As the state of student loans continues to be in crisis, it’s important to weigh the cost of your education with what you’ll get out of it in the long run. A sheepskin that will garner you $30,000 a year in salary but that costs $40,000 in student loans isn’t a great bargain. But the same $40,000 in educational debt can be a comparable bargain if your degree enables you to earn $70,000 a year. Many college students borrow to get through college without an eye on the long game. But the reality is, you need to think about the return on investment (ROI) that you’re buying with those student loans. It’s personal, but for the lender it’s business – so you need to look at it as a business decision as well. Bloomberg Business Week calculated ROI of 1,248 schools by surveying graduates’ earnings compared to non-degreed workers compared to the cost of attending the schools. (That’s a simplification of their methodology. For an in-depth gander at their calculation process, click here.) With that in mind, here are the top 10 schools for educational ROI: #10 University of Notre Dame. This Indiana private school has an enviable graduation rate of 96% and a $1.12 million 30 year net ROI. This scores them an annualized ROI of 12.6 #9 University of Pennsylvania. This Pennsylvania Ivy League rated private school has a 95% graduation rate and a 30 year ROI of $1.18 million and an annualized ROI of 13.2 #8 Duke University. The private North Carolina research university also has a 95% graduation rate, a 30 year annualized $1.23 million ROI and an ROI score of 13.2 #7 Dartmouth College. This New Hampshire Ivy League school graduates 94% of its students and offers a $1.3 million 30 year annualized ROI scoring them a 13.8 ROI #6 Harvard University. No surprise that the swanky Massachusetts Ivy League school with a 98% graduation rate has a $1.28 million annualized 30 year ROI. This ranks them at an ROI of 14.5 #5 Princeton University. The New Jersey Ivy League college graduates 97% of its students and has a 30 year annualized ROI of $1.33 million giving them an ROI of 14.4 #4 Stanford University. California’s top private research university has a 95% graduation rate, a $1.39 million 30 year annualized ROI. Their ROI score is 14 #3 Massachusetts Institute of Technology (MIT). The private engineering powerhouse in Massachusetts has a 91% graduation rate and a 30 year annualized ROI of $1.49 million garnering them a 14.3 ROI score #2 California Institute of Technology (Caltech). California’s private engineering school graduates 89% of its students who average a 30 year annualized ROI of $1.7 million and an overall score of 13.9 #1 Harvey Mudd College. This liberal arts and engineering school in California is little known, graduates 91% of its students and sees them earn a 30 year annualized ROI of $1.7 million and a score of 13.1 With the exception of the last school – which I’ve never heard of – the top 10 aren’t a stunning surprise. When you look at the White House’s College Scorecard, you see they rate high there as well. It takes a Herculean effort to get into most of these schools, so graduates stick around to get their sheepskin. What’s more, the reputation of the school surely enhances job and earnings opportunities for alumni. However you want to look at it, these schools certainly give their graduates a lot of bang for their educational debt! To take a look at the full results of Bloomberg’s ROI evaluations to see how your college ranked, click here. The worst reviewed school on the list – Illinois’ Judson University – has a 30 year ROI of negative $298,000. Wow! According to their calculations, grads of this school would be better off having never matriculated. If you’re an alumni of Judson, this may come as a blow. Tomorrow, we’ll take a look at the bottom 10 schools for ROI and try to suss out how they landed so low on the rankings… Until then, consider this – without a good ROI from your college degree, your student loans may be too overwhelming for your personal finances to bear. Remember, student loans are hard to escape – you may be able to divest yourself of them in bankruptcy – but otherwise, they are yours for life! Whether you are just starting to borrow to finance your education, are preparing to graduate or are in your post-college phase, balancing work and student loan debt, try Tuition.io’s free student loan management tool to control and optimize your debt!
What’s Your Degree Worth? Top 10 Schools for Educational ROI
March 12, 2013
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