College ROI vs. College Debt: How Does Your State Rank?

College ROI vs. College Debt: How Does Your State Rank?

By Beth Dumbauld

Not all debt is bad debt, or so the saying goes, particularly when it comes to a college education. Yet, even still, when it comes to college, some debt is an even better investment than others.

Depending on which state you live in, your overall college debt load can vary. However, if you find yourself in the situation where the average debt load is high for your state -- you may still be getting a better “deal” if the schools in your state offer a better return on investment (ROI) for each education dollar spent there, at least when it comes to graduates who pay in-state tuition and fees. Return on investment is a long-term (30 years) measurement of income pay back on salary.

Finally, when you look at college, it’s not a given that you need to take on the average amount of student loan debt which, for a four-year bachelors degree at a public university, is expected to be $20,200, and for a four-year bachelor’s degree at private nonprofit university is expected to be $27,650.1 You can increase your in-state ROI by reducing your overall cost of college.

One way to do this is to earn college credits prior to starting college and then transfer those credits to your college upon enrollment, thereby reducing your overall in-state tuition obligations. Online colleges and universities offer a variety of online classes, including AP courses, which, if successfully transferred, allow you to reduce the number of basic college courses you’ll need to take during your first year of college. You may even be able to earn enough credits to take a semester or two off of a four-year state school enrollment. You could even enroll in StraighterLine’s $999 Freshman Year of College program, where for under a thousand bucks, you can take 10 online classes and earn enough credits to completely bypass financial aid during your first year of college. It’s basic math: the less time enrolled in college, the less you pay in tuition. The less tuition you pay, the less debt you most likely will owe – and the greater potential of your personal college ROI.

1 Project on Student Debt, Quick Facts about Student Debt, 1/2010, p1.

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