Is College Worth the Cost? Uncovering the Value of Higher Education

Each year as graduation nears, students and their parents wonder whether college is worth the cost. They face a steady barrage of unsettling headlines spotlighting the soaring cost of attending college and the nearly insurmountable debt students seemingly bury themselves in to pay for higher education.

There's no doubt going to college costs a lot of money, which we'll get into in a moment. For some students, it can be worth the investment.

However, college might not be worth the cost for everyone, especially when there may be better alternatives. Here's a closer look at how to count the cost to determine if going to college is the right move.

How much does college cost?

How much does college cost?

College costs vary significantly. Factors like the type of institution -- whether it's an in-state or an out-of-state school -- and other related expenses such as travel can lead to meaningful differences between the costs of attending different schools.

Here's a look at the average cost of college for different types of schools in the 2022-23 school year:

The cost of college can also be quite different from state to state. For example, tuition and fees for a public two-year school during the 2022-23 school year were $1,430 in California (the lowest) and $8,660 in Vermont (the highest). Meanwhile, the out-of-state premium to attend school can significantly add to the cost of attending a school in a particular state. For example, in South Dakota, the total out-of-state tuition and fees are $12,830 (the lowest in the country due to a very low out-of-state premium). Contrast this with Vermont, where the total out-of-state cost for tuition and fees is $41,980 (the highest in the nation due in part to a high out-of-state premium).

Pros

Reasons college is worth the cost

Despite the high costs, a college education can be worth the investment for many students. Reasons college is worth the cost include:

• College graduates typically make more money: According to the Bureau of Labor Statistics, workers aged 25 or older with at least a bachelor's degree had a median weekly wage of $1,588 during the second quarter of 2023. That compares to $1,010 per week for those with some college or an associate degree, $889 for high school graduates who never attended college, and $713 for those without a high school diploma.
• Many jobs require a college education: Some career paths are only open to those with a college education. For example, many professional jobs in business, social services, finance, and information technology will only consider applicants with a bachelor's degree or higher.
• Networking opportunities: The connections made in college (with fellow students, professors, tutors, etc.) can help graduates get their foot in the door to a future career opportunity. Colleges also provide career centers, job fairs, and other networking opportunities that can help graduating students start their careers.
• Become more independent: For many, going to college is their first opportunity to live independently from their parents. They often must do things for themselves for the first time, which can help them grow.
• Social bonding: College provides students with many opportunities to interact with each other. Many college students will make lifelong friends or meet their spouses at college.

Cons

Reasons college isn't worth the cost

For many students, the cost of college can be well worth the investment. However, for others, college might not be worth the expense. Here are some reasons why college might not be worth it:

• A degree isn't necessary for all career paths: While a college degree opens the door to many career opportunities, it isn't the key to every industry. Many careers in the service sector require a certification from a technical school or an apprenticeship. Meanwhile, some jobs don't require any college.
• Lack of desire for continued education: College is a lot of work. Some people don't want to continue their education right after high school. The lack of drive to gain a college education could lead a student to underperform and eventually drop out. That would be a potentially disastrous outcome because they'd have paid a lot of money, including possibly racking up student loan debt, with little to show for their investment.
• Getting a high-paying job after college isn't guaranteed: College is expensive. While it can pay off for many people by helping them land a lucrative career, that's not always the case. Economic downturns and recessions, technological innovations, and intense competition for the few available positions in a field can make it more difficult for college graduates to find a job that pays enough to make the investment worthwhile.
• The burden of debt: People handle debt differently. Some see taking out student loans to pay for college as good debt because it helps pay for an investment that could pay off over the long run. However, for others, debt is a burden, adding stress and affecting their mental health.
• College often requires a more than four-year commitment: Many students anticipate it will take four years to earn a bachelor's degree. However, several factors (e.g., repeating classes, attending less than full time, or taking semesters off) can stretch that for more years. The additional time needed to finish school can add to the costs, making it harder to recoup the investment.

Alternatives

Alternatives to college

Not everyone needs to go to college. Many alternatives might be a better option, including:

• Attending a trade school: Trade schools provide hands-on training for technical jobs like plumbing, electrician work, and mechanical jobs. These schools are often more affordable than college and require a much shorter time commitment. That can enable students to begin their careers and start earning money faster.
• Going to a community college: Attending a local community college is a much less expensive way to get an education. Students can earn an associate degree in about two years, which they can use to get a job in many fields, including healthcare. They can also transfer their credits to a four-year college to earn a bachelor's degree.
• Start taking courses online: Students who aren't ready to go to college full-time can begin by taking online classes to continue their education. Online courses can be cheaper than attending college since students don't need to pay for room and board at school or have traveling expenses.
• Begin working: Many entry-level jobs and some career paths don't require a degree. That allows people to start making money immediately without paying the high cost of attending college.
• Join the military: The military can be an excellent option for someone not ready for college right after high school. Joining the military could also help pay for college in the future.
• Start your own business: Launching a business in an industry that doesn't require specialized education can be a great alternative to college for people with an entrepreneurial drive.

Related investing topics

Is college worth the cost? The bottom line

College is expensive. Yet, for many people, the cost of college can be well worth it. Graduates typically make more money than those without a degree. That's one of the many benefits of going to college.

However, college isn't for everyone. Each potential college student will need to weigh the likely cost (and other factors) with their alternatives. They might find that going to college isn't right for them -- at least, not yet.