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On average, skipping college and investing tuition costs nets a higher return

erikrood.com

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Re: On average, skipping college and investing tuition costs nets a higher return

#501

I think a lot of people are looking at this as "maybe this article is offering advice" instead, the way I'm looking at it is this is giving us a rough quantification of what we all know intuitively: that college is so expensive it's reaching a natural ceiling. The way this manifests in reality isn't millions of people all doing a cost/benefit calculus like this and coming to the rational conclusion they can skip coll…

And college got expensive partly through policy choices. Offering easy loans tends to make people price insensitive, so tuitions go up and a lot of that money goes to things like increasingly fancy buildings and making textbook publishers' shareholders rich. Meanwhile often less is going to state schools that, with low in-state tuitions, were historically a way up for a lot of people. (An older friend went to Berkele…

And then there is the bit where rich foreigners want to send their children to top schools, which usually translates into sending them to the United States as well as the general population increase. With more people competing for the same (or in some cases even fewer) spots the prices could only go up.

So now we get to see other effects at work and some of those effects expose this rise in price as unrealistic.

Re: On average, skipping college and investing tuition costs nets a higher return

#503

Earlier quoted context omitted.

There's still opportunity costs to consider. For example, in the Netherlands tuition is about 2k a year (the rest is subsidised). Education is top-notch (pretty much all of our universities are top 5% worldwide), although we don't have any of the top 0.1% institutions that educate a relative handful of students. (e.g. Harvard with 2k students per year) But despite cheap tuition fees, the average person would spend 5…

> Education is top-notch (pretty much all of our universities are top 5% worldwide) How is that top 5% computed? Do you have a source?

I made that up, so feel free to take it with a huge grain of salt. But I've worked in higher education, wrote my thesis on it and follow it still with a lot of interest, so the ballpark figure is probably roughly accurate.

I'd like to send you sources but honestly ranking education objectively is tremendously difficult. There are lots of different rankings that measure things you may not, at all, consider to be indicative.

For example, most rankings are heavily weighed towards citations and proxies thereof. e.g. Chomsky is one of the most rated academics ever, so if he moves from MIT to your university, your rankings blow up. Despite the fact he doesn't teach any classes, and the number of typical students that actually benefit from his (previous) research being associated with your university is close to zero. Particularly the type of students we're talking about: those who do a 3 or 4 year bachelor, then go to work. Lots of universities have high rankings because a handful of academic experts in their field are associated to the institution and put out innovative research, which usually means very little to the undergrads's education or development. Look into the methodology, it's usually a bit of a joke. It's the reason universities can rank from 40 to 140 to 40 within a a span of 3 years, despite no student having noticed any difference in the quality of their education. In short, university rankings are more about research than about education, which is fine, but the problem is they're often used by would-be students when choosing where they can get the best education. (or rather, which institution looks best on their resume, I guess). And I'm primarily talking about students who get a degree and then go back to work, those pursuing academic/research careers is another story, but it's a minority the article doesn't really focus on.

But that's just rankings. Even if you had good rankings, just counting the number of universities worldwide is tricky and runs into different ideas of what constitutes a university.

But to give you a sense: if you look at the QS or THE rankings which are quite popular, all universities in the Netherlands rank in the top 300. The US alone has more than 3000 universities, worldwide there are over 25000.

So in short and all honesty: made up the figure, I do think it's roughly accurate, I don't think there's great sources/metrics which reliable rank educational quality worldwide, and the metrics I don't really put much faith in would at least rank the 13 universities we have within the top 5%.

Re: On average, skipping college and investing tuition costs nets a higher return

#504

I think a lot of people are looking at this as "maybe this article is offering advice" instead, the way I'm looking at it is this is giving us a rough quantification of what we all know intuitively: that college is so expensive it's reaching a natural ceiling. The way this manifests in reality isn't millions of people all doing a cost/benefit calculus like this and coming to the rational conclusion they can skip coll…

> reconsider mortgaging the house (figuratively) to No, this is real. One of my kid's friends is going for Mechanical Engineering at a school that will cost her $60K per year. And she is committed to go past and Bachelor's and obtain a Masters. I have begged and pleaded with her to reconsider. I have done all the research for her showing salary potential, payments and a comparison showing what would happen if the del…

The reality is pretty simple, though: a lot of people making decisions like this will look at their career options when they graduate and have to face the real world, struggle for a while, then realize that they're more than qualified to make twice the money as a junior programmer and make the switch then, recouping their costs easily unless they're really stubborn.

Half the people that I went to school with in physics, math, econ, bio, did exactly that. They're doing just fine now because TBH, those fields are vastly more intellectually challenging to learn at a research level than being a well qualified working programmer is (doing proper CS at a grad level is a different story, on par with those other fields, but you don't need to be a research-class CS PhD to be an above average programmer), and most of them already had to learn to program to get through their courses anyways, so it's an easy transition.

It's the people in completely non-technical majors that have the most trouble, because they don't know math, they don't understand proofs or algorithms, or even basic problem solving, let alone how to design systems, and worse, they've never really had to learn to effectively use software except in extremely limited ways.

Re: On average, skipping college and investing tuition costs nets a higher return

#505
post #490
post #475

Earlier quoted context omitted.

they are reflected in the data. as outliers.

Does it seem reasonable to you to ignore every $ of income which is over median? Perhaps capping the income instead and taking the average could be more informative.

Can you rephrase that? I don't get what you're trying to say.

Re: On average, skipping college and investing tuition costs nets a higher return

#508

I think a lot of people are looking at this as "maybe this article is offering advice" instead, the way I'm looking at it is this is giving us a rough quantification of what we all know intuitively: that college is so expensive it's reaching a natural ceiling. The way this manifests in reality isn't millions of people all doing a cost/benefit calculus like this and coming to the rational conclusion they can skip coll…

And college got expensive partly through policy choices. Offering easy loans tends to make people price insensitive, so tuitions go up and a lot of that money goes to things like increasingly fancy buildings and making textbook publishers' shareholders rich. Meanwhile often less is going to state schools that, with low in-state tuitions, were historically a way up for a lot of people. (An older friend went to Berkele…

So since state interference is the cause for unaffordable tuition costs, more state interference will fix the problem ?
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