Going to college is important to financial success. MIT Economist, David Autor, calculated that not going to college costs an individual up to $590,000, even after taking college costs into consideration. Although many assert, quite accurately, that what you do in college matters more than where you go, the type of college chosen could have an effect on success after college. One measure of financial success is the ability to repay student loans. Families can see student loan default rates on a per school basis www2.ed.gov/offices/OSFAP/defaultmanagement/cdr.html.
Rather than the specific college a student chooses, Looney and Yannelis conclude that choosing a for profit or other less selective college can actually have an impact on student financial success after college. Their study, released by the Brookings Institution in 2015, brookings.edu/about/projects/bpea/papers/2015/looney-yannelis-student-loan-defaults, concluded that the rise in student loan defaults was largely isolated to students enrolled in for-profit institutions and, to a smaller extent, other less-selective colleges. They suggest that the negative outcomes for these students are partly due to socioeconomic status and the fact that they were enrolled in higher education institutions with lower graduation rates.
Families searching for colleges should look at graduation rates and student loan default rates as indicators of future success or failure at that college. Another important area to look at in colleges is the level of resources devoted to helping students gain full-time, professional employment in their field after graduation. College is an investment that when managed wisely can pay huge dividends for the student.