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Oct 15, 201403:04 PMFinancial Perspectives

with Michael Dubis, CFP

Build a plan for making the most of college

(page 1 of 2)

College and tech schools just started a new semester. Seniors in high school, often with the help of their parents, are getting close to finalizing their post-high school plans. Many will look to college or tech school. Some college students are starting to think about grad school. Whatever the next step, this is a critical time for students to make clear plans about their future. Even students not looking to pursue secondary education will find value in planning ahead.

I personally think it’s not really the school but the student who makes the educational experience worth the price of tuition. One person can go to a fourth-tier college and be a tremendous success in life, while someone else can go to Harvard and provide little value to the world after graduation. Beyond college, it’s the student or employee who makes the most of his or her career through hard work, attitude, aptitude, and some luck.

I recently came across the book Get a Job, Build a Real Career, and Defy a Bewildering Economy by Charles Hugh Smith. It was a challenging read in many ways, but it was also thought-provoking. The book discusses the skills and mindset the next generation may need to be economically valuable in society and how society and the economy may change. The chapter on college planning was enlightening. 

Smith essentially encourages kids and/or their families to emphasize the importance of having an actual plan for optimizing college and then making a place for themselves in the working world. Personally, I can attest to the value of this because I went into college with a very detailed and disciplined plan, making the most of my time in school and then graduating with a positive place in the world.

I spent my college career taking advantage of resources and mentors who could help me get where I needed to go. I also enjoyed working during school because I had to cover for most of my college costs, and my parents were crystal clear: Once you’re out of school, you’re on your own financially! Having skin in the game made the experience all the more important and serious. I’m grateful for the combination of the grand plan and the fact that my parents instilled in me a sense of responsibility at an early age.

My professional advice based on my own observations is that college can either be a great investment or a colossal waste of money. College costs can run anywhere from $30,000 to $300,000. That cost should bring you some level of economic return on investment. As I’ve written a couple of times before, the student debt market is now more than $1.2 trillion, and delinquent payment rates remain high at a time when recent graduates are experiencing high unemployment and underemployment rates. In the aggregate, college could become a losing proposition for a large number of students. At a minimum, advance planning could help avoid this potential problem, and Smith’s book seems to offer a great template for making the most of one’s education. 

(Continued)

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About This Blog

It is an understatement to say the world has experienced a radical shift in capital markets. There are more layers of information and opinions on the direction of the world than we've seen in decades. The internet and the media do not always make it easier, but Michael Dubis' contribution through IB blogs will help you sift through the noise and give you some perspective. You can find his company online.

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