Is College a Good Investment ?

Many of us grew up in homes where we were told to graduate high school, go to college, get a good job, buy a house with the white picket fence, have 2.1 children, get Buffy, the dog and you will live the Good Life.

I heard this often growing up in a small town in MS where I dreamed of going to Florida A&M and UCLA. It was normal for my friends and I to talk about our college dreams, as early as middle school anticipating our fantastic, fabulous future.

However, we didn’t have any discussions around how to pay for college, though I admit tuition was far more affordable during our college school days. I was talking to a millennial who recently graduated from my Alma mater UCLA and was floored by today’s costs.

Needless to say, the cost of all post-secondary education has skyrocketed which makes paying for college/university education very expensive and leads us to today’s discussion, “Is College a Good Investment? In an article titled, What You Need to Know About College Tuition Cost, US news publishes the following annual cost of tuition for a variety of higher learning institutions on 9/17/2020:

Type of CollegeAverage Published Yearly Tuition and Fees
Public Two-Year College (in-district students)3,730
Public Four-Year College (in-state students)11, 260
Public Four-Year College (out of state)    27,120                                                         27,120 
Private Four-Year College41,426

Given these prices and our current climate, online college courses are becoming the only option for students today. I was counseling a 17 year old just yesterday, and we are weighing the pros and cons of spending such an enormous amount of money as the aforementioned costs are paid annually and must be multiplied by at least 4 years, or perhaps 5 as it takes some students longer to graduate.

This price tag coupled with the realization that online college might be their only option in the fall, many students are beginning to wonder, if they should even bother spending the money, since they won’t be able to get the in-person bonding and networking experiences. 

Again, the average tuition cost of just one year at college can range anywhere from about $11, 260 for a public, in-state university to a whopping $41, 426  for a private university.  Multiply that by four years, and the total is what I call ridiculous. And! If you’re taking out student loans to pay for college, this will put you in tens of thousands of dollars in debt before you even graduate. Here are some things I advised my mentee and perhaps this advice may be helpful to the college aged person in your life:

Given sticker prices like these and now the shift to online education, I think we working people everywhere need to brainstorm the pros and cons of a college education and also investigate/consider alternative educational programs that will also enable us to learn and earn and live the Good Life. 

Here are 4 thoughts, perhaps off the beaten path that I shared last week with my men-tee that may also be helpful to you or the “youngans” (young ones) in your life.

Major in something practical

My mother worked with a financially savvy man, others called  cheap, and I’ll call Sandy. He advised me to “Major in something practical.” In other words, major in something that will land you a high paying job. The best implementation of this strategy comes from a story about a very smart friend.

In his Senior year of high school, he looked in the employment section of a newspaper and majored accordingly. For you “youngans”, the newspaper is probably where your parents looked for work and kept up with current events. Put a quarter in the slot to gather worldly news daily or weekly news, much like accessing the internet today. He saw multiple posts for IT work and pursued an educational route that led him to his primary career choice. Studying IT was my friend’s way of majoring in something practical, work that is in demand, enjoyable and provided financial stability.

Keeping with this tip, a STEM career is the way of today and the future. STEM means: Science, Technology, Engineering and Math. STEM Careers to name a few: Geo-scientists. Bio-chemists. Civil Engineering. These categories represent just a few of the high paying careers of today and tomorrow.  

Creative Financing

A second consideration around college attendance involves determining the best financial avenue to take that either minimizes debt or  requires no student loans at all. 

I was fortunate enough to attend UCLA at a time where tuition, textbooks and the cost of living was less. I also stayed at home for the first few quarters to keep expenses down. Eventually,  I interned and worked to earn money to pay for food, clothing and shelter in that same off campus apartment. One thing I hold fast to and have expounded on in this linked video is to keep costs down. I go into more detail regarding several specific actions you can take to pay for college without going into a lot of debt, check out this linked video.

One way to minimize costs is to attend a community college for your General Ed. or breadth requirements. Attendance at a community college is the least expensive avenue to a post-secondary education and most make transferring to a major university in your city relatively easy.

I must also invoke Big Mamas wisdom again, those “tried and trues” that don’t change and that is encourage your children to make GREAT grades and maintain a GREAT attitude i.e. mind their Cums. Intern. Get an apprenticeship. 

The ultimate goal is get your college degree in a timely manner, 4 years, and gain some work experience along the way while getting a debt free degree. Research: Scholarships. Special grants opportunities. Research programs that help students who fall into certain classifications or experiences; grants may be available for unique circumstances and grants generally don’t have to be paid back. Pay out of pocket. I must admit I attended an affordable State college and paid out of my own pocket for my Teaching/Masters program.

Major in Your Work 

I opened this blog  by saying Major in something practical! Referring back to my IT friend, I also encourage you to “Major in Your Work!  Big Mama calls this majoring in your bent i.e. your uniqueness, your inner passion. I believe we were all born because there is something we’re born to do; not necessarily trying to find something to do. I speak about this at length in my book, Mind Over Money, How to Live like a Millionaire on any Budget. 

My IT friend was born with a desire to know how things work. His Mom shared how he was always tearing up things in an effort to figure out how they worked. She told the story of how he fell in love with his first computer received at a young age and how he invested many hours detaching, attaching, detaching and re-attaching it and others later received. In addition to IT work, he also knows how to make and build them, all before receiving a formal education in this arena. He falls into what I call the Oprah category, he gets paid to do the work he loves. What a way to make a difference in your community and your world.

Alternatives to College 

Some of us are still going to college to fulfill someone else’s expectations. I have a friend who went to law school and after practicing law for a couple years, she realized it was her family’s dream; not that of her own. Today, she is doing what she loves; selling real estate. 

Whether it’s via real estate, a trade or entrepreneurship, there are many paths to earning a good living in a way that fits your bent, burn and best financial interests. I tell you my plumber comes to my home for 15 minutes and walks away with a wage that surpasses the average hourly pay of many white-collar, salaried positions.

Learning a trade makes entrepreneurship, even more of a topic for consideration. In this ever changing world, it is wise to have multiple streams of income, which could certainly include a 9 to 5 and/or a 9 to 5 plus a side business. Of course, I practice what I preach and have invested in a successful real estate business, along with a couple other streams of income. Invest and know that investments come with huge risks.

You may be the next Elon Musk, Steve Jobs, Warren Buffett. Do your research and strategic planning, since investments come with huge risks; make sure you have a business plan and consult with your financial advisor. There are a number of websites that can help you with this including Live like a Millionaire Now.

Of course, deciding if college is right for you or not is a personal decision. Though costly, a college experience provides you with access to education, resources, internships, instructors, friendships and social experiences you can’t get anywhere else. I would also imagine the alternatives also provide you with similar encounters or varied opportunities. In this ever changing world, where online learning is becoming the norm, which shifts the in-person interactions and experiences; now may just be the perfect time to re-evaluate your specific educational interests and desires.

For more information on our upcoming workshops, check out our website and Eventbrite page. We will be teaching strategic money management and how to use money like a tool to create the life you want, live like a millionaire now and leave a proud legacy. For those of you who have interests in starting a business and real estate in particular, we will also offer strategic resources/classes as well, enroll here or at our Eventbrite page.

Join us n Facebook Livestream every Monday at 7:00pm EST. Tell, bring a friend, share and like the videos.

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