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This is too simple to be useful. Not only will the wildly successful outliers skew the data, but it doesn't take into account the risk of paying a huge amount
by drblast 12y ago
This is too simple to be useful. Not only will the wildly successful outliers skew the data, but it doesn't take into account the risk of paying a huge amount now for the hope of earning more later.
In no other area would someone be taken seriously if they asked you for a few hundred thousand dollars now for the promise of paying double or triple that money back (on average!) by the time you die. That's a horrible rate of return, and all the risk is up front.
My mother paid her way through college working as a waitress part-time. You can't do that now without also accumulating a massive amount of debt. College for my mother was an easy decision in the 1970's, but put her thirty-five years into the future and it's not, and for many people like her isn't even an option.
That's the problem.
- thaumasiotes 12y ago> My mother paid her way through college working as a waitress part-time. You can't do that now without also accumulating a massive amount of debt. Yes you can. I had a friend who attended UCSC for three years (2004-07) on financial aid and wound up flunking out. According to him (I admit I haven't seen documents), the total debt he accumulated for those three years was in the low thousands of dollars. I'm pretty sure working part-time as a waitress for three years would cover it. I'm also pretty sure that, in the hypothetical case where your financial aid requires you to do well in school, flunking out doesn't meet that standard.
- akgerber 12y agoUCSC tuition & fees have more than doubled since 2004: http://www.collegecalc.org/colleges/california/university-of-california-santa-cruz/#.U4URxlhdXPY http://www.collegecalc.org/colleges/california/university-of... (And they had already increased by 41% in 2004.)
- thaumasiotes 12y agoI've noticed that myself, but doubling a debt under $5,000 leaves you with a debt under $10,000; not really a big problem to pay off.
- sokoloff 12y ago> it doesn't take into account the risk of paying a huge amount now for the hope of earning more later. The article says, "After adjusting for inflation and the time value of money, the net cost of college is negative $500,000, roughly double what it was three decades ago." which states that they used a discount rate higher than simple inflation, but doesn't say what that discount rate is.