Dynamic Strategy-Current Events
Most of us go to college after graduating high school or we get tired of working for low paying jobs so we try to better ourselves by getting an education hoping in turn it will open more doors with more pay. According to Catherine Rampell “A large majority — 73 percent — think they need more education to find a successful career, but only half of those say they will definitely enroll in the next few years.” http://www.nytimes.com/2012/06/06/business/more-young-americans-out-of-high-school-are-also-out-of-work.html. If this is the case why do so many find it difficult to go to college. There are many factors involved that could make this decision. One would be rising tuition cost or can I afford not to be employed. When thinking about going to college we have to utilize real option valuation by making decisions with questions just as financial analysts do when taking risks to make investments. What is the benefit of going to college or what is the benefit of being part of the workforce?
In recent years there has been an outcry from many including myself over the rising cost of tuition for post-secondary school. Currently there is lots of debate if it is even worth going to college anymore. Some argue that young adults can’t go to college because of cost “The average tuition at a four-year public university climbed 15 percent between 2008 and 2010, fueled by state budget cuts for higher education” Associated Press http://www.foxnews.com/us/2012/06/12/average-price-4-year-university-up-15-percent/. On the other hand if you don’t go to college what kind of income are you going to be able to make. Susan M. Dynarski and Sarah Turner, contributors at CNNMoney ( http://www.kcci.com/news/project-economy/Ignore-the-debt-hype-college-is-a-great-investment/-/9356884/14766504/-/j0cctdz/-/index.html#.T-awguIwGz0.gmail) argue that the benefits of getting a college education is still worth it and that studies have shown higher education brings higher income. “College graduates earn more than other workers. They are more likely to have health insurance and pensions.”
Prior to enrolling in college these were some of the challenges I faced when making a decision about going back to school. I really couldn’t afford not to work with having three children but I was at a point in my life where I was tired of working paycheck to paycheck. I had to decide and think of my real options even if it was taking a chance. This is my last semester at UHCL and I have no regrets of choosing to go to school over working my full time job. I would agree that rising tuition costs makes it much harder to go to school but I believe even with those rising costs it is still worth it. Even though Texas has a 6.9 % unemployment rate, the bottom line is that chances of getting a job with a degree is a lot higher than those without.
http://www.kcci.com/news/project-economy/Ignore-the-debt-hype-college-is-a-great-investment/-/9356884/14766504/-/j0cctdz/-/index.html#.T-awguIwGz0.gmail
http://www.nytimes.com/2012/06/06/business/more-young-americans-out-of-high-school-are-also-out-of-work.html
http://www.foxnews.com/us/2012/06/12/average-price-4-year-university-up-15-percent/
Sara, this is a very interesting article review especially since most of us can relate to it. Rising tuition cost is definitely a concern for many people. I have almost completed my college education but now worry about its affordability for my children in the future. I believe college education is a great investment a person can make for themselves or for their child. I feel that there are many wonderful reasons to invest in a college education: it increases earning potential, creditability, networking opportunity and provides knowledge and experience. I completely agree with you, even with the rising cost college education is still worth it.
ReplyDeleteThe idea that having a degree will give you a substantial leg up in this economy, is at best, a misnomer. Having a degree isn't what it used to be. This is evident when job fairs take place, and employers have literally 10 times more applicants than they have jobs available.
ReplyDeleteIs college worth it still? Depends on where you go, and how much you want to spend.
Vince Sampson, president of the Education Finance Council, stated that "Lenders are no longer pushing loans to people who can’t afford them." That statement should be pretty telling in itself. Quite a freudian slip there.
Student loans are one of the few debts that you can't get rid of in bankruptcy. Most fail to understand this. 27% of all student loan borrowers are more than 30 days past due (source: NY Fed). Graduates are often modern day indentured servants, with student loan debt now exceeding consumer credit card debt. Just as owning a house turned into a "right" in America, college is following in the same footsteps. The student loan bubble will burst, just as housing did, and just like last time, the government (read: taxpayers) will be footing the bill. The most egregious examples of predatory student lending are found in for profit institutions.
With all that said, if you're paying cash, then its not a terrible decision. You'd definitely be in the minority though.
In regards to unemployment rates, the devil is in the details. The U3 unemployment rate, while it is the headline number the media speaks of, excludes many pertinent details. For example, it excludes "discouraged workers", which are those who stop looking for work because they believe they can't get a job. Stunning, but true.
As more time passes lower level education is becoming less and less acceptable. Most jobs have raised their educational requirement to a bachelor’s degree at minimum. But the value of a Bachelor’s Degree is washing away as well. In order to be ahead or to have an advantage in the business world you need to take your education one step higher to somehow prove you are the better candidate. College is worth the financial struggle to secure your future, but at what cost?
ReplyDeleteMost students can not afford tuition or books. So your choice is student loans or a no school at all. The students who take student loans can be in debt for many years. These loans can destroy their credit and may even be a hindrance that carries for many years into their future.
College will always have its benefits and disadvantages, but with the way the Educational level and tuition keep rising I believe College is not worth the financial strain it puts on many families. The value of a bachelor’s will one day be the same as High School. Does another degree prove you are any smarter than you were before?
Kimberly, you bring up some very important points especially your views about a bachelors degree being the equivalent of a high school diploma.I don't know if having another degree makes you any smarter but I would like to think so. I would hope if there were two people that studied the same field that the person with a doctorate would be substantially more knowledgeable in the field than the person with a bachelors.I know some people learn their skill through experience but there is usually a cap on how far you can go within a company unless you meet their qualifications; meaning in order to be promoted any further you will need a degree. In my personal experience I feel that now with earning my first degree that I have come a long way not only with my intellectual being but also in my personal development.I remember finishing high school and not even thinking about college.College wasn't something that was talked about in my household. My parents were trying to do the best they could raising us by providing a nurturing home and putting a roof over our heads. We just didn't have the financial means to pay for college.I know now being a mother of three what kind of financial and emotional position they were in.As this is the case for many. The friends I had from high school that went off to college were making three times the amount of income I was. Of course their family put them through college so coming out of college they had no debt to carry. Usually this is something that is past down from generation to generation. If your parents went to college most likely you will go also. At my time at UHCL I have met students on both sides, those you have taken out loans to put themselves through school and those who had money set aside for them by their parents.Unfortunately, for some, circumstance make it difficult to go to college, whether it's money or another reason.My family did not have enough money to put me through school but they sure gave me lots of life lessons and one of those lessons were if you want something bad enough you will make it happen. In my opinion-the cost of college tuition is outrageous and I hope that a bachelors degree will never be the equivalent to a high school diploma but until that day comes I believe college is still worth the financial strain not only for ourselves but for future generations.
ReplyDeleteOn a personal level, the rising cost of tuition doesn't bother me. I am US Army Veteran and the government has paid for by bachelor degree, my masters degree and they will pay for my PhD when I decide to go back and get it.
ReplyDeleteHowever, for someone who does not have the government support that I have, then the rising cost of education is a serious burden. I think that getting a college education is important to individual's success. I have seen numerous studies showing that degreed individuals make more money over their life than non-degreed individuals.
I think there are many people who would like to go back to school but just cant afford it and thats a shame, but the fact of it is, that Univerisities need to make money as well. As costs rise, tuition has to rise as well to cover those costs.
As far as a college education being worth the cost, I'll borrow an answer from Dr. V, "it depends". In my person situation, it was definately worth the cost. My cost was spending two years in the US Army. I was able to travel the world, learn discipline and have my education paid for. Maybe more people could take the route I did, and not have to worry about college tuition.