Why One Of The World’s Largest Investment Banks Thinks College Is A Bad Investment
You know college isn’t the only option for a kid these days because Mark Zuckerberg, but as a hedge against the possibility that your progeny isn’t sitting on a once-in-a-generation tech idea, you’ve probably at least considered getting that 529 up and running. Maybe don’t run to the bank just yet, though, because the investment bank you’d want your kid to work for if they studied something investment-y has just announced that college itself might not be such a great investment.
In a recent report, Goldman Sachs published some sobering numbers about higher education. Due to the ballooning rate of tuition, 2030 graduates won’t break even on their (your) investment until they’re 33, and 2050 grads won’t see financial freedom until they’re 37. That means you can reasonably expect your very own Boomerang Kid, while your kid can expect a long slog through a rough job market. The report caveats degrees from top-tier schools that focus on certain fields (business, healthcare, tech), but points out that kids graduating from the lowest tier schools will earn less than high school graduates.
The Goldman Sachs researchers point out that the very nature of higher education is changing, and things like Massive Open Online Courses like those offered by edX and Coursera may let your kid study like a Stanford computer scientist without ever leaving Sheboygan. Hell, it’s 15 years out from the Sachs’ report’s worst case scenario, and this guy already wants to pay your kid to not go to college. So, don’t worry too much — your kid will be fine. Unless they wanted to a liberal arts education. Then they’re screwed.