Study overseas for a Degree is worth the cost: New report
Posted on June 24, 2019
The latest report by Federal Reserve Bank of New York reveals that Study overseas for a Degree is worth the cost. The University and college education costs are skyrocketing and many students are crippled with debt. However, the report says that it is still a financially sensible decision to study overseas for the University degree.
The New York Federal Reserve Bank research reads as follows:
“It is found that the average Rate of Return – ROR has declined marginally in recent years. This is owing to the increasing costs. However, it remains at a high of 14% that easily surpasses the threshold for an investment that is good.
Thus, it appears that the rising costs of University/College education have somewhat eroded the worth of a Bachelor’s degree. However, it remains a good investment and worth the cost for the majority of the people”.
The report elaborates that College graduates earn more in comparison with their peers having lower qualifications. The College wage premium increased to around $30,000 from $20,000 during the 1980s and 90s. After 2000, this settled into a comparatively slender range of $35,000 to $30,000.
The College wage premium is currently substantial, reveals the report. The Bachelor’s degree holder on an average earns $78,000 annually which is an increase of 75%. This is in comparison with a yearly income of $45,000 for a worker with just a High School Diploma.
It is our estimation that the ROR for college was between 8% and 9% till the early years of 1980. It then rose to nearly 16% in the 1990s following the economic expansion fuelled by technology. This remained more or less the same during the Great Recession.
Over the past few years, ROR seems to have declined marginally, explains the report. It has drifted below by approximately 2% points to around 14%, it adds. This percentage exceeds several benchmarks for investments. It includes long-term ROR on stocks with 7% or bonds with 3%, concludes the report, as quoted by the Study International.
Meanwhile, Merrill Lynch and Age Wave made public a report earlier this year. It found that 36% of the graduates from college who were paying off education loans differed from this view. They said that the debt was not worth it, says the ML&AW report.
Go Banking Rates also held a poll in this regard. It found that 88% of the participants in the US said that they do not regret the decision to go to College.
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