Is a college degree really all that important as people claim to be?  Sterling White took a shrewd look at higher education. He said thanks to today’s technology and an array of learning options, one could learn the trade they need without falling into serious debt for the rest of their of one’s life.

This is a fairly astute observation. After all, most people attended college to take a few classes and even earn a degree. However, what you may learn in college, you may never really use in your career. You’ll meet new friends and could even form lasting friendships, but if you look at it from a financial perspective, all this doesn’t vindicate the cost.

Yes, there are some careers that demand you get a college education – medicine, engineering, lawyer, etc. However, if you’re not going into one of them fields, perhaps it’s better to find another avenue of learning that will help you to succeed in life. There are a plethora of choices to help you out here.

Why College Is Overrated Especially From A Financial Standpoint

College may be just financially overrated if you think about it. Financial columnist Jack Hough did a thought experiment to lay out this reality:

Two childhood friends, both hard workers and good families, saved nearly $17,000 for college.

One friend is unable to get into the college he wants, and decides, at 18, to invest the college savings into a mutual fund of the stock market.  This friend makes a high school graduate salary for a time and then tops out over $32,000. Every month, five percent of the after-tax income goes toward the stock fund, which gives him an eight percent yearly return.

The other friend, however, goes to public college for two years and then a private one, spending a total of nearly $50,000 in tuition – not including room and board. He leaves the college with $34,000 debt. The $16,500 saved isn’t enough, meaning the remaining balance is around $17,000 at a five percent interest rate.

This friend starts out a higher pay than the other friend, peaking at $56,000. He also set aside five percent for his retirement. It’ll take him 12 years to pay the loan off. This friend will be debt free at 34 and able to add more to the index fund with the higher pay he’s earning.

However, when they both see each other at 65 for the retirement party, it’s the non-college friend that has $1.3 million in savings, not the college-going friend, who has less than a third of it.

It’s Just Wishful Thinking…College Graduates Don’t Always Earn A $1 Million

Those, the idea that you can earn a million bucks by going to college is just a myth. The U.S. is devoted to credentialism, which means the brightest and hardworking people are attending college.

What’s being compared here is a lawyer who earned a college degree and a plumber who didn’t. Comparisons are also being made on college graduates getting into the workforce against the underprivileged.  These comparisons actually mean nothing at all.

Degrees also make the difference in how much a person would make. For example, CBS News did an article about the worst earning college degrees. The worst degree was a Child and Family Studies degree, which had a starting salary of $29,500 and a mid-career salary of less than $40,000. An Art History degree would give a mid-career salary of $57,100 after starting out around $39,000.

Compare this to a plumber or electrician that go to trade school – they earn around $53,000 starting out.

This does not take into consideration the mountains of student debt that college-going students are faced with upon graduation. Outstanding student loan debt now stands around $1.4 trillion. This is bound to get worse before a remedy is found and turns around. According to Forbes’ writer Steve Odland, colleges have been increasing rates at an average of seven percent a year for years.

Does A College Degree Give You Everything You Need?

You may think that going to college means you’ll learn more than if you didn’t go. However, it appears that many students attending college today know less about American government, history and economics than they did when they were freshmen.

The Intercollegiate Studies Institute released a report showing that the average college senior failed in understanding American civics.  These are college graduates.

It would appear that the credentialism obsessions is leading to credentials inflation, with more people going to college.  In 2012, more than 50 percent of college graduates were underemployed or unemployed.  This was also when the rate of student loan defaults began to rise.

The Chronicle shows that one in five government loans that were in repayment have gone into default. The rate increases on loans given to students from two-year college and even higher for students going to a for-profit institution.

What Are The College Alternatives?

As you see, going to college isn’t all the hype some have made it out to be.  Many professions like electricians, plumbers and others have done significantly well for themselves without the need of a college degree. While you may begin low, it takes mere years to move up the pay scale. Best of all, you don’t have the debt that college graduates are burdened with.

You also have the choice of becoming an entrepreneur, which has seen a sharp decrease in the last few decades. In 1975, nearly 15 percent of businesses were a year old or less. In 2010, that percentage was less than half.

Is this due to the college obsession that credentials is all that matters in the workforce?

What To Keep In Mind?

College is important for some people – there’s no doubt that. If you plan to become a doctor, then going to college is essential. However, college is not what happens after high school. Many people choose that course of action, but are not setting themselves up for anything better and are even doing more harm than good.

Consider the college alternatives such as real estate investment or other entrepreneurship ideas.