Is College Still Worth the Price Tag? How Families are Considering ROI before College Decisions

For generations, a college degree was considered the golden ticket to a stable, prosperous career. Parents saved diligently, students borrowed without hesitation, and the underlying belief was simple: the cost will pay off in the end. I can still hear my father engraining into my head to get a college education as a young lady. Today, that belief is under scrutiny. Soaring tuition, stagnant wages for many graduates, and a rapidly changing job market are forcing families to ask a once-unthinkable question: Is a college degree worth the investment?

Carnevale et al. 6

The numbers tell both a complicated and compelling story. According to the College Board’s Trends in College Pricing 2023, the average published tuition and fees for a four-year public institution reached $10,940 for in-state students, while private institutions averaged $39,400 annually. This represents a 169% increase in real terms since 1990, far outpacing median household income growth (College Board, p12). Meanwhile, the Georgetown University Center on Education and the Workforce reports that the median annual earnings for workers with a bachelor’s degree hover around $69,000, compared to $44,000 for those with only a high school diploma (Carnevale, p6). The lifetime earnings premium remains, but it varies dramatically by major. For example, engineering and computer science graduates may see a lifetime ROI exceeding $1 million, while arts and humanities graduates often see returns below $200,000 after factoring in debt repayment. The Federal Reserve’s 2022 Survey of Household Economics notes that 42% of recent graduates feel their degree was “not worth the cost,” particularly those in lower-paying fields (Board of Governors, p14). These disparities highlight that the “average” ROI masks a deep divide based on field of study, school choice, and borrowing levels.

The gap between high- and low-return degrees has widened because the labor market is increasingly polarized. In-demand fields such as healthcare, technology, and skilled trades offer strong wage growth and job stability. In contrast, many liberal arts and social science fields, while still valuable in a broader sense, have seen wages stagnate in real terms. Simultaneously, college costs continue to climb, driven by reduced state funding, expanded campus amenities, and administrative growth. This creates a dangerous equation: higher upfront costs plus lower wage growth equals weaker returns.

This isn’t just an economic conversation; it’s a cultural one. For decades, attending college was considered the default path after high school. Now, alternative routes like apprenticeships, technical certifications, and even direct-to-work tech programs are gaining legitimacy. Gen Z is more willing to consider non-traditional paths, especially when the ROI of certain degrees appears dubious. A 2024 University of Pittsburgh honors thesis found that Gen Z students increasingly question the necessity of a traditional four-year degree, with many exploring certifications, trade programs, and online credentials as viable alternatives due to cost concerns and uncertain career returns (Beit-Arie, 2024).

Given the stakes, families are turning to more data-driven approaches in college planning. Parents are recalibrating weighing prestige against the financial strain they impose. Parents are starting to evaluate potential majors, projected earnings, and after debt load before committing to a school with their family. For example, using tools like the U.S. Department of Education’s College Scorecard, families can compare up to 10 colleges at once, reviewing average earnings of graduates from specific programs against the total cost of attendance, their costs, and graduation rates. Transparency between parents and children on the overall cost of education can be difficult, but this is a great place to start the conversation comfortably. The goal is to ensure that debt remains a manageable percentage of expected first-year work-force earnings, generally no more than 8–10%.

Professional guidance from a financial advisor becomes invaluable when evaluating all the possible decisions. Advisors can simulate not just the cost of attendance but also the likely post-graduation financial trajectory for a student, incorporating:

• Tuition inflation forecasts
• Projected loan repayment schedules
• Expected earnings by degree field and geographic region
• The impact of scholarships, grants, and work-study

Advisors can also model “what-if” scenarios: What if your child switches majors to a lower-paying field? What if they attend graduate school? What are the differences between in-state and out-of-state scenarios? What if they take five years instead of four to graduate? These simulations can help families stay informed and make emotionally grounded decisions when it comes to the ones we love most.

A great advisor will also take the time to help balance the emotional and financial aspects of the decision. Parents may have dreams of their child attending a particular prestigious institution, but an advisor can show the long-term trade-offs. In many cases a slightly less expensive school frees up resources for a down payment on a home, early retirement contributions, or funding another sibling’s education. In essence, the modern college planning process is no longer just about “Can we afford it?” but “Will it pay off?” and “How are we going to do it?” The answer depends on clear-eyed analysis, honest conversations with your family, and professional guidance.

Sources:

Barari, S., et al. College Ranking Systems. NORC at the University of Chicago, 2024. https://www.norc.org/content/dam/norc-org/pdf2024/college-rankings-review.pdf

Beit-Arie, Y. Perceptions of the Value of Higher Education among Undergraduate Students. University of Pittsburgh, 2024. http://d-scholarship.pitt.edu/46097/.

Board of Governors of the Federal Reserve System. Economic Well-Being of U.S. Households in 2022 - May 2023. Federal Reserve, 2023, https://www.federalreserve.gov/publications/2023-economic-well-being-of-us-households-in-2022-executive-summary.htm.

Carnevale, Anthony P., Ban Cheah, and Emma Wenzinger. The College Payoff: More Education Doesn’t Always Mean More Earnings. Georgetown University Center on Education and the Workforce, 2021, The College Payoff: Education, Occupations, Lifetime Earnings - CEW Georgetown.

College Board. Trends in College Pricing 2023. The College Board, 2023, https://research.collegeboard.org/trends/college-pricing.

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