In terms of higher education, ROI refers to the cost of attending college (investment) versus the graduate’s future earnings (return).Because college students will be spending tens of thousands of dollars a year on education, it’s important to determine a college’s ROI before making any commitments.Earning a college degree requires a significant investment of both time and money.According to the College Board, the average cost of tuition and fees for the 2013-2014 school year was ,094 at private colleges, ,893 for state residents at public colleges, and ,203 for out-of-state residents attending public universities.In recent years, the federal government has pushed for increased transparency when it comes to college prices so many schools now provide online calculators to help students and families estimate the total net costs.The potential debt that students accrue can greatly affect ROI.These may not translate directly into financial benefits, but considering the fact that you’ll be committing a year, at the very least, of your life to being a student, they may help to keep you motivated and happy throughout the journey and can also positively affect you long after earning your cap and gown.Just because you’re pursuing a four-year degree, doesn’t necessarily mean that you’ll actually finish in four years.
It’s no surprise that an engineering degree will lead to a lucrative career, whereas a liberal arts degree will be much more varied, with some occupations even leading to little or no return at all.
The reason for making an investment in a college education is, of course, the expected return.
According to a Georgetown University Center on Education and the Workforce study, bachelor’s degree holders can expect median lifetime earnings approaching .3 million, nearly twice as much as workers with only a high school diploma.
Skyrocketing tuition rates have also lead many to question whether a degree is even worth it.
Research has shown, however, that a degree does pay off, as long as it leads to a well-paying career and not just a job at the local coffee shop post graduation.