Break Even In 3.1 Years At Alabama A & M University
College is expensive and every year spent getting your degree is a year of lost wages and additional expenses. In order to determine when you will make up for the expenses of college (your Return on Investment) we will look at the estimated cost for a degree and the average starting salary of graduates from Alabama A & M University.
|Average yearly cost||$23,000|
|Average years to graduate||4.9|
|Average starting salary||$36,000|
Catch A High School Graduate Within 25 Years Of Graduating
To determine the year when you catch up, we need to factor in the average earnings of a high school graduate. To simplify things we will assume that the high school graduate starts out earning their full average salary of $30,000 and lives at home for free, while you must pay for your living expenses during college. After college we will assume that you both have the same expenses.
The earnings from an average graduate at Alabama A & M University will surpass those of a high school graduate in 25 years.
For a more detailed and accurate look at early/mid career earnings see the chart below.
Over 30 Years, A Degree At Alabama A & M University Is Worth $1,138,000
Setting aside the time value of money, after 30 years, an undergraduate degree at Alabama A & M University is worth about $1,138,000 more than what it would cost you.
Your total earnings of $1,251,000 from your initial investment in tuition, fees and other expenses of about $113,000 gives you an aunualized return of
If instead of going to college, you put that initial investment into Treasury Bills for 30 years at 5% you would have about $488,386
Additional Questions to Ask
- Given that the numbers here are just estimates, can you get preecise earnings figures from the college for students studying your specific major?
- The return on investment numbers calculated here assume you will be one of the graduates of Alabama A & M University that gets a job. Can the school provide numbers that show the likelihood of full-time employment after graduation for your specific major?
- What other "intangibles" of a Alabama A & M University education should you factor in beyond the raw financial return on investment?
- The "break even" calculation on the top of the page does not include interest on student loans. How will your debt level affect your ROI?