Research

4 in 5 Parents Question Value Proposition of College

• By Dian Schaffhauser
• 12/07/15

The reputation of college for being worth the price tag is hitting the skids. In a recent survey only one in five parents of prospective college students (21 percent) deemed the cost of a four-year college degree worth "the value it delivers." Among high school counselors, the count was only slightly higher — closer to two in five; 37 percent of those advisors said they felt "strongly" that the cost was worth the value.

Those opinions come out of a survey recently held by Kaplan Test Prep and Money magazine to understand how people view the worth of a college education. The separate surveys were done online in October 2015 and include responses from 539 parents of prospective college students between the ages of 15 and 18 and 235 high school advisors.

According to the researchers, the lack of enthusiasm among parents may simply reflect their fears about how to cover the costs of college. According to a 2015 survey by the College Board, the average annual price of college for an in-state public institution is $19,548, including tuition and room and board; the price is $43,921 at a private college. Six in 10 parents say that thinking about the expense and how to prepare for it is "more daunting" than thinking about their own retirements.

"We know from talking to parents and high school counselors that the takeaway isn't that they don't believe in the value of a college degree — they're really concerned about the high sticker price. This is understandable since for many, it's a hefty investment that brings immediate debt but not necessarily immediate return," said Michael Boothroyd, Kaplan's executive director of college admissions programs. He added that parents need to remember that college is a "long-term investment that realizes itself over time."

A 2014 study by the Federal Reserve Bank of New York found that individuals with a bachelor's degree earn about a million dollars more during their careers than those who graduated only from high school. Between 1970 and 2013 as a whole, that study found, those with a bachelor's degree earned about $64,500 per year; those with an associate's degree earned about $50,000 per year; those with a high school diploma earned $41,000 per year.

Along similar lines, data from the United States Bureau of Labor Statistics showed that unemployment in 2014 for college graduates with a bachelor's degree tended to be about 3.5 percent; those with a high school diploma saw a six percent unemployment rate.

Rather than being intimidated by the cost of college, suggested the researchers, parents need to educate themselves about funding options.

"There are many top-notch colleges that provide generous financial aid packages, help students graduate with little or no debt and launch them into successful and productive careers," said Greg Daugherty, Money education editor.