Seven Reasons Not to Send Your Kids to College, by JAMES ALTUCHER:
Imagine a retirement where you could have an extra $1million to $3 million in the bank with basically no effort. Now imagine telling your kids that you aren’t going to send them to college. And, you go on, you want them to immediately start a business or get to work as soon as they finish high school.
These are difficult things to imagine because we’ve been so scammed by the “career industry” that tells us we need college degrees in order to succeed in life, regardless of how much money we spend for those degrees or what we actually do with our lives during the four to eight years it takes us to get those degrees.
But in my view, the entire college degree industry is a scam, a self-perpetuating Ponzi scheme that needs to stop right now.
Here Are Seven Reasons to Say “No College” to Your Kids:
- More than 60% of people entering college take more than four years to graduate. So whatever you think your kids are going to cost you to go to college, add 20% to 100%.
- The cost of the average college tuition has gone up nine-fold since 1976 versus seven-fold for health care and three-fold for inflation.
- The differential in lifetime income between a college graduate and a non-college graduate over a 45 year career is approximately $800,000 (read on).
- If I put that $200,000 that I would’ve spent per child to cover tuition costs, living expenses, books, etc. into bonds yielding just 3% (any muni bonds) and let it compound for 49 years (adding back in the 4 years of college), I get $851,000. So my kids can avoid college and still end up with the same amount in the worst case.
- If smart, motivated, ambitious kids (the type of kids who get the most out of college) avoided college I’m sure the differential would be a lot less than $800,000 and may even be negative (i.e. they would make more if they avoided college and started going into the business world earlier).
- The average debt burden of a college graduate is $23,000. Up from $13,000 10 years ago. Students with professional degrees can see their debt burden go higher than $200,000. Total student borrowing has topped $75,000,000,000. It’s too much for young adults just starting their careers.
- Alternatives to spending $200,000 per kid so they can waste four years of their lives:
- Give them $20,000 to start one to five businesses. Most businesses fail but that’s ok. The education from the process lasts a lifetime and the network you build when you start a business will lead to many future jobs and possibilities.
- Travel the world. That would be an education that pays many dividends and is much cheaper. Your kids can then go to college with a much more mature view of the world.
- Work. They won’t get the best jobs but they can make money, network, get a “hands-on” education, learn the value of money and go to college in their 20s when they can afford it — and make every dollar worth it. Plus your kids will have a more clear idea of what they want to do in the world.
- Volunteer. Let them see a side of life that is harder and where they can add value. An education like that is invaluable.
- Do nothing but read. Get the benefits of a college education without paying the $200,000. I’d be happy to support a child that wants to home school a college education.
Note: The writer, James Altucher, holds a BS in computer science from Cornell University and a master’s degree in the same subject from Carnegie Mellon University.