Choosing the Right College or No College: A Real-Life Analysis
Making the right decision of whether or not to send a child to college and which college to send them to must go beyond a straight financial calculation.
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My five children are now all over 20 years old. I witnessed all five, plus a stepson from a previous marriage, go through the anxiety of applying to colleges and the apprehension of waiting to receive an acceptance letter and financial awards. All six went to Millburn (NJ) High School, one of the best public schools in the country, known for its high rankings in national polls, high SAT scores, and placement of most of its students in top colleges. This fosters a highly competitive environment, in which students are shamed if they don't get admitted into a top college let alone choose not to go to college at all.
I have been through this process six times, so I have become particularly qualified at assessing the pros and cons of sending a child to college. Furthermore, my family's large sample size has created a sort of controlled experiment, in which all six children, with the same upbringing and opportunities, have had different experiences applying to and attending college.
Here is the status of each of my children in the present day and a financial analysis of their college education:
Stepson K - Current Age: 30
K graduated high school near the middle of his high school class and immediately went on to Muhlenberg College and finished in four years. K had trouble initially finding substantial permanent work and had to take a part-time job in construction. About a year after graduation, K was accepted to a position with the TSA. He is currently working there.
College cost: $160,000 (no financial aid).
Starting salary was $32,000 per year, with a potential 1 to 5 percent raise per year. Likely to eventually reach Supervisor level at $47,500 per year. Assuming zero interest on the college investment, pay back was six years. Estimated 10-year projected total earnings are $400,000.
Daughter M - Current Age: 28
M graduated high school at the top of her class and went on to a top college, Northwestern University, where she graduated in 3 1/2 years. After graduating, M immediately found employment at a Fortune 20 company, where she still works.
College cost: $200,000 (including savings for early finish and no financial aid).
Starting salary: $52,000 per year and has had continuous advancement and promotion. Top possible level is senior management with VP level requiring graduate school. Assuming zero interest on the college investment, pay back was 3 1/2 years. Estimated 10-year projected total earnings are $650,000.
Son B - Current Age: 26
B graduated in the bottom third of his class and went on to college at Seton Hall University. Despite maintaining a 3.9 GPA, B dropped out of college to pursue an acting career. Two years ago, B decided to go back to college and will graduate this year from Columbia University.
College cost: $250,000 (including partial financial aid).
Starting salary: TBD, but likely similar to his two sisters, and so we estimate $45,000 per year and 10-year projected total earnings at $600,000.
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Son Z - Current Age: 24
Z graduated at the bottom of his high school class. He immediately went on to college at Drew University, where he dropped out after one semester and went to work at a restaurant. Three years ago he started working at an electronics company where he is currently managing a medium-size retail store and supervising 15 people.
College cost: $15,000 (1/2 year, including partial financial aid).
Starting salary: $25,000 per year. Current Salary is $45,000 per year. Top potential salary is $60,000 per year. College investment payback (half year) was six months. Estimated 10-year projected total earnings are $450,000 wages plus $150,000 saved not attending college bringing him to $600,000.
Daughter R - Current Age: 23
R finished at the top of her class in high school and went on to a top college, George Washington University (Elliott School of International Affairs). She graduated magna cum laude in 3 1/2 years. R immediately found work with the government, where she currently works.
College cost: $200,000 (including savings for early finish and no financial aid).
Starting salary: $35,000. Maximum potential salary (without graduate degree) is $60,000-$70,000 per year. Assuming zero interest on the college investment, pay back will be six years. Estimated 10-year projected total earnings are $500,000.
Daughter S - Current Age: 20
S finished in the middle of her high school class and went on to Pace University. She is currently a junior and is maintaining an A average. She is projected to graduate in May of 2017.
College cost: $120,000 (with financial aid).
Starting salary: TBD, but likely similar to her two sisters, and so we estimate $45,000 per year and 10-year projected income $600,000.
M and R, were the best students as they were growing up, which continued throughout college. Not only did they want to go to college, but they also enjoyed the experience there and quickly leveraged their degrees to find jobs that pay fairly well, with relatively large projected earning potentials.
S wasn't at the top of her class in high school. She is flourishing academically and socially in college, where she enjoys the city atmosphere and internship opportunities available. She will likely earn in the same range as her sisters.
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Stepson K, was an average student, and had a mixed experience in college. He enjoyed some of the social aspects but was relieved and happy to finish. Finding work was difficult but he eventually found a steady job that required a college degree. His upside income potential is limited, but college provided a chance for him to mature and learn. It may have been better to send him to a public school and save on tuition.
B did not enjoy the college experience at 19 years old. In retrospect, it was probably not the right choice to immediately send him to college. He needed a chance to explore and experience life. When he was ready, he made the choice to return to school on his own and was able to get into a much better college than he did right out of high school. Now, at 26 he is enjoying college and he is getting more value out of the experience then he would have sans a break from school. His ability to find work should be similar to his two sisters who also graduated from top colleges.
Z hated the college experience. He was not ready for it at his time of matriculation but went because it not only was what all his siblings did, but also because it is the normal next step for graduates of MIllburn High School. Since dropping out, Y has been working steadily for five years and is earning a salary similar to his sisters. His earning potential is unclear but he has gained a lot of practical business and management experience. He occasionally discusses the possibility of going back to college but currently has no plans to do so.
What I have learned from these six experiences is that there are many paths to financial success and happiness. If your child is academically gifted and emotionally ready, then sending him or her to the best college you can is a sensible choice. However, pressuring your child to go to college when he or she is not ready is a recipe for failure. If your child is somewhere in between, the smartest decision you can make is to send him or her to the college that offers the best value economically while at the same time providing a social atmosphere conducive to the child's comfortability and success. Finally, if your child chooses not to go to college, it doesn't mean they won't be successful.
The relatively close 10-year projected incomes of all six of my children suggests that making the right decision of whether or not to send a child to college and which college to send them to must go beyond a straight financial calculation. It also involves identifying their strengths and weaknesses, understanding their likes and dislikes, intuition - and some good luck.