The ROI of your college tuition

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by collegelife on August 13, 2011


According to a recent article on the Wall Street Journal‘s “Smart Money”, most private schools with the highest tuition costs may not get their students a bigger paycheck.  The public schools fared much better by the return on investment and “payback” ratios.

For example number one on the list is the Georgia Institute of Technology ( Georgia Tech).  They had the highest Payback Ratio with a 221.  The class of 2009 will spend just under $80,000 for 4 years of tuition and fees.  A recent graduate will earn a median pay of $57,300.  A GA Tech student from the class of 1996 paid just under $28,000 for tuition and fees and has a median pay of $105,000.

The fifty schools listed on the poll, Sarah Lawrence College finished last.  These private school students from the class of ’09 will pay a whopping $148,570 for tuition and fees and earn a median income of $38,600.  Their class of ’96 paid $76, 626 with a median income of $72,100 in their mid career.  That’s a Payback ratio of only 60.

Since 1996 tuition costs have doubled, tripled or quadrupled depending on the school.  But according to the Wall Street  Smart Money article, the top schools with the best Payback ratios were all public.  The Ivy Leaguers were in the middle and the bottom tier was made up of all private schools.

According to the article, financial aid and scholarships are not factored in the costs and ratios.  An interesting quote from the article, ” the average Columbia grad can expect to earn $100,000 a year by her mid-30s, according to PayScale — 2 percent more than a graduate of a top-priced public university at the same stage of life.  So does that justify the extra 50 grand that he or she might pay for an Ivy League education, NYC-style?”

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