A college education is an investment in the future. But as with any investment, it’s important to consider what you’ll get in return — your return on investment (ROI) — to determine if the cost is worth it. Hence, college students and their parents weigh the cost of college against future earning potential, as well as intangibles such as friendships, network building, and soft skills.
This guide explores the “return on education” for bachelor’s degrees and offers insights into how to maximize the value of your college education.
Table of Contents
Key Points
• Choosing the right degree and college to attend depends on many factors, including tuition costs and the return on investment (ROI).
• The ROI for your education will depend largely on how much you spend on your schooling, what type of job you get after graduating, and what you major in
• Getting a certification can help boost your earning potential.
• In addition to the cost of higher education and earning potential, benefits such as acquiring life skills and becoming part of alumni networks should also be considered.
• Scholarships, grants, federal aid programs, and private student loans are ways to help fund your tuition fees.
Average Cost of a Degree
Choosing the right college is a multifaceted decision. Considerations include the school’s location, whether it offers programs that meet your interests, what the student culture is like, and, of course, tuition costs.
The price tag for college can be jaw-dropping. The average cost of college for an in-state student attending a four-year university is $27,146 per year (including living expenses). Students who attend private, nonprofit universities spend an average of $58,628 per year living on campus.
💡 Quick Tip: Fund your education with a low-rate, no-fee SoFi private student loan that covers all school-certified costs.
ROI by Education Level
You can determine your ROI by education level by looking at the ratio of the cost of your degree to your expected income once you graduate. Your return on education is much like a traditional ROI calculation, which looks at the ratio between net profit and cost from investing resources.
In this case, time and money are the resources you’re investing, and your future income is the profit. The ROI for your education will depend largely on how much you spend on your schooling, what type of job you get after school, and, to a certain extent, what you major in.
Median ROIs for a College Degree, per the Education Data Initiative
|
Education Level |
20-year ROI |
40-year ROI |
|
Associate Degree |
80.88% |
545% |
|
Bachelor’s Degree |
142.4% |
841.7% |
|
Master’s Degree |
84.78% |
472% |
|
Doctoral Degree |
82.2% |
623.5% |
|
Professional Degree |
554.5% |
2,248.6% |
Associate Degree ROI
Students can typically complete associate degrees, which are often offered at community colleges, in one to two years, making them more affordable than four-year degrees. According to data from the Education Data Initiative, the ROI for an associate degree is 80.88% after 20 years.
Bachelor’s Degree ROI
Bachelor’s degrees typically take students four years to complete. According to the Education Data Initiative, the ROI for a bachelor’s degree is 142.4% after 20 years. However, this estimated ROI can vary greatly based on the major you pursue. For example, computer science degrees offer an ROI of 716.6%.
Master’s Degree ROI
A student can obtain their master’s degree after receiving their bachelor’s degree. This degree allows them to specialize in a specific area of interest, such as a master’s in business administration, or MBA. The ROI for a master’s degree is 84.78% after 20 years, according to the Education Data Initiative.
Doctoral Degree ROI
A doctoral degree is generally the most advanced degree one can get in a particular field. Doctorates can take up to eight years to complete, though the exact timeline will vary depending on factors such as the program type, structure, and research conducted by the doctoral candidate. The estimated ROI for doctorate degrees is 82.2% after 20 years, according to the Education Data Initiative.
Professional Degree ROI
Professional degrees are advanced degrees that prepare a graduate to work in a particular field, such as law or pharmacy. After 20 years, the ROI for a professional degree is 554.5%, according to the Education Data Initiative.
Highest-Earning Degrees
The return on education will vary depending on the degree program you choose. For example, a student with a computer science degree may earn more than an English major. There are exceptions, but it’s a good idea to understand the norm for particular fields. Below are some of the highest-earning degree programs.
Associate Degree
An associate degree takes about two years to complete and can often be finished at a community college for significantly less than it may cost to get a four-year degree. Associate degrees often allow students to specialize in a specific trade or field, and, in some cases, this specialization can lead to a high-earning career.
One of the top-earning post-associate degrees is in air traffic control. According to the Bureau of Labor Statistics (BLS), air traffic controllers earn a median income of $144,580.
Dental hygienists, MRI technicians, and funeral service managers all earn an average salary of $70,000 or higher, making these associate degrees with high earning potential, as well.
Bachelor’s Degree
According to Best Colleges, bachelor’s degrees with the highest earning potential include chemical engineering, computer engineering, computer science, finance, and business analytics.
For example, in 2024, chemical engineers earned a median salary of $121,860. Financial analysts earned a median salary of $101,910per year, according to the BLS.
Certifications
Some people may consider adding a certification to their resume to boost their earning potential. Professional organizations often award certifications for specific skill sets. Some top-earning, in-demand certifications include those in project management and data engineering.
Recommended: Guide to Student Loans for Certificate Programs
Bachelor’s Degree ROI by Major
The ROI can vary quite a bit based on the type of bachelor’s degree pursued. Computer science degrees have some of the best ROI for bachelor’s degrees — about 1,752.5% over 40 years, according to the Education Data Initiative. Below is a list of majors and their estimated ROI after 40 years:
• Business finance —1,842.3%
• Business accounting — 1,286.6%
• Electrical engineering —1,082.3%
• Biology — 225.0%
• Communications —441.8%
• Architecture — 502%
• Fine Art — 244.1%
Consider What Can’t Be Measured by Money
Yes, going to college or pursuing other higher education opportunities can be expensive. But in addition to the cost and potential boost in earning potential, there are a variety of intangible benefits that students can’t measure in dollars. For example, college students living on campus can gain a newfound independence and develop important life skills.
Plus, many colleges have strong alumni networks that can help students find jobs after graduating. Students have the chance to get to know themselves better while making lifelong friends.
Recommended: How to Budget as a College Student
Controlling Costs
One way to improve ROI is to decrease the amount you are paying for school. This could be particularly useful if you already know you want to pursue a career in a relatively low-paying field.
Scholarships
You can offset the cost of tuition by looking for scholarship programs that help pay your tuition and other college expenses. Many schools offer need-based financial aid to families who might otherwise struggle to pay tuition costs. In some cases, you could even get a full ride.
You can find scholarships by looking at your school’s financial aid website, connecting with your guidance counselor, or reviewing databases or online scholarship search tools.
In some cases, you may be able to apply for unclaimed scholarships to help supplement the aid you have already received.
Grants
Students may qualify for grants directly from their school or through federal financial aid. Grants typically do not require repayment, so they can be an incredibly helpful addition to a student’s financial toolkit when paying for college. Pell Grants are one type of grant awarded by the federal government to students who demonstrate exceptional financial need.
Pell Grants are available to undergraduate students. However, to maintain eligibility for a Pell Grant, undergrads must also meet satisfactory academic progress requirements.
Student Loan Forgiveness Programs
If you need to take out student loans to help pay for college, keep an eye on your terms and interest rates to help keep costs down. If you take out federal loans and plan to work for certain nonprofits or government organizations, you may be eligible for loan forgiveness under the Public Service Loan Forgiveness (PSLF) program. After making 10 years’ worth of qualifying monthly payments, the remaining balance of your loan may be forgiven through this program.
Private Student Loans
Private student loans don’t qualify for federal benefits such as PSLF, but they can be helpful tools for students who have exhausted their federal financial aid.
If you’re interested in paying for college or another higher education degree with a private student loan, take the time to shop around and review interest rates, terms, and other fees or benefits that lenders offer.
Employer Support After Graduation
Finally, some employers may also help you pay back your student loans as part of a benefits package. Consider working for an employer who offers these benefits.
Recommended: Finding Jobs That Pay Off Student Loans
The Takeaway
College students can estimate the return on their educational investment by comparing the cost of their degree to their lifetime earnings. Though important, the money you’ll eventually earn isn’t the only thing you should consider when choosing a college. Getting a bachelor’s degree can help you acquire skills and expand your horizons in ways that aren’t directly related to your degree or job prospects.
When you decide on the right school for you, take the time to consider all your options — including scholarships, grants, federal and private student loans, post-graduation repayment programs, and other sources of public and private funding — to help you achieve your education and career goals.
If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.
FAQ
What is the average return on investment for a college degree?
The average t ROI for a college degree varies by field, but generally, bachelor’s degree holders earn significantly more over their lifetime than those with only a high school diploma. On average, the ROI for a college degree ranges from 9% to 10%, but it can be higher depending on the major and the institution.
Which degree has the highest return on investment?
Degrees in fields such as engineering, computer science, and technology typically have the highest ROI. These degrees often lead to high-paying jobs with strong job security and growth prospects, resulting in a significant lifetime earning advantage compared to the cost of education and making them highly valuable investments.
Is a bachelor’s degree a good investment?
A bachelor’s degree is generally a good investment, as it can lead to higher lifetime earnings, greater job stability, and more career opportunities than having only a high school diploma. However, the ROI depends on the chosen field, the cost of education, and individual career goals and outcomes.
SoFi Student Loan Refinance SoFi Loan Products
Terms and conditions apply. SoFi Refinance Student Loans are private loans. When you refinance federal loans with a SoFi loan, YOU FORFEIT YOUR ELIGIBILITY FOR ALL FEDERAL LOAN BENEFITS, including all flexible federal repayment and forgiveness options that are or may become available to federal student loan borrowers including, but not limited to: Public Service Loan Forgiveness (PSLF), Income-Based Repayment, Income-Contingent Repayment, extended repayment plans, PAYE or SAVE. Lowest rates reserved for the most creditworthy borrowers. Learn more at SoFi.com/eligibility. SoFi Refinance Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.
Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
SOISL-Q126-037