Traditional advice around paying for college focuses on early savings, 529 plans, and applying for scholarships. While these methods are still valid, the landscape of higher education financing has shifted dramatically in recent years.
It’s time for a new strategy.
- The cost of attending a four-year college can now total nearly $400,000, comparable to the median home price in the United States.
- More students are questioning the value of college, with only 39% of teenagers considering it “very important,” according to a 2023 Gallup survey.
This evolving situation means parents, students, and financial planners need to reconsider how they approach the challenge of paying for college.
Rankings Versus Return on Investment
College rankings, like those from U.S. News & World Report, are still highly watched, but financial advisers warn that prestige alone is not the best metric for choosing a college.
In the face of skyrocketing costs, it’s important to evaluate a college’s return on investment (ROI).
- Research shows that attending a higher-ranked school doesn’t necessarily correlate with better career outcomes. For example, a study from Stanford University’s Graduate School of Education found that student engagement in college has a bigger impact on success than school rank.
- Financial planners recommend prioritizing rankings that measure value and ROI over traditional prestige.
- Tools like Bloomberg Wealth’s ROI calculator can help families assess whether elite private schools are worth the cost, with many elite institutions underperforming in terms of average student return.
Choosing the right college based on value, rather than reputation, is key to avoiding overwhelming student debt.
Practical Planning and Next Steps
In today’s competitive educational marketplace, families need to approach college selection and financial aid with a practical mindset. Emotional connections, such as those formed during campus tours, can lead to poor financial decisions if not backed by thorough research.
- Parents and students should set a clear budget and expectations before engaging with any schools, ensuring the emotional pull of campus tours doesn’t lead to unrealistic choices.
- Financial advisers stress that negotiating aid is more important than ever. Applying to schools known for generous financial aid packages—even ones you may not plan to attend—can give you leverage in negotiating with your preferred institution.
- Good planning and open discussions about financial aid can help navigate the tough environment and maximize the benefits of a college education.
While college remains a worthwhile investment, today’s financial realities demand a well-thought-out plan to manage costs effectively.
Increasingly, online degree programs that optimize for engagement, connection, and career preparation are providing a better ROI than more traditional university programs.
This website is designed to find these new, more cost-effective programs. Our research team looks at individual program attributes, costs, and then we come up with rankings — all in an effort to help with your research while looking for an affordable degree program.