Is a college education and/or graduate school cost effective?

Is a college education and/or graduate school cost effective?
Consider your college education as a program that is designed to produce a desired outcome.
Is it cost-effective?

Part 1
1. Write down two jobs that you had prior to entering college, or if you havent had two jobs, write down two jobs that you could have had prior to entering college.
2. Go to the Bureau of Labor Statistics website (https://www.bls.gov) and locate the most recent Occupational Employment and Wage Statistics (https://www.bls.gov/oes/current/oes_stru.htm.).
3. Look up the hourly wages of the two jobs noted in Step 1 (or jobs that most closely resemble those jobs).
4. Multiply the hourly wages by 2080 (40 hours per week x 52 weeks per year) to estimate your annual earnings.
5. For this part, let’s say that you decided not to pursue a college education or any additional certification or training. Estimate your cost of living – rent/mortgage, monthly bills, etc.

Part 2
1. Write down two jobs that you would like to hold once you have completed your education.
2. Look up the hourly wages or the average annual gross income of these jobs.
3. Find out what the minimum requirements are for the job (e.g. Associates degree, 4-year college degree, a masters degree, experience, etc.)
4. Multiply the hourly wages by 2080 to estimate your annual earnings, or look for information on the average gross annual income for the career/s you are interested in.
5. Estimate the cost of a college degree: Using your own bills, or estimates provided by your own school (include four years or more if appropriate, housing, meals, interest on student loans, etc.). If necessary, also add the cost of additional training (e.g., graduate school, professional school, certification, etc.) required for each job specified in Step 5. (Costs for additional training can be approximated by using catalogs for different schools, etc. on the Internet.)
6. If you are receiving scholarships, grants, or fellowships (do not include student loans or any private loans), subtract this from the total estimated cost of your college education.
7. The number you get after subtracting all scholarships, grants, fellowships from the total estimated cost in Step 5 is the total cost you personally invested in your education.
8. Subtract the annual income in Step 4 from the cost in Step 5. In theory, this should be the annual wage benefit of having a college degree.
7. Divide the cost of your education (found in Step 5) by the annual wage benefit found in Step 8. This is an estimate of how many years it will take to make up the cost of your education given the discrepancy in wages and other expenses you have or incur once you start working after college.
8. Write a brief cost-effectiveness report (basically a one paragraph summary) in which you evaluate the efficiency of your own college education and the long term cost-effectiveness or how your investment in your education is still beneficial even if you are not making big financial profit.

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