It’s clear that college degrees offer the opportunity for a happy life. But it’s also clear that happiness has eluded a great many people. So, should your clients’ children and grandchildren go to college or not?
In 2015, almost 60% of Americans said yes — that they had “a great deal” or “quite a lot” of confidence in higher education.Now, only 42% say that. More than a third of workers say college didn’t teach them the skills they need for their jobs — and employers agree: 40% of them say that college graduates are not prepared to enter the workforce.
College can be the best possible path for a teen. But that path can be treacherous, and you need to help your clients make sure not only that their child or grandchild walks that path safely and successfully, but that they ought to walk that path in the first place.
After all, if getting a good job is the primary reason for going to college, your clients and their children need to know that there are hundreds of fulfilling, financially rewarding and emotionally enriching careers that don’t require a college degree. For example, commercial pilots, police detectives, nuclear technicians, power dispatchers, transportation managers, elevator installers and radiation therapists earn median salaries over $100,000 a year — higher than median salary of $83,356 a year for college graduates.
So, make your clients answer this question: What does the child want to get out of college? "I want to go to college” isn’t a goal, it’s a starting point — the student achieves this goal as soon as they set foot on campus as a freshman.
Instead, your clients need a more precise goal for their teen: To graduate from college in four years, debt-free, on the dean's list, with a degree that lets them have a career in the field they want to work in.
A four-year degree is often anything but. Only about 44% of students finish their bachelor's degree in four years, and more than a third drop out or take more than six years to finish. Delaying graduation leads to extra tuition costs and delays in earnings, debt repayment, promotions and raises that compound over time. Graduating two years late can mean a loss of hundreds of thousands of dollars or more over the course of a career, especially in a high-paying field.
Roughly 70% of graduates left school last year with debt, owing nearly $42,000 on average — which causes them to delay buying a home, getting married and having children. By failing to graduate on the dean's list, they fail to gain all the knowledge their professors taught, and they are at a competitive disadvantage in the job market. And finally, they must focus on entering a career in the field they want to work in. This is important because there’s a lot more to life than making money.
You’ll be providing a huge value to your clients by talking with them about the future path of their kids and grandkids. Nothing is more important to your clients than their offspring, so devoting attention to them will help your clients become devoted to you.
And the advice you give will be some of the most vital that you ever provide.
Ric Edelman is an author and founder of the RIA Edelman Financial Engines. He now leads the Digital Assets Council of Financial Professionals. Ric’s latest book, The Truth About College, debuts Dec. 4. It is being published by John Wiley and Sons.
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