If you’re anything like me and still face a mountain of student debt, you may question whether that piece of paper you were handed after four years of studying and partying was worth the hassle you’ll likely face for years to come.
In fact, out of more than 1,500 respondents to a recent Salary.com survey, 35% of people said college is not worth the expense, and 43% say a college degree isn’t really necessary to succeed in life.
This may have something to do with the fact that the average American college graduate now faces more than $29,000 of student loan debt, according to recent research by the Institute for College Access & Success’s Project on Student Debt.
Even though you’re chipping away at that behemoth of a bill with monthly payments to loan companies, it’s hard not to feel discouraged when you look at what remains–have you even really made a dent?
According to the Federal Reserve Bank of New York, the outstanding student loan balance in the U.S. is about $1 trillion, and 31% of all borrowers are effectively delinquent on paying back their loans, according to recent research by the Federal Reserve Bank of New York. This number is even higher for millennials.
Despite this expensive investment in a college degree, Pew Research Center reports the average unemployment rate for 20- to 24-year-olds in 2012 was 13.3%, up almost 4% from just eight years prior. Median weekly earnings for this age group also fell from about $510 in 2001 to $464 in 2012.
When I graduated from Rutgers University, the economic bubble has just burst, and we had a new president promising to make things better–“Yes, we can” he said.
After six months of job-hunting, I was finally offered my first full-time position out of college, and I felt so lucky and grateful for it.
Before this, though, I had considered dropping out of college in my sophomore year to become a hairdresser–I was still undeclared at the time and undecided whether I wanted to pursue journalism.
My mother countered that I should first earn my college degree and then explore something else if I wasn’t happy with it. It seemed like a fair compromise at the time, and I wound up sticking with journalism.
Interestingly, there appears to be a common thread between my story and most people who have attended college: their parents encouraged them to do so.
According to Salary.com, 82% of parents want their children to go to college.
This is not too surprising, since the older you are, the more you feel college was worth it: while only about half of millennials think college is a worthwhile investment, about three quarters of baby boomers are pleased with their decision to attend college.
This may be largely due to the soaring cost of attending college and the need to use loans to leverage that cost: it now costs on average more than $18,000 for tuition, fees, room, and board for a full-time student at an in-state public university, according to the nonprofit college entrance examination organization, College Board.
More than half of millennials said they financed these costs through student loans as compared to only 29% of baby boomers who did so. More than a third of millennials say student loans are their “biggest financial concern,” according to a Wells Fargo survey last year.
What’s important for education institutions to note is that almost 60% of millennials said they wished they had learned more about how loans work in school, and 31% of Salary.com survey respondents said they regret taking out loans and wouldn’t do it again if they could go back in time.
Thanks to student debt burdens, it’s taking far longer for younger Americans to start saving: according to the Federal Reserve’s most recent Survey of Consumer Finances, households headed by college-educated millennials without any student debt obligations have about seven times the typical net worth of households headed by millennials with student debt.
Without the ability to save, young people are putting off important life decisions: Salary.com found between 23% and 41% of millennials have delayed getting married, 50% to 65% have delayed buying a home, and even more have delayed contributing to retirement funds at work because of student loans.
So is skipping college an appropriate alternative, or do we need to just suck it up and pay the piper?
Despite former New York City Mayor Michael Bloomberg’s famous advice for young people to skip college and become plumbers, recent research from the Federal Reserve Bank of San Francisco shows that most people are better off in the long run for graduating from college: the average college graduate will earn more than $800,000 more than the average high school graduate by retirement age.
So it all comes down to deciding whether the up-front investment and sacrifice is worth the benefits down the road.