Is College Worth The Cost?
The individual debt for college graduates in the United States is now above $30,000. Meanwhile, all of the world’s knowledge is nearly free because of the Internet. And we’re transitioning from a jobs economy to a skills economy. So we’re at a unique crossroads that creates a new paradigm for teenagers and their parents where college may not be a guaranteed path to a better life. But what choices do we have?
My oldest son is 18. He was homeschooled and has no plans to go to college. Instead of formal school, he traveled throughout his teens with us as a family and with Project World School. He’s already visited dozens of countries. Along the way, he acquired certifications for scuba diving, driving, and as a surf lifeguard — the only three tests he’s ever taken. He’s also started a few side hustles and learned skills like audio and video editing, blogging, and construction. He still doesn’t know what he wants to do (besides travel) for his career. And that’s okay with me.
First, I’m not against college. College is a fine place for young people to grow and learn and build important networks of friends and colleagues. Yet, because the cost has gotten so out of hand for 4-year degrees, it’s simply a matter of doing a cost-benefit analysis (systematic process for calculating and comparing benefits and costs of a decision) based on the needs and desires of each individual student. Applying to college is only one way for teens to learn and grow after high school. Yet, in the current environment, some alternatives to college may be more fruitful.
Author and businessman James Altucher has been an outspoken advocate for skipping college. He’s even bribed his children not to go, to no avail. But he’s become a leading voice of why college is not necessary for success and what alternatives may be more valuable to pursue. Watch the video below for a quick overview of his take on college:
Altucher’s basic argument is that the cost of college has gone up much faster than inflation and that college debt levels now amount to years of indentured servitude for young people. He claims there are better, cheaper ways for young people to gain skills and knowledge and find success in the economy rather than starting off with a degree and debt. Additionally, he says that even if people still choose to go to college after a couple of years exploring alternatives, they’ll have a much better appreciation for the value of money and debt. So there is little downside for teens to broaden their horizons before getting into student debt.
The average cost of college plus living expenses is over $20,000 per year. Here are the average tuition costs followed by the average cost of room and board for college students.
Source: Big Future College Board
And according to College Data the cost for room and board is over $10,000 per year:
The College Board reports that the average cost of room and board in 2017–2018 ranged from $10,800 at four-year public schools to $12,210 at private schools.
This $20,000 can be spent doing something else. By starting a job or a business, young people can turn that annual expense into income, all while learning priceless skills and developing an understanding of the value of money.
Here are just a four alternatives to college worth exploring. Their potential rewards may exceed the benefits of a college degree.
Launch a Project
Take a year off from school after high school to work on a project. Do something awesome! It doesn’t have to be a formal business or a charity. Simply set a goal for yourself and set out to accomplish it. It can be to master something like chess, poker or a video game. It could be to kayak the Great Lakes or hike the Appalachian Trail. It could be to set up a better recycling center for your community or start a community garden. Do something that excites you. You could make a movie, launch a podcast, or start a blog to document and support your project.
A year into the project, your stack of new skills and lessons will become apparent. Goal setting, time management, planning, budgeting, communication, and a host of technical skills will be acquired along the way. And your project will likely cost less than a year of private college. If given the opportunity, what type of project would you do?
Cost-Benefit: Cost is less than college. Benefits appear greater than one year of prerequisite classes.
Altucher writes this about travel as an alternative to college:
Here’s a basic assignment. Take $10,000 and get yourself to India. Check out a world completely different from our own. Do it for a year.
You will meet other foreigners traveling. You will learn what poverty is. You will learn the value of how to stretch a dollar. You will often be in situations where you need to learn how to survive despite the odds being against you.
If you’re going to throw up you might as well do it from dysentery than from drinking too much at a frat party. You will learn a little bit more about eastern religions compared with the western religions you grew up with. You will learn you aren’t the center of the universe. Knock yourself out.
We can personally attest that slow-traveling in foreign countries has made our son a much richer person with no debt attached. Young travelers will definitely learn adulting, and they may even learn a second language and skills along the way. It’s hard to not learn those things when you’re thrust into that situation.
Cost-Benefit: Costs same as college. Benefits are definitely greater than English Literature and Calculus.
Start a Business
Teenagers can learn much more about economics, savings, accounting, marketing, management, government and a host of other skills by starting a small business than they will ever learn in a classroom. Ask any entrepreneur with a college degree. They will tell you they learned more in the first six months of building a business than all of their formal schooling combined.
My son started his first small business when he was sixteen. He wanted to save money for a world-schooling retreat. Instead of getting a part-time job, we agreed to help him launch a private label product on Amazon. He had to pick a product, get samples from factories, make adjustments, register a UPC, get logos made on Fiverr, design packaging, take product photos, create an Amazon listing, and arrange shipping. He also had to do the marketing and accounting. Not only did it pay for his retreat, he also bought a car from his earnings.
Cost-Benefit: Net gain in money versus cost of college. Benefits are hardly measurable.
Volunteering for charities, public projects or businesses is a powerful vehicle for networking. It also teaches all of the valuable skills associated with the activity.
Altucher asks, “What is going to serve you better in life: taking French Literature 101 or spending a year delivering meals to senior citizens with Alzheimer’s, or curing malaria in Africa?”
Besides volunteering for charities, you could volunteer through programs like Praxis that connects young people with internships and apprenticeships with exciting startups and entrepreneurs at temporary placements. This form of volunteering at sprouting businesses is on-the-job training that may be better at opening professional doors than college.
Cost-Benefit: Cheaper than college. Benefits are at least equal to a freshman year of university.
It should be noted that no matter what high school graduates decide to do, college always remains an option. In other words, just because they explore one of the alternatives above doesn’t mean they can’t attend college if achieving their goals requires it.
Ultimately, we live in incredible times where valuable knowledge and experiences can be gained in a variety of ways. College is not the only path to a successful life. In fact, sky-high costs may make college a less reliable path to financial success as skills become more coveted than degrees. It may be time to start paying more respect to the alternatives to college.