Analysts at Goldman Sachs are starting to question if a college education is worth the massive debt some students are racking up.
According to the report, students who attend the bottom 25% of all universities earn less on average than high school graduates.
Students who attend some mid-tier universities might also want to reconsider.
“The average return on going to college is falling,” Goldman researchers wrote.
In 2010, the typical college student had to work 8 years to break even on their bachelor’s degree investment, Goldman found. Most graduates would be around 30 years old by then.
Here’s how long Goldman Sachs says it takes to “break even” from college expenses:
— 2015 graduates won’t break even until age 31
— 2030 graduates won’t break even until age 33
— 2050 graduates won’t break even until age 37
The research does note that some degrees will pay back student loans at a faster rate.
“The choice of college and major are more important than ever to students given the changing return profile,” writes Goldman.
Attending schools like MIT and Harvard is still a huge resume booster and pay raise for life, but Goldman questions whether millions of students at lower-tier schools would be better off doing other kinds of training.
“Graduates studying lower-paying majors such as arts, education and psychology face the highest risk of a negative return,” says Goldman Sachs. “For them, college may not increasingly be worth it.”
The price for a year of study at a private college is now $43,921. Even in-state public universities students are now paying an average near $20,000 a year.
The investment bank says it believes MOOC (Massively Open Online Courses) and specified training, are likely to grow in importance among companies as the years progress and the costs of attending a four-year university continue to skyrocket.