Is College Worth It? What to Consider Before You Enroll
8 reasons to go to college
Do the math on college costs
How to measure earnings vs. debt
Even if you graduate, get a job and start earning income, college may not feel like it's worth it if you’re swimming in more debt than you can afford. Below, you can see the median income by major one year after graduating, alongside the median debt. Use it to help you decide which higher education options are best for you.
The calculation accounts for about 33% of gross income going to federal and state taxes, and 401(k) contributions. It also assumes a 10-year repayment schedule and a 4.99% interest rate, which is the 2022-23 federal student loan interest rate for undergraduate direct loans.
Keep in mind that some colleges are more expensive than others. If the median debt for your major is unaffordable based on median income, that isn’t to say you have to choose another major. Instead, consider all college and funding options available to you and compare the prices of each.
College Return on Investment Calculator
Will a degree pay off for you?
You can never predict your post-education future, but these steps can help you make the best possible choice:
Compare outcomes for different majors: Potential earnings shouldn’t be the only factor behind your choice of major; your interests and skills are important, too. But if you choose a lower-earning major, try to take on less debt to avoid being overburdened when it’s time to repay.
Assess earning potential: How easily you'll find work and how much you'll earn often depends on the degree level you earn, your major and your school. Use the calculator below to see the median debt upon graduation by major, as well as incomes one year after leaving school.
Understand college costs: The average in-state cost, including tuition and room and board, of a four-year, public university was $22,690 for the 2021-22 school year, according to the College Board. Nonetheless, many parents and high school students are unclear about what college will end up costing. A study from Fidelity, a financial services company, found that one-quarter of high school parents thought the full cost of college for one year would be less than $5,000; 38% of high school students thought the same.
Determine how much debt you'll take on: To estimate what a manageable college debt load looks like for you, aim for student loan payments that don’t exceed 10% of projected after-tax monthly income your first year out of school. For example, someone earning $34,414 a year — the median salary one year after graduating for the salaries listed in the calculator — shouldn’t be paying more than $192 a month toward student debt.
Make a plan for completion: Without a degree, you won’t reap the earnings and employment benefits of higher education. If you take out loans to start a degree and don’t finish, you’ll also be saddled with debt. Starting and not finishing a degree means you’ll be about four times more likely to default on student debt compared with college graduates, according to data cited in a 2018 report by the Brookings Institution, a nonprofit research organization focused on public policy.
