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"The average student loan debt in 2016 was $37,172" To be clear, the opportunity costs of unearned and non-debt payments generally would be in north of 150k ra

"The average student loan debt in 2016 was $37,172" To be clear, the opportunity costs of unearned and non-debt payments generally would be in north of 150k range. Assume 30k/year income 4x years is 120k, plus the 37k debt, plus non-debt spending. " An Associates will net you about $400M over your lifetime, a Bachelors about $1MM," And the same monetary investment in a fund earning 7% interest will be worth more than three times that over the same time frame. It is not a good financial investment, on average. Some degrees have positive ROI. Many - most - do not.

matwood 9y ago
> To be clear, the opportunity costs of unearned and non-debt payments generally would be in north of 150k range. Assume 30k/year income 4x years is 120k, plus the 37k debt, plus non-debt spending. Do people no longer work while in college?
- throwaway76543 9y ago
  They necessarily do not work as much as they might otherwise. Even if we lower the wage opportunity loss to a mere $15k/yr, a 4 year degree falls short by a factor of two -- or a cool million dollars over one's lifetime. And that's without factoring in the non-debt costs. Realistically, the gap is much greater.
dlp211 9y ago
Did you just claim a 20x return on investment wasn't good? A 7% investment adjust for inflation will return about 4x over the same time period (40 years). I have no clue what the hell you are talking about.
- throwaway76543 9y ago
  Saying "20x" return is meaningless without considering time. 1% growth will have a "20x return" if you're willing to wait 300 years. So no, a "20x return" is not necessarily good. What I've said is that the return from a degree program is less than half of a moderate investment return in the stock market. It's a very simple point I'm making here. You don't need to get confused with inflation - it applies similarly to both scenarios and drops out of the equation. Turning $150k into $3m over 45 years could be described as "average market performance." Turning $150k into $1m over 45 years using a degree could be accurately described as "a below average performing investment."
TheCoelacanth 9y ago
Good luck finding a bank that will let an 18 year old with no assets make a leveraged investment in stocks.

matwood 9y ago

> To be clear, the opportunity costs of unearned and non-debt payments generally would be in north of 150k range. Assume 30k/year income 4x years is 120k, plus the 37k debt, plus non-debt spending. Do people no longer work while in college?

throwaway76543 9y ago
They necessarily do not work as much as they might otherwise. Even if we lower the wage opportunity loss to a mere $15k/yr, a 4 year degree falls short by a factor of two -- or a cool million dollars over one's lifetime. And that's without factoring in the non-debt costs. Realistically, the gap is much greater.

dlp211 9y ago

Did you just claim a 20x return on investment wasn't good? A 7% investment adjust for inflation will return about 4x over the same time period (40 years). I have no clue what the hell you are talking about.

throwaway76543 9y ago
Saying "20x" return is meaningless without considering time. 1% growth will have a "20x return" if you're willing to wait 300 years. So no, a "20x return" is not necessarily good. What I've said is that the return from a degree program is less than half of a moderate investment return in the stock market. It's a very simple point I'm making here. You don't need to get confused with inflation - it applies similarly to both scenarios and drops out of the equation. Turning $150k into $3m over 45 years could be described as "average market performance." Turning $150k into $1m over 45 years using a degree could be accurately described as "a below average performing investment."

TheCoelacanth 9y ago

Good luck finding a bank that will let an 18 year old with no assets make a leveraged investment in stocks.