01.05.11
Posted in Colleges, Debt at 6:28 pm by Matthew Bass
The National Inflation Association has released their top 10 predictions for 2011. Second from the top is the expectation that traditional colleges will begin shutting down primarily due to (1) increasing debt from construction projects, and (2) tuition costs that continue surging upwards despite the recession.
NIA expects to see a new trend of Americans seeking to become educated cheaply over the Internet. There will be a huge drop off in demand for traditional college degrees. NIA expects to see many colleges default on their debts in 2011. These colleges will be forced to either downsize and educate students more cost effectively or close their doors for good.
As students continue moving away from the traditional classroom, the cost of online learning will drop and quality will improve. Colleges without distance programs will have incentive to start their own. Rising fuel prices will also increase the attractiveness of learning from home. This is good news for distance learners.
Read the full article at NIA
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05.10.10
Posted in Debt, General at 4:22 pm by Matthew Bass
One commonly held belief about college degrees is that earning one will boost your income in your current job, or help you secure a job with a much higher starting salary than someone who only has a high school degree.
This may have been true at one point, but in recent years the earnings gap between high school and college graduates has been shrinking dramatically. Mary Pilon takes a detailed look at the earnings landscape in a recent Wall Street Journal article. It’s well worth a read whether you’re considering college for the first time or planning to return to school to earn a post-graduate degree.
One advantage to pursuing a degree via distance education is the lower cost. Combine that with the ability to work a full-time job while studying in the evening and you have a powerful alternative to the traditional college experience. Of course, it’s still a good idea to research your target career field and determine whether the cost of a college degree is truly worth the salary increase. It might not be.
Read the full article at WSJ.com
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07.02.09
Posted in Debt, General at 1:45 pm by Matthew Bass
In a recent New York Post article, Jack Hough presents compelling evidence that college degrees are no longer cost effective for most students to pursue. As he puts it:
“A student who secures a degree is increasingly unlikely to make up its cost, despite higher pay, and the employer who requires a degree puts faith in a system whose standards are slipping.”
Distance education, being a less expensive alternative, improves the cost-to-benefit ratio dramatically. For those jobs that require it, a degree earned through distance education may still be worth it.
Read the full article at NY Post
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10.14.08
Posted in Debt at 1:54 pm by Matthew Bass
As Washington unfurls its financial-market rescue, more families are weighing private bailouts of their own — of young-adult children burdened by debt.
Read the full article.
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08.16.06
Posted in Debt at 1:51 pm by Matthew Bass
Another article about paying for college comes our way courtesy of Fox News. It gives some interesting statistics about the average cost of college tuition and also provides figures on other expenses parents should be prepared to pay if their child will be living on campus.
In 2002-2003, the average annual cost (tuition, room and board) at a typical four-year public university was $9,828, while a year at a mid-range private institution averaged more than twice as much, $23,940, according to Department of Education statistics.
That should put the average cost of a bachelor’s degree at between $40,000 and $100,000.
That’s a lot of money for an average middle-class family to plunk down to send Johnnie or Sally off to school. Even figuring in the possible offset of financial aid, we’re still talking about tens of thousands of dollars. The above figures don’t include room and board, transportation, books, clothing, etc.
This brings up a fundamental question: is college an investment? If it is, it should be treated like any other investment. The costs, risks, and benefits should be weighed before making a commitment. Parents who take the time to weigh all of the options are making an informed decision. They are far more likely to escape dramatic financial suprises, even if their child ends up attending a traditional college.
Risk versus reward is a basic mantra preached by almost every investment adviser, and the same logic applies when deciding whether to choose a backpack and books over a workplace ID.
If the same logic applies then it would follow that college does have a benefit. This is only common sense. Parents have different opinions about what that benefit actually is, but most would list a good job with a healthy salary as the most important.
…it doesn’t take rocket science to see that a college degree can at least double your money-making potential.
This is true, but assuming you’re treating college as an investment, what kind of return are you getting on your money? If sending your child to a traditional college costs $100,000 per year and he ends up making $50,000 per year, is that worth it? What if your child could stay home and earn his degree via distance education for $10,000 per year, earn $12,000 per year as an intern during school, and make the same $50,000 per year after graduation? Would that be worth it?
Speaking for my brother and I, it has definitely been worth it. By pursuing degrees via distance education, we’ve received the same education at much less expense. We’ve avoided the costs of room and board, transportation, parking permits, etc. We’ve earned money while going to college. I graduated 100% debt free and David is on track to do the same.
Convention says that paying for college is supposed to be hard. It doesn’t have to be. Convention says that you should send your child out of state to a “name school.” This is rarely necessary. Weigh the options, make an educated decision, and be sure that your investment dollars are being used wisely.
Read the full article at Fox News.
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06.27.06
Posted in Debt at 10:18 am by Matthew Bass
This article published in USA Today earlier this month provides some interesting statistics on college students and debt. Did you know that the average college senior graduates with $19,000 in debt? That’s average. And, as the article highlights, the number of grads with $100,000 or more in debt is rapidly rising. Does this sound like a firm foundation to build a family and a career on? Not to me. Yet students continue getting themselves in debt by taking a conventional approach to earning a degree. By pursuing alternatives like distance education, students can minimize or even eliminate debt and graduate without that burden on them.
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