looks. You’d be known as the “delinquent” dad. Future playdates would be canceled.

Today, most Americans think college is a questionable investment. That’s a huge shift in just 10 years.

Why the change of heart?

Tuition costs have ballooned out of control over the past few decades.

As recently as 1980, you could get a four-year bachelor’s degree at a public school for less than $10K, on average.

These days, it’ll cost you $40K at a minimum… $140K for a private school… or well over $250K for an Ivy League school.

Yet tuition costs have fallen for three years running:

In short, when you have fewer people wanting to buy something, its price usually drops.

That’s why tuition costs are falling for the first time since the early 1970s.

College is having its ’Wile E. Coyote’ moment.

I was raised on Looney Tunes cartoons. Wile E. Coyote was one of my favorites.

The scrawny coyote would run off a cliff chasing Road Runner and end up suspended in mid-air. When he looked down and realized there was nothing but air below, he’d fall into a canyon.

In real life, thousands of US colleges are running straight off a cliff. But they haven’t looked down… yet.

I’m predicting many colleges will fall into the valley of death over the coming decade.

Top schools like Harvard… Yale… and Stanford will always attract elite kids and command huge tuitions. They’re disruption-proof.

But the roughly 4,000 schools selling “standard-issue” degrees are in for a rude awakening.

During the bull market, middle-of-the-road schools hiked prices year after year and were still packed to the brim. But those days are over.

You know how struggling retailers like Macy’s offer steep discounts to get shoppers in the door? Colleges are now running this playbook.

Vermont State University cut prices for out-of-state students by 33%. State schools in New York… Virginia… Nebraska… Wisconsin… South Carolina… and Tennessee have frozen tuition.

Distinguished universities are becoming discount universities.

For example, Colby-Sawyer College in New Hampshire slashed tuition for the upcoming school term by 62%!

Consulting giant Bain recently estimated the number of financially distressed colleges surged 70% compared to a decade ago.

The party is over, folks. A new disruptive tech is going to transform education.

AI will take a sledgehammer to the college machine.

AI chatbot ChatGPT attracted 100 million users in less than two months. And I’ve heard from reputable sources it’s already raking in $100+ million in subscriptions.

One of the biggest benefiters of this trend is AI chip leader Nvidia NVDA , which has surged 500% since I recommended it back in 2018.

ChatGPT isn’t only good for writing poems and delivering homework on demand.

It can also teach.

And not the ol’ “stand in front of 30 kids and lecture” teach. It can be your own personal tutor.

Say you want to learn about investing. Wouldn’t you want to be taught by the best teacher possible, like super-investor Warren Buffett?

ChatGPT allows you to do this.

Here’s “BuffettGPT” teaching me how interest rates affect the stock market:

Source: OpenAI

I’ve seen dozens of examples of parents using AI to tutor their kids.

It’s like having a personal tutor with unlimited time, patience, and knowledge to teach any subject.

And because the AI “learns” from your answers, it can detect whether your kid is a visual learner… what subjects they need to spend more time on… and where they’re naturally gifted.

AI has the potential to reinvent learning and turn our kids into geniuses.

In 1984, psychologist Benjamin Bloom identified what’s known as Bloom’s 2 Sigma Problem.

He found the test scores of students who were individually tutored… for just seven weeks… jumped from “average” to “excellent.”

Bloom showed one-on-one tutoring is the surest way to turn kids into straight-A students.

Problem was, it was impossible to give every kid their own teacher… until AI.

For example, Khan Academy built robo-tutor Khanmigo in collaboration with ChatGPT. Khanmigo is essentially a personalized teacher.

It learns your strengths and weaknesses and tailors lessons to each student’s unique needs. “Hey, I noticed you found that math question a little difficult. Let’s spend an extra hour on it.”

Duolingo is also harnessing the power of AI.

Duolingo DUOL is the world’s most-downloaded education app. It turns learning languages into a fun game. And it recently integrated ChatGPT into its app to take on the role of an AI tutor.

Roleplay is one of the new features. In short, it allows you to have real-world conversations like ordering espresso in an Italian café or asking for directions on the streets of Barcelona.

Duolingo’s stock has doubled so far this year:

Robo-tutors are like hiring a personal tutor for your kids, but for a fraction of the cost.

My fellow parents, maybe the greatest gift you can give your kids is learning how to use these new tools.

Benjamin Bloom transformed “average” students into “exceptional” students with just seven weeks of tutoring. Imagine what you can do with the help of AI over several years…

AT&T, T-Mobile and Verizon should be turning the volume up. Their current quiet murmur is just not enough.