25% of Students Say College Loans Have Impacted Their Career Choices | Hacker News Reader

25% of Students Say College Loans Have Impacted Their Career Choices

bostinnovation.com

10 pointschermor13 comments

What's the average tuition fee in a typical US college/university year?

The UK was about £3300, now under roughly £7000.

Like 50,000 USD. About £31300.

"Private nonprofit four-year colleges charge, on average, $27,293 per year in tuition and fees" [1]

And that's just the private schools. The public schools are considerably cheaper: ~8k USD for in-state students and ~12k for external students. 50k USD is the full prize for the top private schools like Stanford or the Ivy League. Imagine how expensive some schools would have to be for the average to come out at 50k USD.

[1]: http://www.collegeboard.com/student/pay/add-it-up/4494.html

Would be interesting to see a study focused on student debt and decision making around founding a startup or diving into entrepreneurship. On the one hand, those who graduate without a lot of loans would be financially enabled to dive into e'ship. On the other hand, loans might actually influence and be a driving factor for recent graduates who couldn't land jobs to create their own businesses.

but that is micro-business formation where there debt load is not a penalty due to the low costs of setting up a micro-business, vastly different from a start-up where debt load is a penalty factor

Graduating with enormous debt forces a lot of kids into jobs they don't want, assuming they can get hired at all.

I honestly thought about this, back then when stock market had 'predictable returns.' Imagine $100K ($25k X4) in a retirement account for 40 years.

You might be dead before you get to spend it.

It has a lot to do with the peace of mind as well: "OK, I have to work till 60, but then I'm going to be pretty comfortable"

Inflation obviously takes a bite but it takes the same bite even if you put $5k a year when you're 40.

At 6% APR after 40 years it would be over $1 MM.

Discount that $1M with 40 years of inflation to give some idea of what the purchasing power might be and it doesn't look quite so impressive.

Let's use historical data instead of back of the envelope guesswork.

Over the last 40 years (1970-2010) the average S&P 500 return has been 11.61%, while inflation has been 4.4%. Past performance not necessarily but usually predicting future performance, but, with those rates...

Over the next 40 years $100k would grow to $8.1 MM in future bucks, or $1.45 MM in 2011 dollars.

http://www.moneychimp.com/features/market_cagr.htm for returns, http://www.moneychimp.com/articles/econ/inflation_calculator... for inflation, and http://apps.finra.org/Calcs/1/Savings for savings calculations.

Somehow I don't expect the next 40 years to look a lot like the last 40 years.

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