An Issue of Money for Education

Lailah G. Akita states that “You start to live when you commit your life to cause higher than yourself. You must learn to depend on divine power for the fulfillment of a higher calling.” People have the desire in every perspective of their life, physical, spiritual and material. Modern teenagers not only demand material life but also the promotion of their spiritual life. In order to reach a higher spiritual realm, more and more seniors in high school choose to extend their academic life: to go to college to learn more and enhance their knowledge for the future.

The utopian purpose of the higher education is gaining invisible power, knowledge and seeking the truth. However, parents and students found that the higher they want to reach, the more they need to spend. Not just time, but also, the money. College cost is a big issue to most U.S. families. It narrows the entrance to the college, but it also honors the wisdom. Have you heard about someone’s success without going to college, someone who dropped out of college via financing failure, or suffered from unemployment after graduation? Many people question, “Is it worth going to college?” It really depends. It depends on personal experience, talent, family background, the way of defining success, and opportunities. But, for the most part, college education is worthwhile.

As we all know, colleges that provide undergraduate programs are categorized into four major groups: pubic two-year in-district, public four-year in-state, public four-year out-of-state and private nonprofit four-year. Public two-year in-district colleges are the cheapest among all of the colleges while private four-year schools are the most expensive. Based on the data from The College Board, “In 2016-17, average published tuition and fee price for in-state students enrolled full time at public four-year college and universities is $9,650 in 2016-17, $230(2.4% before adjusting for inflation) higher than it was in 2015-16.” (“Trends in College Pricing 2016” 9). $9,650 is just for tuition. The related fees like housing, meals, books and parking fee are not included. The total amount of college cost is far more than tuition itself. For example, a local Nebraska Resident has to pay about $21,310.00 for one school year, a cost that includes the tuition of $5,184.00 (“College Cost Calculator” 1). In other words, the tuition only represents one-fifth of the total college expenses. In addition, people are impressed by the other fact that the tuition is generally increasing year by year (“Trends in College Pricing 2016” 14). Along with 3.5% per year average rate increasing tuition trend in public college, U.S. median family income only rose 0.4% per year on average. Increasing tuition is keeping median and low-income families out of college. Unaffordable higher education pushes those families into an impasse that they can either give up or finance higher education.

What is affecting the rise in college tuition? First of all, the type of the school previously explained. Second, the enrollment. According to The College Board: “In 2015, 82% of high school graduates from the highest income quintile (above $100,010) enrolled immediately in college, compared with 62% of those from the middle income quintile ($37,000 to $60,300) and 58% of those from the lowest income quintile (below $20,582)” (Ma 3). Although the enrollment rate is increasing these years, the gap between rich and poor is pulling students away from colleges.

The third big factor is the increase of faculty salaries, especially the average salaries of full-time private institution faculty. They increased from $67,684 to $88,228 within 30 years (“Trends in College Pricing 2016” 33). The salaries of faculty is only a small portion of college expenses, and it is a required expense because it shows the respect of knowledge. People have nothing to do with this fixed cost.

After knowing that college cost is increasing, we need to figure out whether the cost is affordable. Many families have saved college money from the birth of their children. Besides family funding and personal income, there are grants, scholarship and work program (“Trends in Student Aid 2016” 7) that can help perspective students fulfill their dreams. Also, there are many students who choose to borrow through loans.

Grants are “free money” which usually given by federal and state government to people who are qualified for certain conditions. Grants can be found and easily applied on the internet. Some grants, like need-based federal, do not require essays as scholarship. According to the data from “Trends in Student Aid 2016,”

Total federal grants to undergraduate students increased from $20.6 billion (in 2015 dollars) in 2005-06 to $41.7 billion in 2015-16, after peaking at $51.9 billion in 2010-11. Total federal loans to undergraduates increased by 25% between 2005-06 and 2015-16, growing by 62% over the first five years, but declining by 23% between 2010-11 and 2015-16. (“Trends in Student Aid 2016” 3)

It’s obvious that federal grants are increasing in order to keep more and more students in college and debt-free. The federal government knows the importance of education, so puts money into grants. This is a good calling for current college students. For people who are in debt, they can pay off their borrowing by following federal government’s guidelines. It depends on personal decisions, but paying off college fully is not impossible anymore.

There are people who work and study at the same time through federal programs. The work program is called Federal Work-Study(FWS). This program helps students to find a part-time job and receive wages that are not less than the minimum wage. Students have to be employed by

The institution itself; a federal, state, or local public agency; a private nonprofit organization; or a private for-profit organization. Institutions must use at least 7 percent of their Work- Study allocation to support students working in community service jobs, including: reading tutors for preschool age or elementary school children; mathematics tutors for students enrolled in elementary school through ninth grade; literacy tutors in a family literacy project performing family literacy activities; or emergency preparedness and response. (“Federal” 1).

The federal work study program benefits both government and students. The federal government uses college students’ knowledge to develop economy, discover new technology, build infrastructures, and students can be employed by formal jobs in order to pay their college. That's a win-win.

Most families will contribute a large portion of tuition for college. Middle-Upper class families tend to send their kids to private institutions. They usually have already prepared college money for their kids. They can afford approximately 39% of their kids’ tuition while parents of public college students’ parents usually can afford only 16% (“Trends in College Pricing 2016” 22-23). Parents from low-income families are concerned about the fairness in education resources. They also want to send their kids to an affordable institution that can change their kids’ life and eventually edge them into upper society. It is a new reason it is hard to choose a college for parents and students who can afford a nice public university but not a private college.

Family support, government grants, scholarship, there are so many ways students can pay for their college. Will their pay-off cover their investment?

Higher education not only benefits individuals but also the whole society. Recent data shows that the education level of individuals changed from ruling by people who did not finish high school or even did not attend any school to having more and more graduated Bachelors. (Ma 14). These people are changing the world, they are helping this world with high-technology. They are turning U.S. economy from labor-based economy into knowledge-based economy.

Most of the graduated adults believe that they can make more money if they can finish a four-year college. Is it true? “In 2015, median earnings of bachelor’s degree recipients with no advanced degree working full time were $24,600 (67%) higher than those of high school graduates. Bachelor’s degree recipients paid an estimated $6,900 (91%) more in taxes and took home $17,700 (61%) more in after-tax income than high school graduates” (Ma 17). From big data, it is clear and certain that people will earn more if they obtain a higher diploma. If someone wants to attend University of Nebraska-Lincoln for four years, he/she is going to pay $85,240 total. Based on the average after-tax income, he/she can earn his/her tuition back in at least three years. On the contrast, people who do not have a High School Diploma cannot even make as half as much bachelors’ earning. But this problem is far more complicated. College students can work part-time jobs but they will lose four years chance to make money in labor force. “The median four-year college graduate who enrolls at age 18 and graduates in four years can expect to earn enough relative to the median high school graduate by age 34 to compensate for being out of the labor force for four years and for paying the full tuition and fees and books and supplies without any grant aid.” (Ma 18). Attending college actually slows down students’ capital accumulation process. They spend more time and money on education for at least 2 years without making huge profit.

Usually, people who choose to attend undergraduate program will do full-time job after their 22-year-old birthday. They miss four years and lose money for good invest opportunities. Even though they make more money than those who did not attend college, they need a long time to catch up with other’s economic level. It takes more time to make up for lost earning as the years spending in school increase too (Ma 19). It influences some high school seniors, especially who want fast money. Also, some students choose to take a gap year or even two years to work on funding their college.

There is always something beyond “payoff.” The more educated the people, the more opportunities they have. Because educated people earned the degrees and they can prove that they learned the skills that the real world requires, they have higher employment rate than “Less than a High School Diploma,” which is 82.6% verses 55.5% in 2015(Ma 28). That means uneducated people have higher risk of losing their jobs. So here comes a benefit of taking college education, the stable employment status. People who participated in college have more chance to achieve their dream jobs, because Human Resource Department prefers to employ someone with degree.

Bachelor degree holders gains benefit not only from work opportunities but also from work conditions. People need social care, pension plan, and awards. For instance, the most concerned issue is the retirement plans. Although college-educated people need 16 more years to earn the same amount of money as non-college-educated people do, they still can catch up with retirement plans. “College-educated workers are more likely than others to be offered retirement plans by their employers. Among those to whom these plans are available, participation rates are higher for individuals with higher education levels.” Also, Bachelor Degree holders and Advanced Degree holders have more retirement plan coverage among full-time year-round workers age 25 and older (Ma 31). People who miss the chance to go to college also miss the chance to benefit from retirement plan, to secure the future.

Furthermore, higher education attainment results in more health insurance coverage too. In 2015, people who earned bachelor’s degrees and advanced degrees had the highest employer-provided health insurance coverage which is 66% and 70% while people only with or without high school diploma only have 38% and 54% covered (Ma 32). Health insurance is very vital. Only 5% of those with a bachelor’s degree or higher were nor covered by insurance plan in 2015 (Ma 32). It secures the people’s health to sustain their work, the affordable insurance is pretty essential. Additionally, insurance plan is affected by the employee’s work positions, which means people with decent jobs will have possible discount for paying insurance plan. Also, people who lack of higher education tend to relate themselves with smoking, drug or drinking issues (Ma 36). People with bachelor’s degree have only about 7% to relate with smoking problem which will decrease their risk of disease and illness. Attending college is not just about expecting visual profitable outcome, it impacts a person’s lifestyle. No one can buy a healthy body.

Apparently, the poverty rate falls when the level of education increases. From the data of 2015, people with only or without high school diplomas have five times greater rate of poverty than college-educated people (Ma 34). Absolutely, no one wants to be poor, to live the average lifestyle. It shows that people who only attended high school have more possibilities live in respectively poor life associated with drug, drinking and debt conditions. College education cannot guarantee the decent future and income, but it largely reduces the chance to go into poverty.

Besides that, there are more and more reasons to go to college. First and the most important one is having fun. College students participate in many activities to enhance their lives. It gives them the ability to chase their dream and work positively. It really helps people run with inspirations. Second, college will prepare people’s skills to develop their future, such as communication, presentation, team building and critical thinking. “Develop a critical mindset enable you to distinguish poor information from rich information so that information becomes your real knowledge” (Netten 1). Last but not least, there are more foreign opportunities and networking opportunities for college students. No one can develop their communication skills all by themselves. College students have to interact with people in order to know how to cooperate with their fellow students and colleagues. Building reputation from young age is essential too.

In conclusion, although the cost of college is critically high, the payoff of this cost is uncountable. At the most part, the college cost is worthy. The annual college payoff is about $20,000 (Taylor 6). Besides finance part, college experience will prepare a person become a better “human,” to survive better. College education is a promising investment.