If you’re reading this article I probably don’t need to spend time convincing you that something is wildly out of wack with college educations today. They cost more than ever, they leave students buried in tens of thousands in debt for years to come – and worse – they no longer carry the promise of career success that they once did.

The education purists might be offended by that observation, but in the real world where most of us live, the biggest reason by far for getting a college degree, or paying for one for our children, is creating improved income earning capabilities. We don’t have the luxury of viewing an advanced education as some sort of gilded virtue divorced from economic reality. The paycheck waiting at the end is the primary justification for the effort.

Is A College Degree Worth The Cost?

To emphasize this point, along comes William Bennett, former Secretary of Education under Ronald Reagan, who asserts that only 4% of colleges are worth the money. I’m not going to spend any time on that 4% claim, nor the factors that make it up, but I think the point is very well taken. College students and their families are spending an increasingly enormous amount of money on attending “the right school”. In too many cases, it’s a wasted effort.

You’re Still Better Off With A College Degree Than Without One

If you do some research on the subject, you’ll find that the difference in lifetime earnings between someone with a college degree and one with a high school diploma is anywhere from a few hundred thousand dollars to over a million. The exact amount is a moving target but one fact is absolutely clear: people with college degrees – in general – do tend to earn more money than non-graduates over a lifetime.

We’re not debating the value of a college degree, but rather challenging the notion of “pay any price to get that coveted degree” that seems so popular these days. Hard choices need to be made, especially when financial resources are limited, as they are for most students and their families.

A College Education Is No Longer The Deal It Once Was

True enough, statistically at least, you can expect to earn more money with a college degree than without one. But how much should you pay for that advantage?

That is the question that needs to be asked today. 20 or 30 years ago, a college education was unquestionably a good deal. You could earn the degree that was your ticket to higher future earnings, but the cost of that education could generally be recouped in the first year or two of employment. Today however, students are routinely entering degree programs that cost several times the expected first-year remuneration.

That changes the whole game.

For middle class and lower class families, the decision to send a child to college is no longer a “no-brainer”. Because of the high cost of obtaining the education, a graduate can enter the workforce so deep in debt as to be technically bankrupt. Even with a strong college degree, that is a decidedly disadvantaged way to enter adult life.

Part of the problem today however, is that students and their families are still laboring to work within the expectations of previous generations when a college degree made perfect financial sense. This is why so many graduates are either deep in debt, or unable to obtain employment related to their degree program.

The College Matters – But The Major Matters More

A generation or so ago it was possible to get a well-paying job – and build a successful career – as a result of having a degree in nearly any major. A degree in philosophy or history would be enough to get you a well-paying job in a corporate environment upon graduation. The major seemed to matter far less than the fact that you had a degree.

Today that situation has changed completely. While you may land a job pretty quickly after graduation if your degree is in nursing, accounting, or information technology, a degree in the soft sciences, such as sociology, philosophy or English literature, are mostly seen as advanced high school diplomas.

The major that you select is now critical. If that major cannot be reasonably expected to land you in a well-paying career field, you might be better off passing on college, and entering the workforce to gain practical experience instead.

More Isn’t Always Better When It Comes To College

As prospects for college graduates have dimmed in the last few years, the emphasis on getting into “the right school” has only grown. The thought is that the more prestigious the school is, the greater the career prospects will be upon graduation. This however is no longer true. Once again, degree trumps pedigree – your major is likely to have a far greater impact on your career success than the school you graduated from.

Part of the shift is that employers are now less concerned with credentials, and more interested in hands-on skills (“what can you do for us if we decide to hire you?”). For this reason, an accounting degree at a local state college will probably be more valuable to you than a liberal arts education at an Ivy League school.

Economic Relevance DOES Matter When It Comes To College

In elite circles, there’s often a view that a college education takes place in a vacuum. In this view, the education obtained is seen as more important than the economic outcome that it produces. But for most of us, the economic outcome is the entire reason for getting a college education in the first place.

Unless you’re independently wealthy, this is the only way you should see it. The cost of a college education is so high that there must be an economic return on the investment.

There are two ways that you can handle this: choose a major that is likely to have the most positive economic outcome, and keep the cost of your education as low as possible.

In the first case, it’s important that your major is likely to produce the highest paying and most stable career possible. The second involves finding less expensive ways to earn that degree:

• Attend an in-state college, rather than a private college or one located out-of-state
• If possible, commute to school from home rather than living away on campus
• Spend the first two years of your education at a community college
• Work your way through college
• Attend school part-time, while working full time for an employer that provides tuition reimbursement
• Work for scholarships, or apply for assistance from the college – some grant assistance to a limited number of students
• Set a strict limit on how much money you borrow for your education – it should be limited to an amount that will be very reasonable to payoff on the expected income that the education is reasonably likely to produce.

There’s no doubt that you’re better off with a college degree than without one. But the game has changed – the sky is no longer the limit. That will mean compromises – are you ready to make a few?