Is college worth it? Would you be better off financially if you just went to work right out of high school? According to census figures, college is definitely a great financial investment. In fact, an undergraduate degree is probably the most secure high-return investment an American can make.

Let's look at the numbers. Here are the average annual earnings for 1998, arranged by level of education:

Education Level Male Female
No High School Diploma $16,818 $8,861
High School Diploma $25,453 $13,407
Some College (one to three years) $30,536 $17,153
College Diploma $47,126 $26,401

As you can see, college grads earn about twice as much as people whose educations ended with a high school diploma. (You can also see that men earn much more than similarly qualified women, but that's a different story.) Of course, college costs money. Does the increased income make up for the cost of college? And what about the money you could have made if you started working after high school? Here are the numbers for men (the results for women are about the same):

Average in-state cost (tuition, room, and board) of a public college or university in 1996 (four years at $7,331 per year): $29,324
Four years of income lost while in college: $101,812
Total of college cost and income lost while in college: $131,136
Lifetime income with college degree: $2,120,670
Lifetime income, minus cost of college: $1,989,534
Lifetime income with just a high school diploma: $1,145,385
You can see that even after you and your parents pay for college, the $131,136 investment in college brings a return of $844,149. Put another way, the money you invest in college is likely to increase more than 600 percent. For women, the cost of tuition and forgone wages during college is $82,952; this investment brings a return of $501,779, which also calculates to about 600 percent. True, you might have to borrow some of the college cost, and the interest on the student loans adds to the cost of college. But many students get grants, scholarships, and other forms of free financial aid that more than make up for this. It's also true that going to school out of state or at a private school will cost you much more than we assumed here, but the payoff is so large over your lifetime that you'd still be way ahead.

Investing money in a college degree is also much safer than the stock market. As a college graduate, you're almost certain to earn much more than you would with only a high school diploma. For most people, the investment is a sure thing, unless you decide to become an artist or you choose some other low-wage career. And besides, in the real world, would your parents give you a hundred grand to invest in the stock market?

More Information

If you're trying to figure out the financial aid process, Four Essential Financial Aid Facts is a good place to start. Encarta's article on the Best Financial Aid Resources will help you track down financial aid on the Internet. Most people borrow at least a bit for college, and Encarta's Lessons on Loans will help you understand different types of loans. For a more detailed discussion of college tuition trends, see Colleges and Universities: Tuition. If you are interested in the stock market, see eHow's How to Get Started Investing in the Stock Market.

Just to throw you off:

My brother spent over $100K on his education to go to one of the top 10 universities in the country. He's got a job but it's nothing great. Had he taken that money and invested in Cisco and Qualcomm, he'd have $50million.

My point is that the stats are woefully skewed. Those that don't go to school do not take the money and invest it. They don'tcash the loan checks and buy stocks. They may be HS dropouts or just never finish for a variety of reasons.

here's another misleading statistic: 3 of the 5 wealthiest men in the country are college dropouts. Therefore college is a bar to super wealth.

5 people I have known since childhood come from faimlies who own a business or company

2 of them are going to inherit the faimly business baring their own death. and the other 3 will probably inherit them or run them with other sibblings.

Only 1 of them goes to College fulltime, 2 others part time, and the other 2 work full time for the fb. Out of the 5 one them has already started and sold 2 small gas distribution companies with the help of his father and is worth something more then I can even guess. The funny thing is out of the 5 this one was a summer school grad from highschool...

No College

1) age 28 ~$225,000 (IT administrator)
2) 24 ~$40,000 (webmaster)
3) 19 ~$90,000 (high school drop-out-java programmer)
4) 25 ~$45,000 phone company line repair-man
5) 26 ~$68,000 electrician
6) 27 ~$70,000 sales

College

1) 23 $45,000 Chemical engineer
2) 25 $44,000 Programmer
3) 27 $32,000 Teacher
4) 28 $50,000 Naval Aviator

My friends who didn't go to college have lots of on-the-job experience at this point. Getting jobs is easy for them. My Java programmer friend has been doing that and C++ since he was 15. Companies bid for his talent.

My friend who is a college graduate computer programmer has a MUCH harder time since he has far less experience.

College insures that your salary doesn't CAP off to early. It also gives you a better chance at getting a managerial job.

Another alternative to College is getting certified by various institutions. You promise not to have you salary cap low if you didn't. But I do see specially in the CS field, that many people that didnt graduate and got certified, got less then people that did graduate and got certified.

My repsonse to you would be threefold:

1. Consider the cost of college. Usually close to $100K for top schools. If one went to work out of high school, then when they were 23, could borrow that sum of money and start their own business, (having worked for a while) a lot of people would do better. Sure, many would fail, but many go to college and fail too.

2. The technology revolution has skewed the value of a college degree.

3. College can be responsible for sapping teh dreams of many many kids. A friend of mine is working as a claims analyst at State Farm. (That's entry level). He makes no money and hates his job. I asked him as he was bitching about it, "Did you dream about being an insurance agent when you were a little kid?"

Of course he did not. Too often, kids go away to school expecting something, and it does not deliver. Usually the first month of school, you're drinking 5-6 days a week (almost everyone does when they get there), and pretty soon you settle into the culture of partying 4 or 5 nights a week. This goes on for three and a half years, and then you find yourself saying, "Oh shit.....this is almost over...I need a job". At no point do you learn to express individuality, or think critically.