A New Study Calculates Return on Investment — 40 Years After Enrollment. Here’s What We Learned.

College is expensive, and prospective students, their parents, and policy makers want to know: What kind of return can I expect on my investment?

Until now, those seeking answers have been able to evaluate the payoff of a degree as measured by official data on earnings, either one year after graduating or a decade after enrolling. A new report from the Georgetown University Center on Education and the Workforce provides an answer on an even longer scale: 40 years.

“A First Try at ROI,” ranks 4,500 two- and four-year colleges that primarily offer bachelor’s or associate degrees or certificates by their return on investment 10 and 40 years after enrollment. To measure ROI, the study uses net present value, which estimates how future earnings are valued in the present. The measure, calculated using data from the College Scorecard, essentially weighs the cost of paying for college against what students could potentially earn down the line.

What do the data reveal?

Some insights are already well known as general rules of thumb, but the report offers detailed data about specific institutions: Colleges that mainly award bachelor’s degrees pay off over the long term, even though students typically take on more debt to attend four-year institutions than do those who go to two-year ones. And a credential from a two-year college or a certificate program has some of the highest return on investment in the short term, or a decade after enrollment.

What can be learned from this data by looking at the top 50 colleges on Georgetown’s list?

Audrey Williams June is a senior reporter who writes about the academic workplace, faculty pay, and work-life balance in academe. Contact her at audrey.june@chronicle.com, or follow her on Twitter @chronaudrey.