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2013 November 15

Is college worth the price?

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On the homeschool-to-college mailing list (hs2coll@yahoogroups.com) there has been a lot of discussion lately about whether private colleges are worth the $250,000 sticker price for four years.

The discussants generally divide into several camps:

  • There is no way that any college is ever worth that much.  Go to a cheaper state college.
  • No one pays sticker price—the actual cost is lower at top-ranked private schools than at state schools.
  • Why not do two years of community college, then the cheapest bachelor’s degree you can find?
  • What you are buying for that huge chunk of money is access to a network of people with money and power—it can be worth it if your career depends on access to such a network.
  • When I was a student, …

Of course, everyone is right and everyone is wrong, as is usual in such debates.  The important question is why the student is going to college—what is the point of it?  Only then can you assess whether the price is reasonable or outrageous, and whether it is worth going to college at all.

A lot of people see college as a job ticket—the median earnings of college graduates is much higher than the median earnings of high school students.  If that is the primary goal of a college education, then it is pretty easy to do a calculation to determine the return on investment of buying a college degree.  Lots of people have done that calculation (Google ROI college degree), but I’m not very interested in that view of college, nor with the mindset that sees a college degree as a purchase, rather than as road marker in one’s education.

Another common view of college is that it is a time to make life-long friends (perhaps marriage partners), and that the social opportunities of college are not to be wasted.  While I made some friends in college, and more in grad school, few of them have become lifelong friends—I may see someone from college once every 2 or 3 years, at most. Perhaps if I were a more social individual, that side of college life would have had more importance for me. For my son,  I think that the social aspect of college will be slightly more important than it was for me, but I believe he is mainly interested in finding congenial, talented groups of people with whom he can do things he enjoys (like acting, designing computer programs and hardware, discussing esoteric features of programming languages, learning advanced math and physics, and so forth). [I’d be pleased if he found a girlfriend also, though I didn’t manage that until grad school.] Finding concentrations of congenial, talented people outside colleges and universities is difficult—it’s not that they don’t exist, just that it is hard to find and join them.

Still another view of college is that it is all about book learning—getting a lot of stuff learned in a particular field or in a broad array of fields that mark one as being “educated”. This is a common view for the parents of teenagers in public schools, but a bit less common on the home school lists.  A lot of the home school parents realize that their kids can learn what they want to without needing the structure of a college—the kids have been doing it for years.  Sometimes having a course structure is useful for setting deadlines or determining the scope of a period of study, but other times having a project that needs certain skills and knowledge is sufficient motivation and guidance for the learning.

MOOCs have been a very good deal for home-schoolers, providing the structure of a course without the cost. Of course, the zero cost has a downside—a lot of kids just dabble with the MOOCs and don’t commit to really learning the material, the way they might if they were paying for the instruction.  So even if kids could do the book learning for much less money than going to college, the sunk cost of college tuition provides a powerful incentive to continue and complete the degree.  (Of course most of the sunk cost is coming from the parents, so the parents end up having to motivate the student.)

To determine what college is worth for my son, I’m mainly interested in his long-term well-being—not just the next four years, but the next sixty. I think that he might be happiest if he got a PhD and became an academic, though that career is looking a lot less attractive for the next 30 years than it did 40 years ago, when I was an undergrad—salaries have not kept pace with inflation, workloads have increased, and research grants have gotten much harder to secure.  He might be happy as a working computer engineer or programmer, though I think he’ll find that the workplace is full of only marginally competent people, unless he gets very lucky in where he works.  I think he’s more likely to find congenial workmates if he joins a startup with people he has worked well with for some time, than if he joins an existing corporate structure.  But if he works for a startup when would he have time for acting (or a life)? It would be easier for him to find a group of competent people to do a startup with at some colleges than others (Stanford, for example, has a culture of creating startups, some of which have even been spectacularly successful).  Making a successful startup without colleagues found in college seems much riskier to me.

Most of the careers that would hold his attention require at least a bachelor’s degree, so I’m beginning with the assumption that he’ll do at least four years of college.

The University of California campuses provide a pretty good education for about $32,000 a year (figure $130k–160k for 4 years when tuition inflation is included).  That looks like the cheapest path we’d consider.  The cheapest route (2 years of community college, then transferring to a state school) is not likely to work for him. He has taken some community college courses as a high-school student, and they were fine for him then, but he is unlikely to find many colleagues at his intellectual level in a community college.  If it were the only way he could afford to go to college, then he could make it work, but we’ve been saving 10% of household pre-tax earnings each year since he was born in a 529 college savings plan, so we have enough saved to give him more attractive options.

Based on “net price calculators” from top-notch private schools that my son is considering, we would be expected to pay $42k–61k a year (figure $180k–$250k for 4 years). Incidentally, those net price calculators vary a lot in their ease of use.  Several schools use a net price calculator that can use information stored with the student’s College Board login—those are the easiest to use once you’ve filled one of them out, since the information does not have to be looked up and re-entered for each college.  Unfortunately, many of the colleges my son is considering don’t use that method, so I’ve not done net-price calculations for all of them.  Some of the colleges also include some merit aid in their packages, which means that the net-price calculators are too inaccurate to get more than a very rough idea of price from anyway.

At some schools we’d be expected to pay the full sticker price, while at others the discount is about $10k. Note that some colleges expect us to pay over half our household’s pre-tax earnings each year—they really penalize you for being thrifty and saving for college.  There undoubtedly exist schools that would give him a full merit scholarship, but they are unlikely to have enough intellectual stimulation in the fields that interest him to justify the time, even if the tuition is covered.  None of the schools we looked at provided anywhere near that level of merit aid.

Is the extra $50k–$100k for four years of a private college worth it? 

Well, it depends, of course.

In some colleges, what that money buys is “country club” dorms and activity centers—which don’t interest him very much.  Given that he is not a natural socializer, the network of political connections offered by some colleges is also of little value to him.  What I believe he values is working on projects too big for one person (both in theater and in engineering) and easy access to research opportunities. Some colleges provide more of both project-based learning and undergraduate research opportunities than others, and it isn’t necessarily correlated with public/private or big/small.

The University of California campuses do not provide as much of either projects or undergraduate research as most of the private schools he is looking at.  Although the UCs  have a lot of research, the ones he would apply to also have a lot of grad students doing the research, and the openings for undergrads are not proportional to the huge numbers of students who might want them.  Just finding out about research opportunities, which often requires personal contact with the professor leading the research group, could be difficult. (I think that UCSC does much better at providing research opportunities to undergrads than the other UCs, probably because the grad students only make up 10% of the student body, but the faculty are expected to be just as productive in research as at the other UCs—so faculty have to include undergrads to have enough people working in the lab.)  The classes at UCB and UCLA (the 2 UC campuses we toured) are huge in computer science, with upper-division courses having 50–200 students in them.  It is very hard to make connections with the faculty or with other students in such huge courses.  Acting at UCLA also looked to be almost impossible for non-theater majors—even theater minors couldn’t get roles (according to the theater majors we talked to).  The acting minor at UCB looked much more reasonable, though.  So access to faculty, to projects, and to research may be better at several of the private schools we looked at—that could be worth the price differential.

I also think that some of the private schools are more likely to provide the emotional support that my son might need to get through 4 years of college.  I’m not thinking of formal services like counseling or health care, which may be just as good or better at the larger schools, but of a sense of community and students feeling like family, rather than a random collection of strangers struggling alongside one another.  Different campuses really had a different feel to them when we visited.  Some felt like family, some like business partnerships, some like academic competitions, some like sports bars, and some like ant heaps with 1000s of anonymous, nearly interchangeable individuals. I think I’d be willing to pay more for a college that felt like it would be a home for him, rather than an office or a study cubicle (and certainly more than I’d be willing to pay for him to go to a sports bar).

The bottom line is that we saved enough for him to go to a private college, and if he gets into one that is a good fit, we’ll pay what it takes for him to go.  I think that the extra value is there in a few schools to justify the increased price.  Of course, there are also many, many schools that don’t look like a good fit, and that would be worth less to him than UC, but he is not planning to apply to any of those, despite the pounds of paper they have sent him in postcards and brochures. He’ll also be applying to a few UC campuses, as “safety” schools, since almost all the private schools he is applying to have very low admissions probabilities.

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