Higher Ed, Debt, and Earnings after 10 Years

2015-09-19 00:00:00 +0000

It seems you need to pick a college with a completion rate of no less than 54% (the mean completion rate in this sample) and an annual cost of attendance of at least roughly $40,000/year. Why? Doing this minimizes risk of default on your student loans, minimize your student debt load upon graduation, and maximizes your 10-year earnings potential.

It’s pretty interesting to note that there’s an inverse-U relationship between cost of attendance and student debt. Somehow the schools in the middle of the pack, cost-wise, carry a much higher debt burden, on average, than schools either much higher or much lower on the cost spectrum. The cheap schools make sense (it doesn’t cost a ton to attend), but the expensive ones? Is it because the expensive schools are able to provide more grants and scholarships relative to the medium-priced schools? Unfortunately, the data is silent on that subject, but one can only speculate.

So what is this exclusive list of schools to attend?

Data: 2011 Academic Year, College Scorecard, a service of the U.S. Department of Education.