The average student loan debt is now $39,400, and yet Americans still like to believe that going to college is an investment in the future. It brings lifelong friendships, challenging coursework and hopefully a good job at the end. But has anyone ever thought to conduct a rigorous ROI analysis, considering the average tuition costs, student debt and earnings potential for graduates?
We found the numbers for our map from Payscale.com, which calculated a few different metrics for every major college or university in each state across the country. They took the average total cost of tuition (the red part of our visual), the average student debt (the puple part), the typical length of time to graduation (usually 4 years), and the graduation rate. They then determined the 20-year ROI for going to school by comparing two different populations: people who skip college and start a career right after high school, and people who go to college and wait to start a career. In other words, think about a high school graduate with 24 years of experience compared to a college graduate with only 20. What is the net difference, if any, in pay? That’s the blue part of our visual.
Here is a list of the best value schools in every state (with 20-year net return on investment):
Alabama: University of Alabama in Huntsville, $518,000
Alaska: University of Alaska Fairbanks, $527,000
Arizona: Embry-Riddle Aeronautical University-Prescott, $529,000
Arkansas: University of Arkansas, $374,000
California: Harvey Mudd College, $978,000
Colorado: Colorado School of Mines, $909,000
Connecticut: United States Coast Guard Academy, $714,000
Delaware: University of Delaware, $488,000
Florida: Embry-Riddle Aeronautical University-Daytona Beach, $549,000
Georgia: Georgia Institute of Technology-Main Campus, $856,000
Hawaii: Brigham Young University-Hawaii, $263,000
Idaho: Brigham Young University-Idaho, $468,000
Illinois: University of Illinois at Urbana-Champaign, $585,000
Indiana: Rose-Hulman Institute of Technology, $751,000
Iowa: Iowa State University, $435,000
Kansas: Ottawa University-Ottawa, $438,000
Kentucky: Thomas More College, $362,000
Louisiana: Louisiana State University and Agricultural & Mechanical College, $422,000
Maine: Maine Maritime Academy, $718,000
Maryland: United States Naval Academy, $1,004,000
Massachusetts: Massachusetts Institute of Technology, $1,015,000
Michigan: Kettering University, $766,000
Minnesota: University of Minnesota-Twin Cities, $449,000
Mississippi: Mississippi State University, $293,000
Missouri: Missouri University of Science and Technology, $753,000
Montana: Montana Tech of the University of Montana, $634,000
Nebraska: Nebraska Methodist College of Nursing & Allied Health, $363,000
Nevada: University of Nevada-Reno, $363,000
New Hampshire: Dartmouth College, $707,000
New Jersey: Stevens Institute of Technology, $832,000
New Mexico: New Mexico Institute of Mining and Technology, $692,000
New York: United States Merchant Marine Academy, $1,094,000
North Carolina: Duke University, $641,000
North Dakota: North Dakota State University-Main Campus, $413,000
Ohio: Case Western Reserve University, $568,000
Oklahoma: University of Oklahoma-Norman Campus, $424,000
Oregon: Oregon Institute of Technology, $572,000
Pennsylvania: University of Pennsylvania, $739,000
Rhode Island: Brown University, $616,000
South Carolina: Clemson University, $461,000
South Dakota: South Dakota School of Mines and Technology, $635,000
Tennessee: Vanderbilt University, $496,000
Texas: Rice University, $650,000
Utah: Brigham Young University-Provo, $595,000
Vermont: Middlebury College, $358,000
Virginia: Virginia Military Institute, $680,000
Washington: University of Washington-Bothell Campus, $609,000
Washington, D.C.: Georgetown University, $619,000
West Virginia: West Virginia University Institute of Technology, $493,000
Wisconsin: Milwaukee School of Engineering, $611,000
Wyoming: University of Wyoming, $360,000
— — —
There are several high-level trends in our visualization. First off, no matter where you live, it clearly pays to go to college. Every single state has a large blue bar in it. The worst ROI for getting a degree is in Hawaii, but even their graduates will have earned $263,000 more than their less-educated counterparts after 20 years of working. The average ROI for all 50 schools (plus Washington DC) is an eye-popping $595,000, and the average loan amount is just under $29,000. That means that, on average, going to a high-value school gives you roughly 20x return on your money. Try getting that in the stock market.
Our map also lays out a nice visual of value schools across the U.S. The best value can be found in the Northeast, which is represented by the large blue bars in several states. There are several schools with $700k+ returns. Things look relatively modest in the South, with no state topping $700k. California meanwhile anchors the West Coast with the best value in the region, where Harvey Mudd College generates just shy of $1M in ROI for graduates.
Taking a closer look at the visualization reveals another interesting trend. Some of the schools are very well known, like MIT in Massachusetts and many of the state schools across the Midwest. But if you’re honest, how many of the top ten have you previously heard of? Clearly there are several schools with the word “technology” in the name, indicating that getting a science, engineering or IT degree carries some serious ROI. Many of these schools might not be well known in pop culture, but we bet hiring managers compete for the attention of these graduates.
But what if you are nervous about taking out student loans to finance your college career? After all, a lot of people start college but don’t finish. That can lead to the worst of both worlds: student debt but no degree (or higher earning potential) to show for it. The graduation rates are relatively high for all these schools, topping 80 and even 90+%. But if you still want to hedge your bets, consider joining the armed services through the Naval Academy ($0 in debt at graduation, but an ROI of $1,004,000). And if joining the military doesn’t appeal to you, consider instead a low-cost, low-debt school on our list, like BUY-Idaho. Graduates typically only have $17,700 in average debt, which comes out to only about $200/month in repayments over 10 years. If that still seems like a lot, remember, you’re going to make $468,000 more over the next two decades!
Data: Table 1.1
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