Economic Perspective: Choosing The Best College

MARY WALDEN:

“Today’s program looks at choosing the best college. Mike, many high school seniors are now busy finishing up their college applications. There are many factors that go into picking a college for a young person to attend. From an economic viewpoint, what are the most important?”

MIKE WALDEN:

“Well I think at the top of the list is the payoff. The average college graduate will see an increase in their lifetime income of between $800,000 and $1 million expressed in today’s dollars. But this payoff varies by college. It also varies by major so I think the first thing a young person wants to look at is, for the college they’re considering and the major they’re considering, get some data on what the payoff will be if that person gets a major in that particular area.”

“Secondly I think you want to look at the rate at which freshman graduate. The average rate of freshmen graduating within six years is about 67 percent. It’s even lower, it’s under 50 percent, if you look at four years. That says something about universities because this does vary.”

“Universities and colleges where you have a higher percentage of freshmen graduating in four and six years might say something about the support that students get in terms of their studies. In terms of learning how to navigate the college world. So certainly look at that in terms of a particular college.”

“And then of course lastly, you want to look at tuition fees. You do want to look at tuition fees after you subtract support, and then what you want to do is compare that payoff. The payoff in terms of what you spend to go college and what you get back in terms of higher lifetime income.”