Evidence shows it’s beyond just a yes or no.

Elon Musk has expressed the opinion that a four-year college degree is not a necessity for success or even for certain jobs. So, the question is: Is going to university still worth it?

For generations, a degree was seen as the non-negotiable stepping stone to a well-paying job and a comfortable life. But let’s be honest, the world’s changed. Tuition fees have climbed, student debt has piled up, and we’re constantly hearing about successful people out there who skipped uni altogether. 

So, what’s the real story? Is a college degree still a smart investment?

Why People Are Sceptical about a College Degree?

If you’ve been sensing a shift in how people view higher education, you’re not wrong. The Pew Research Centre recently found that many Americans are questioning the whole cap-and-gown affair. Let’s get this: only a measly 22% reckon the cost of a four-year degree is worth it if it means taking out loans. Nearly half (47%) say it’s only worth it if you can avoid debt, and a significant 29% just plain think it’s not worth the cost, period. 

What’s more, the perceived necessity of a degree for landing a good job seems to be fading. About 40% of US adults now say a degree isn’t important for getting a well-paying job. And almost half (49%) believe it’s less important today than it was 20 years ago. Ouch. Even amongst graduates themselves, only about a third feel uni is worth the cost if loans are involved.

Interestingly, this scepticism isn’t unfounded when you look at some recent trends. Young adults (ages 25–34) without a bachelor’s degree have actually seen their earnings and overall wealth go up over the past decade, and fewer are living in poverty. This is particularly noticeable for young men without degrees, who, after decades of falling wages and labour force participation, have seen things stabilise and even improve since around 2014. Young women without degrees have also seen their earnings trend up in the last decade, continuing a more stable path than their male counterparts.

So, case closed? Wait a minute — not yet.

The Costs & Gains from Attending College

While public opinion might show otherwise, some economists are urging a bit of caution before we declare degrees dead in the water. A recent analysis dug into the numbers, calculating the “internal rate of return” for a typical college graduate — basically, how profitable the investment in a degree is over a lifetime. Their findings? A rather healthy 12.5% in 2024. To put that in perspective, the long-term return on the stock market is around 8%, and for bonds, it’s about 4%. So, purely as an investment, a degree for the median graduate still looks pretty good.

The “sticker price” of university — the published tuition fees — is terrifying, no doubt. But the average net price (what students actually pay after grants, aid, and tax benefits) for a four-year degree in the US totalled about $30,000 in 2024. Believe it or not, after adjusting for inflation, these direct “out-of-pocket” costs have actually fallen in recent years in the US market alone.
The real kicker, the part that makes the total cost balloon, is the opportunity cost. This is the wages you miss out on by studying instead of working. This figure is estimated at a whopping $150,000 over four years, making the direct costs sound small. So, the total cost of a degree (direct + opportunity costs) rings in at around $180,000.

The Power of the Degree Premium

So, if it costs an arm and a leg (mostly in lost earnings), how can it still be a good investment? The answer lies in the “college wage premium.” Despite improvements for non-graduates, those with degrees still, on average, earn significantly more. In recent years, a typical US college graduate earned about $80,000 annually, compared to $47,000 for someone with only a high school diploma. That’s a premium of over $32,000 every year, or about 68% — pretty close to an all-time high.

While it’s true that tight labour markets have benefited everyone recently, with median wages for high school graduates rising 5%, college graduate wages rose even more, by 7%. Over a life spanning four decades, that annual premium adds up to well over the initial investment, even considering those hefty opportunity costs. Also, college graduates (58%) are far more likely than non-graduates (26%) to say their education was extremely or very useful in equipping them with the skills and knowledge for a well-paying job.

Is a College Degree Worth It?

So, is it worth it? It’s not a simple yes or no. For the typical graduate who completes their degree, the economic argument still seems to hold up. The lifetime earnings boost generally outweighs the costs, making it a sound financial decision.

However, “typical” is the operative word. These are averages and medians. For a chunk of graduates (perhaps up to a quarter), the equation might not work out so favourably. Factors like choice of degree, the institution attended, how long it takes to graduate, and individual career paths all play a massive role. And, crucially, these benefits largely apply to those who finish their degree. Starting but not completing can mean incurring costs without reaping many rewards.

Conclusions

The landscape is undeniably changing. The improving prospects for those without degrees offer more viable alternatives than perhaps ever before. Public confidence in the traditional degree path has lessened, and the financial burden is a serious consideration for anyone.

Ultimately, deciding whether uni is “worth it” is a deeply personal calculation. You have to take your own ambitions, career goals, passion for a subject, and tolerance for debt into account when making the decision. The numbers suggest that for many, a degree remains a powerful tool for economic advancement.

So, for those about to graduate from high school, what’s your next plan?

---

Thanks for reading my personal story. If you would like to learn more about (mental) health, personal development and/or (online) education from me, please feel free to subscribe to my newsletter below. Also please feel free to browse my blog — Society & Growth — for more content at https://jasonhungofficialblog.com/.