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ERIC Number: EJ965808
Record Type: Journal
Publication Date: 2007
Pages: 9
Abstractor: As Provided
Reference Count: 15
ISBN: N/A
ISSN: ISSN-0884-9153
The Financial Value of a Higher Education
Kantrowitz, Mark
Journal of Student Financial Aid, v37 n1 p19-27 2007
Five years have passed since the U.S. Census Bureau published synthetic estimates of work-life earnings by educational attainment. This paper updates those figures with the most recent data from the U.S. Census Bureau's annual Current Population Surveys, and adds net present value analysis of the financial benefit of a college degree to the individual and to the federal government. The added value of a bachelor's degree over a high school diploma or GED has increased to $1.2 million in 2005 from $910,000 in 1997-1999. Compared with the average out-of-pocket costs of a college education, this represents a return on investment in excess of 27%. The added value also corresponds to an additional $133,000 in cumulative federal income tax revenue. Accordingly, it would be financially worthwhile for the federal government to replace loans with grants in the financial aid packages of low income students if this yielded at least a 32% increase in the number of low income students graduating with bachelor's degrees. (Contains 4 tables and 3 figures.)
National Association of Student Financial Aid Administrators. 1101 Connecticut Avenue NW Suite 1100, Washington, DC 20036. Tel: 202-785-0453; Fax: 202-785-1487; e-mail: membership@nasfaa.org; Web site: http://www.nasfaa.org
Publication Type: Journal Articles; Reports - Descriptive
Education Level: Higher Education
Audience: N/A
Language: English
Sponsor: N/A
Authoring Institution: N/A
Identifiers - Assessments and Surveys: General Educational Development Tests