Use our free college ROI calculator to estimate the expected return on investment of what you’ll pay for your college education. This calculator is based on college ROI data.
There is plenty of data today to support the value of college. But the key factor in determining whether you will see a positive return or a negative return is simply… How much do you pay out of pocket? (This will be your net worth after scholarships, grants, and other gifts.)
To use our college ROI calculator, simply enter your annual out-of-pocket cost (this is what you pay — whether cash or loans), your gender, and the number of years you expect to spend in college. Be honest – it’s okay to choose more than 4 years if that applies to you. After that, the calculator will provide you with the estimated ROI.
What to know about the college ROI calculator
When you’re trying to figure out if college is worthwhile, the out-of-pocket cost will be the biggest factor. Yes, your future career path and earnings are important, but our calculator focuses on average data for graduates.
However, you should keep this in mind – since it is an average, it means that a significant number of graduates are more than average, but also a significant number are earning less. We take a conservative approach to ROI with our calculator. The latest and most comprehensive data shows this Over 25% of bachelor’s degrees have a negative ROI.
Cost of college
This should be the out-of-pocket cost of college. This is the amount you will write a check for (or take out a student loan for) after you have received all of your scholarships.
Our calculator will increase the annual cost by 5% per year for each year of university – since your first year is always the cheapest. Typical colleges will see a 3% to 8% increase in costs per year (they’ve been at their highest levels recently due to inflation).
sex
Gender still has a significant impact on lifetime earnings, which in turn influences whether college is worthwhile or not. The return on college investment for women is about 30% lower than the return on investment for men, due to the lower income that women typically receive.
College years
Finally, the number of years you spend in college has a huge impact on your ROI because it directly affects how much you will spend.
If you can transfer to a state college after 2 years of tuition at a free community college, you will have a much higher return on investment than someone who spends 5 years in college.
Factors that can affect return on investment
There are some factors that our college ROI calculator cannot capture and take into account.
Average data: First, the calculator uses averages. Not all graduates are average. Some will be below average (including those with negative ROI), and some will be above average (think doctors, etc.). It is impossible to accurately predict anyone’s future earnings trajectory. This calculator is simply designed to help you understand whether or not you are overpaying for a bachelor’s degree – compared to the average.
Loan forgiveness:
Second, for some borrowers who qualify for loan forgiveness programs such as Public Service Loan Forgiveness, borrowing may not be a negative factor for investment return. These borrowers can work 10 years in public service, and have their remaining loan balance forgiven. This can be a windfall for teachers, who may need to borrow to pay for college, and may not have high earnings after graduation, but can get student loan forgiveness.
