Some skeptics argue that a college degree isn’t necessary these days, but the data tell a different story.

According to the National Center for Education Statistics, among 25- to 34-year-olds who worked full time, year-round in 2022, median earnings rose with every level of education:

• High school diploma: $41,800
• Associate degree: $49,500
• Bachelor’s degree: $66,600, which is 59% more than high school graduates earned
• Master’s degree or higher: $80,200

Over a working lifetime, that gap adds up. Still, “college pays off on average” is not the same as “this college, in this major, at this price, will pay off for my student.”

That second question is the one families need to answer. There are many ways to evaluate the cost and value of a degree, and the most obvious ones are not always the most accurate.

Start with Real Price, Not Sticker Price

It’s tempting to take a college’s published cost and multiply it by four. The problem is this approach leaves out financial aid, and it assumes your student will graduate in four years. 

Instead, run the net price calculator on each college’s website. Every college that participates in federal aid is required to have one, and it estimates what your family would pay after grants and scholarships.

Then look at the college’s four-year graduation rate. Many students take longer than four years to finish, especially those who transfer, change majors late or step away for a semester.

Each extra term means another round of tuition, housing and fees, plus a later start on full-time earnings.

A school with a lower sticker price but a low four-year graduation rate can end up costing more than a pricier school where most students finish on time.

Weigh Debt Against Earnings

You might also look at the average amount students borrow by graduation. That number matters, but on its own it leaves out the other half of the equation: what graduates go on to earn.

Paying a little more upfront feels much less daunting if you know graduates of one school pay off their loans faster and earn higher salaries than graduates of another.

The U.S. Department of Education’s College Scorecard lets you compare median debt and median earnings by school, and even by field of study within a school, where the biggest differences often show up.

Use the Research Tools

If you’d like to go deeper, these resources are worth your time:

• Georgetown University’s ROI Rankings. Researchers at Georgetown’s Center on Education and the Workforce ranked about 4,600 colleges by return on investment, using federal College Scorecard data. Some of the names near the top will not surprise you. Many of them will.

• Third Way’s Price-to-Earnings Premium. This tool estimates how long it takes graduates to recoup what they paid for college. It takes some patience, since there are many ways to slice and dice the data, but if you like data, it may be your thing.

• The Common Data Set. This is a standardized report that most colleges complete each year and publish on their own websites, and it is full of hidden gems: first-year retention rates, four- and six-year graduation rates, average financial aid packages and the percentage of need met, average debt at graduation, and whether the college considers demonstrated interest in admission. The easiest way to find a school’s report is to search “Common Data Set [school name].”

• The college’s career outcomes report. Ask the career center for its “first destination” or outcomes report, which shows what graduates were doing about six months after commencement: employed, in graduate school, or still searching.

Why This Matters Even More Now: Federal Loan Changes

The federal government has changed its student loan policy, and families should factor the new rules into their planning. Under the One Big Beautiful Bill Act, signed in July 2025, most changes took effect on July 1:

• Parent PLUS loans are now capped. New Parent PLUS borrowing is limited to $20,000 per year and $65,000 total per student. Before, parents could borrow up to the full cost of attendance. Families who had already borrowed for a student before July 1, 2026, may be able to keep borrowing under the old limits for a few more years.

• Undergraduate loan limits did not change. The Direct Loans that students borrow in their own names have the same limits as before.

• Grad PLUS loans are gone for new borrowers. Graduate students are now capped at $20,500 per year ($100,000 total), and professional students, such as those in medical or law school, at $50,000 per year ($200,000 total).

If your student is already thinking about graduate or professional school, keeping undergraduate debt low matters more than ever.

• Repayment options are narrower. New loans can be repaid through a standard plan or the new Repayment Assistance Plan (RAP), which is based on income. New Parent PLUS loans are not eligible for RAP.

• Colleges will be held accountable for earnings. Under a new “do no harm” test, degree programs whose graduates do not out-earn typical high school graduates can lose access to federal student loans.

The earliest any program could lose eligibility is July 1, 2028. The practical takeaway is that for many families, the gap between what college costs and what they can borrow through federal programs is now larger.

Private loans can fill that gap, but they depend on credit and come with fewer protections. That makes the homework above more important.

Run the net price calculators before your student applies, include colleges where your student is likely to earn merit aid, and compare financial aid offers side by side once they arrive.

The Bottom Line

No matter what you decide, what matters is making the right choice for your family’s financial situation, and making it an informed one. There is no one-size-fits-all approach to college or to paying for it.

The best college for your student is one that fits academically, socially, and economically, and that sets your student up to graduate on time, with manageable debt, ready for what comes next.