And this is where the math gets fun. "The general rule of thumb is that their starting salary should be equal to the total amount of debt they have accumulated by the time they graduate," Robe said. "If they don't keep their debt load below that level, they will likely have trouble financially." So, ignoring all other possible reasons for college--such as personal growth, expanding your mind, and dreaming of winning a Grammy--college-bound students can do the math to find out if it's worth the financial investment. And if you're really into numbers, you can even use the following formula (which my son, Zachary, created) to calculate how many years it will take until you catch up economically to where you'd be without going at all: N = Y x Sw + C Sc - Sw That's the Number of years to catch up (N) equals Years of college (Y) times Salary potential Without college (Sw) plus the Cost of College (C) over your Salary potential after College (Sc) minus your Salary potential Without college. Got that? That means if my son spends $250,00 on four years of college to trade up from his above-minimum-wage surf shack job at 20,000 for a 60,000 job in math or physics, it will take 8.25 years after college before it's worth it. But if his new job only pays 40,000, it will take 16.5 years. This formula comes with a number of caveats, including the assumption that the salaries would remain constant and that college has no additional benefits. I ran it by the Director of the Cornell Higher Education Research Institute, Ronald G. Ehrenberg, for his thoughts.
"This type of calculation makes sense but it is subject to lots of qualifications," he said. "Earnings profiles vary with age, and they are steeper for more highly educated people. Earnings depend upon where you go to college on average for some occupations but not for others." And besides, no one knows with certainty what occupation he or she will wind up in, because Ehrenberg himself changed majors twice--going from math to physics to economics--and I personally am on about career #12.