While some students will be able to go to college only if they receive financial aid and others have the resources to go wherever they want, most fall into a middle group that has to answer this question: Do they try to pay for a college that gave them little financial aid, even if it requires borrowing money or using up their savings, because it is perceived to be better, or do they opt for a less prestigious college that offered a merit scholarship and would require little, if any borrowing? It’s not an easy decision.
The average cost of tuition at a private college is $29,056. That high price is worth it only if it guarantees significantly higher wages post graduation. Unfortunately, two studies have found that that’s not necessarily the case: Students of equal intelligence perform about the same economically, regardless of the school they attend—with one important exception: students from disadvantaged backgrounds benefit from attending a more elite school. For the rest, an elite degree doesn’t seem to offer much beyond prestige.This news isn’t entirely surprising to us. Particularly gifted students have always found ways to succeed regardless of the school they attend. Indeed, for a special few, college isn’t even necessary at all—a fact the Thiel fellowship, which offers $100,000 to young entrepreneurs in lieu of college, taps into.Even if there were some sort of special advantage to an elite education, given the changes sweeping through higher ed today we would expect that secret ingredient to leak in the future. The rise of MOOCs and other online courses will make it easier for a wider range of students to gain access to top-flight courses, judged on a “stuff learned” basis.The average student still benefits from attending college, but shelling out big bucks for a degree from a big-name school may not be worth it if you’re looking for future earning potential.[Image courtesy of Shutterstock]