Student loan debt is hitting record highs, but a new report is highlighting the economic benefits of a college degree.
We’re stretching your dollar with why college could be worth the cost!
Does a college education still pay off? According to new research from the Federal Reserve Bank of New York, the answer is yes.
The new data shows those four years of university study can lead to fuller pockets in the long run. The research found the average college grad earns $78,000 per year.
Compared with $45,000 earned by someone with only a high school education. That’s more than $30,000 a year! However, the study did find one downside of going to college.
High opportunity cost, or the income a student loses out on when they step away from the workforce to attend college.
Researchers say while someone with a college degree will eventually earn a higher salary, they still lose out on four years worth of wages.
The Federal Reserve Bank of New York found that adds up to an average of $120,000!
Despite all that, along with rising costs of tuition and student debt, the new research found that a college degree is still a good investment with an average rate of return of fourteen percent.
So, remember to think long term and see the bigger picture. Experts say the cost of college is up front and the benefits are spread out over many years, so the economic value of a college degree is often hard to see.
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