Choosing a College

During the past few weeks, many students have received college acceptances and financial aid offers, and must now decide which college to attend during the next few weeks. My book includes a large amount of information to help students and families compare and pick colleges, and here are a few important things to consider:

a) Expensive colleges don't lead to better payoffs than less expensive colleges. Several studies show that students' success tends to be based on their background and academic talent, rather than the college they attend. (An exception: Studies show that prestigious colleges can be helpful for low-income students. But my opinion is that these schools are only helpful if they are also affordable for the students. I'm not sure that attending these schools is worth borrowing a tremendous amount of student loans)

b) The college payoff often depends on a student's major. Therefore, students should try to attend colleges that offer strong instruction in their preferred majors.

c) Students should probably try to keep their debt as low as possible. This is especially true since colleges often require them to borrow much more money each year. For example, a student may be asked to borrow $3,500 during the freshman year, but then $4,500 during the sophomore year, and $5,500 during the junior year.

d) Parents often feel pressure to spend a lot on college, but they should consider using this money for their other expenses. As mentioned above, higher costs often don't lead to better payoffs. So parents can try to keep their college costs low and then use their savings for other expenses like: their other children to go to college, grad school costs, after-college costs for their child, retirement, investments in stocks and bonds, etc.

e) Students who want to attend an expensive college may be able to do so safely by following a simple strategy: study a major that will lead to a higher salary, such as business. Students who aren't primarily interested in business may be able to study business along with a second (more passionate) major ("double major") at no extra charge.

Good luck with your college decision!