Putting money into a four-year U.S. college education turns out to be a better financial investment than putting money into the stock market.
The rate of return on the money spent to earn a bachelor's degree is 12 percent per year, compared with the long run average annual return on stocks of 7 percent, according to an Arizona State University study, "The Value of Higher Education: Individual and Societal Benefits."
Over the course of a lifetime, those with a college education make $1 million more than people with a high school education.
The net return is over all costs, including individual contribution and state appropriations, as well as income sacrificed while earning that degree, says study leader Dennis Hoffman, of the W. P. Carey School of Business's L. William Seidman Research Institute; Kent Hill, of the Department of Economics and Center of Business Research and Tom Rex, of the Center for Business Research.
Despite the high return on investment, 25 percent of the U.S. adult population has a bachelor's degree, while more than 50 percent of Americans invest in the stock market, according to the American Shareholders Association.
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