It's no secret that forking over a bundle for a college education will pay off in the long run. Could there be a way to dispense with the "forking over a bundle" part? Maybe so. To determine what a college degree is worth, PayScale dipped into its database of 1.4 million pay reports from individuals who used its online pay-comparison tools and calculated a 30-year net return on investment for more than 500 schools. It represents the amount earned by graduates of each school beyond what a typical high school graduate would have earned, after deducting the cost of their education and taking into account the school's six-year graduation rate. We parsed the PayScale data to find schools with below-average costs and above-average return on investment.
The result: a group of schools where you can get a college degree for less than $100,000, a discount of 20 percent or more over the average for all the schools in the study. They also boast a 30-year net return on investment that ranges from about $600,000 to more than $1.1 million, an improvement of 56 percent to 187 percent over the average for the entire sample. All of them sport decent graduation rates, too—in most cases, well above the 58 percent average.
All but one of these schools are public institutions, with high ROIs that at least in part result from low in-state tuition. Some schools have an added advantage. Our biggest bargain, the Colorado School of Mines, graduates engineers and very little else, while Brigham Young gets a big boost from the super-low tuition offered to members of the Mormon Church.
Note: The slides that follow present each school's 30-Year Net Return on Investment, 30-Year Net Return for Graduates, and Annualized Net ROI. All are based on self-reported pay data gathered by PayScale through online pay comparison tools; for the 554 schools in the study, PayScale used pay reports from an average of approximately 1,000 alumni from each school to determine net return. The 30-year Net Return on Investment is in 2010 dollars and represents the average earnings of a graduate (above those of a high school graduate) after deducting the cost of the degree and adjusting for the school's graduation rate. The 30-year Net Return for Graduates is the same figure, assuming a 100 percent graduation rate. Annualized ROI is based on the ratio of the earnings gain from a college degree to the cost of the degree; it takes into account the school's graduation rate and includes wage inflation of 4.3 percent per year. Total cost includes tuition and fees, room and board, and books and supplies for the number of years it takes most students to graduate from each institution. It has not been adjusted for financial aid awards. The graduation rate is the percentage of students that entered in the fall of 2002 and graduated within six years. The benchmarks shown are averages for all 554 schools in the PayScale study. ROI data and total cost supplied by PayScale. Annual tuition and fees, average financial aid package, applicants admitted, and most popular majors supplied by the College Board. For the complete ranking and a more detailed description of the methodology, check out our interactive table..
Data: PayScale, Integrated Postsecondary Education Data System, College Board