It Costs Over $10 Million in Opportunity Cost to Go to College

[LevelUP]

I guess WE ALL LIVE IN NORTH KOREA since nobody will say anything about this.

Where is the MSM? Where is academia? Where are the mathematicians talking about this?

Note: Dramatic effect added.

There are two different ways to look at the opportunity cost of college:

1. Not going to college at all.
   
   

This could mean flipping burgers at McDonald's or some other $15 an hour low-wage job, which is around $30k a year.

For some, it could mean a respectable job that pays at least $50k a year, such as working in IT, sales, or the trades.

       2. Doing an accelerated degree online.


In this case, we are comparing apples to apples: both an on-campus student and the online degree student are making an average of $50,000 per year.

For the people that went to an on-campus college, I took:

1. The average college debt, which, according to the Education Data Initiative, is $35,000.
   
   
2. Added $5,000 in interest for a 6-year loan, bringing the total to $40,000.
   
   
3. Included an annual savings rate of $7k a year, which is the max IRA savings limit.
   

Results:

On-Campus Student

Considering someone spends 5 years in college, it would take them until age 29 to break even. By the time they hit 65 years old, they would have $2.1 million.

Accelerated Online Degree

For the person that got their college degree at 18 years old, they end up with $6.1 million at 65 years old.

Skipped College

For the non-college person making $15 an hour, they end up with $3.9 million by saving the same 14% of income, which would be $4.5k a year. So they end up $2 million ahead but make $1 million less in earnings over a lifetime. Therefore, they are still $1 million net ahead of the college grad even though they make $20,000 less per year.