Student Loan Choices: A Critical Challenge - Essay Sample

Introduction

College costs are currently a major issue for most students as well as graduates (loan repayments) in the US. It is easy for a student with an average of approximately $21,657 of college costs per academic year to consider taking up loans for support. However, making the correct and right choice for the loans becomes a problem too since most students lack effective financial advisory points to help them in their decision making. In other words, inefficient decisions originating from poor or lack of financial guidance, poor course or career, and college choice contribute majorly to the issue of the high costs associated with attending graduate schools. On that note, it is crucial for these students to not only make informed decisions when considering paying premiums to attend a higher education program, college or degree. The benefits accrued to this importance can be determined by evaluating the income levels of different graduates.

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In order to establish the value for attending a graduate school by focusing more on income earnings, one must consider certain aspects like the choice of the college or campus, major course, career choice, region or location and the overall cost of the whole system.

In relation to the cost of education, the value of attending a graduate school is very crucial. In most cases, students are more inclined to borrow student loans which they are liable to pay in interest after graduation. However, the lack of adequate federal support has led to increased student loan debts in the US ,hence lower lifestyle status for most graduates, even those with jobs. The student loan debt averages at $1 trillion with around 44% of the graduates unemployed or working in jobs which do not require their degree education.

Also, most students tend to ignore the technical and applied science courses which are more marketable and independent in the job market than the white color jobs like accounting, social work or art which are seen as less valuable and more dependent of government or private sector employment. The course or major subject choice often dictates the amount of income earned which reflects the value of attending the college. This factor is directly correlated with the value and income earned after graduate school. This means that a less marketable course or subject major confirms a less valuable college attendance and low-income levels, and vice versa.

The income earned(return on investment) in this case is the amount of salary that a graduate is capable of earning in their career job. Essentially, the income amount should enable the individual to not only pay their education loans but also provide them with an average lifestyle status. Different from past years, nowadays, college and university staff and management teams put more effort when conducting income data researches, which are useful to potential students during the college application and career choices. In the US, most institutions are not suited to provide graduates income data. On the contrary, the federal government is more suited and responsible for publicizing the data with the help of the IRS, which tracks the graduate's income earning levels.

Based on the earnings data from the federal government, a two-year long college course provides immense value to the graduate. This means that the chances of earning a high-income level are high. For example, in Texas, a student with a two-year long technical degree course earns an income median of around $50,000-$11,000 more than bachelor's graduates in their first-year of work. On the hand, in Colorado, applied science course graduates earning an average of $7,000 more than B.A's graduates. On that note, apart from a consideration of the college or university itself, the course is also vital for determining the value of a student's education value.

Different platforms like Lumina Foundation and PayScale implement various strategies when comparing income earnings for graduates over a long period of time. These techniques consider the factors above to make their comparisons, i.e., colleges or Universities', region or location of the school, type of school, course and subject major choices. For instance, in PayScale, the starting salary of a nursing career is $54,100 to $41,400 more compared to that of an entrepreneur. Also, in relation to ROI on colleges and popular majors, PayScale concludes that in-state engineering major in George Mason University have ROIN of approximately $1,937,000 while those from MIT get an ROI of $1,734,000 on average. These differences provide a statistical account of what amount of value is to be placed on attending graduate school, i.e. whether it is worth the time and money or not.

According to PayScale, the ranking of higher learning institutions and return on investment should be considered by potential students or graduates. The PayScale ranking facilitates a good decision-making process for students by providing a list of colleges and courses with high earning potential. This college ROI report ranking provides great value especially for students willing to apply for education loans which require payment after graduation. For instance, the PayScale College ROI Report lists the Massachusetts Institute of Technology with a 20-year net ROI of $1,182,000, a four-year education cost of $249,000 and 93% graduation rate as the topmost (financial aid included). By contrast, Steven's Institute of technology is in the 15th position with a 20-year net ROIN of $932,000, four-year education loan of $250,000 and a graduation rate of 83%.

Figure 1:2018 College ROI Report (Arizona State)

Figure 2: Best Universities and Colleges by Salary Potential

The data above is a college salary report ranking best colleges and universities based on their salary potential. It depends on the feedback and performance of the school alumni. It shows Stanford University as having the highest mid-career pay, $156,700, in the engineering school while Yale University ranked in the 11th position with $146,300. The rate of pay is a major factor that helps determine the value of attending a graduate school.

Figure 3: Key Stats for Associate Applied Science (AAS)

Figure 4: Associate Applied Science Degree Salary

From figure 3, the amount of income received by graduate students from AAS differs with the experience levels and location of the job itself. However, since these two attributes are based on the choice of the course and school itself, they regulate the value accrued to graduate school attendance as well. In figure four, various majors in the AAS category indicate different income earnings with IT Manager having the highest and Administrative Assistant the lowest.

Figure 5: Median wages of architects and engineers by gender

Besides, the type of potential ROI, school college, university, course or major, racial and gender aspects should be considered when determining the value for attending a graduate school. By looking at the stats the men are always more valued and paid more compared to females )PayScale, 2019).

Conclusion

In conclusion, concentrating on different factors is the best solution to increasing a student's value for attending colleges, e.g., differences in colleges, potential ROI and salary pay, location of the colleges, education expenses, course or school and the general factors like pay inequality based on gender and occupation. However, the most important thing to focus on is the different major which determine a student's career path and skill-set. Therefore, with a good and positive analysis of these aspects, the value for attending a graduate school will be increased.

References

PayScale. (2019, June). 2018 College ROI Report. Retrieved from https://www.payscale.com/college-roi

PayScale. (2019, June). 2018 College ROI Report. Retrieved from https://www.payscale.com/data/peak-earnings-data-visualization

Starnburn, S. (2013, August). The New York Times: Education Life, Following the Money. Retrieved from https://www.nytimes.com/2013/08/04/education/edlife/calculating-the-net-worth-of-a-college-degree.html