College costs continue to rise faster than the rate of inflation and it has become increasingly challenging for students and their families to pursue important education planning goals. According to the College Board, between 2008 and 2019, in-state tuition and fees at public four-year institutions rose at an average, inflation-adjusted rate of 3.1% per year, more than double the rate of inflation, at 1.6% for the 12-months ending June 30, 2019. The average tuition and fees for in-state public colleges during the 2018-2019 academic year, carried a sticker price of $10,230, compared to $26,290 for public, out-of-state institutions, and $35,830 for private colleges and universities. Among the nation’s private institutions, more than 100 listed tuition and fees at $50,000 or more for the 2018-2019 academic year.
While not everyone pays full price, any way you cut it, a four-year education is expensive, leading more students and their parents to wonder—is the value of a diploma still there? According to multiple studies, the simple answer is yes. College graduates tend to enjoy a substantial wage premium in the labor market. According to the Federal Reserve Bank of New York, “in recent years, the average college graduate with a bachelor’s degree earned about $78,000, compared to $45,000 for the average worker with only a high school diploma.” This means a typical college graduate earns a premium of well over $30,000, or nearly 75%.