COVID-19 has brought interesting challenges for many parents with first-year college students. Students must decide whether to take Zoom classes or wait until on-campus classes open in Fall 2021.
As a parent, you may be wondering which route would be best. But, no matter what your child chooses, there are benefits and risks associated with each. Beyond missed classes and taking a bit longer to graduate; there are many opportunity costs to taking an extra year or two to finish college.
The Opportunity Costs of Graduating Late
Extra Tuition and Debt
Paying for your child to spend an extra year or more in college isn’t cheap.
- The cost of staying in school for an additional year means an extra $18,598 in tuition and interest on loans.
- The cost of an additional year at private colleges would be even higher, nearly $26,815 in additional tuition and interest on loans.
- Taking two extra years to finish college (six years total) racks in added costs of $37,456 at public institutions and $53,760 at private colleges.
Lost Wages
Here’s another thing to consider, not only do students who spend an additional year in college wind up paying more tuition upfront but delaying their career by a year can cost them thousands in future earning potential.
Did you know that taking an extra year to graduate college means missing out on nearly $90,000 in lifetime earnings?
Where does this loss in earnings come from? About half of that is the $43,000 starting salary that new graduates typically earn in their first year of work, and taking two extra years to graduate would result in $94,353 in missed income.
Even when late graduates do finish, they’ll always be a year behind, and those differences add up, and while the gap closes, those graduating late never catch up to those who graduated on time. Those costs add up and amount to $90,000 over a working lifetime.
Less Retirement Savings
College students who take five years to finish college will miss out on $82,074 in retirement savings compounded over 45 years, based on directing 7.1% of their income (the average contribution rate for people under 25, according to the Bureau of Labor Statistics) with standard 7% annual returns. If you take six years to graduate, then you’ll miss out on $150,882 in compounded savings.
Graduate on Time with Credit-by-Exam
A better alternative? Using Credit-by-Exam with Smarter with Achieve.
Credit-by-Exam allows your child to earn college credits toward their degree by taking one standardized exam. With Credit-by-Exam, your child can knock out their general education courses quicker without sitting through a Zoom class or waiting until campuses reopen.
Since your child will be taking the exams instead of sitting for a class, you get to save on the cost of tuition, room, board, and other college expenses. According to the College Board, if your child earns 15 test-out credits towards a college degree, you can save up to $17,000 on the cost of schooling!
Smarter with Achieve Can Help
Although Credit-by-Exam is the fastest way to earn college credits, it is certainly not the easiest. Traditionally, students who take Credit-by-Exam tests have to study and acquire knowledge of the test independently. Credit-by-Exam tests can be more challenging than traditional college courses for this reason. But, this is where Smarter with Achieve can help.
At Smarter with Achieve, we offer exam guidance to help your child study for Credit-by-Exam tests. Every learner at Smarter with Achieve gets…
- Expert exam guidance. Our live courses and dedicated instructors will ensure your child is ready for test day.
- A library of study materials. After you register your child with Smarter, they’ll get practice tests and guidelines, so your child will be confident when facing their CLEP, DSST, or ECE exam.
- Exam-specific questions. Get access to exam-specific questions to help your child ace CLEP exams.