It’s Still Hard To Beat ‘Going To College’ As An Investment

New research shows that the money spent on college degree is a great investment by any standard.

It is according to an analysis of economists at the Federal Reserve Bank of New York, who reduced the number of college education on the number and benefits. Researchers found that for the middle graduate, a college degree paved the way for better paid jobs, which is equivalent to 12.5% ​​annual returns, since 1957, above 10.1% annual returns from the S&P500 stock index since 1957.

Analysis of Jason Abel, head of microeconomics at the bank’s research and statistics Group, and an economic policy advisor Richard Deitez kept the cost of tuition, specific levels of financial aid, and can earn all wages “opportunity costs” by working directly from a high school instead of going to school.

Although mathematics works favorably for most students, the situation is different. Investment did not pay for every school and every chief. Students who do not get financial assistance, people who used to participate in more expensive schools, who spent more than four years to earn a bachelor’s degree, and those who followed Major, led the low-paying career, saw low returns on their investment, researchers said in a separate blog post.

For example, large engineering companies earned an average withdrawal of 18%, while large education companies saw 6% returns (although the researchers said, many teachers’ salary is to work nine months in a year). Overall, 25% of students got an average returns of 2.6% per year for the money spent in college, which led to a suspicious investment, at least from the financial perspective.

However, researchers found that the college still serves as an entrance to high-paying professional businesses, making it a meaningful investment in a 40-year work career.

“The typical college graduation earns a return that easily crosses the benchmark for a sound investment,” he wrote.