About 12 years ago, just a few months before Madeline was born, I began analyzing the best methods of saving for college. There were many opinions, many methods and no clear path to success. So, as I’m want to do when confused, I dug into it.
I took online courses to become a ‘college savings expert’, I read trade articles, I computed and calculated different inflationary scenarios to try and determine how much I’d need to save. If she gets into Harvard (we didn’t know if she was a she or a he yet) I’d need to save $800 a month! For 18 years! But my alma mater, Sonoma State, only about $250 a month. The problem was, while starting a new business, I had no idea where I’d find an extra few hundred dollars a month!
But the whole process got me to thinking on the value proposition of a university education. The calculations I was churning out showed me I’d better have anywhere from $200,000 to $600,000 saved for each child if I wanted enough saved up to pay tuition for a quality education at a reputable four year school! We had planned to have two or maybe three kids. How on Earth was I ever going to save this much? And what was I buying?
Looking back on my own college experience, I began to look at the product purchased. I received a Bachelor of Arts degree in French from Sonoma State. And there is no dispute that I received a quality education. My French is solid! Beyond my faded ability to woo a lady back in my college glory days like Pepe Le Peux, I also gained a broad “classic’ education in multiple topics, most beneficially, critical thinking.
The critical thinking I was learning at SSU was now being applied to the cost for future education. What would I be paying for? What exactly would my kids receive? Turns out, many are beginning to question this value proposition.
Many who receive a diploma do not end up working a career that has anything to do with their costly degree. Many more simply never complete their degrees, which truly is money wasted. Many find it difficult to get the classes they need to graduate. The current job market is rough on these recent grads with a lot of debt to begin paying off.
I wouldn’t trade my four years at SSU for anything. Some of the best times of my life were had during those four years. But back then, my four years totaled just under $12,000, room and board included. That barely buys one semester at SSU today.
My advice for the past few years to clients has been to push the local angle. Go to the Santa Rosa Junior College for your general education. For two years, you clear out the ‘general education’ classes for pennies on the dollar compared to SSU or Cal. Then, if that four year degree is still the goal, you’ve obtained it with much lower costs.
I think in the next decade, universities will be going through paradigm shifts. Five years ago, when I began sharing my point of view, I received looks of “Are you crazy?! Isn’t education important to you?!” Today, more folks are seeing the reality of the pursuit of higher education more clearly.
Of COURSE education is important! Nothing is more important to a person’s development, young or old. However, to pay the current rates being sold by colleges is simply being duped in most cases. Unless the degree is specific and the career after clearly linked to that degree, what exactly is the reason for these higher prices?
College admissions are beginning to be asked these questions by students and parents. Finally. Perhaps the cost of education will begin to truly reflect a competitive market? More importantly, people are no longer blindly paying any cost for any degree. They are forcing schools to justify prices and value. That will force schools to update and change. Just in time for my little angels.