Table of Contents
“I wanted to race cars. I didn’t like school, and all I wanted to do was to work on cars. But right before I graduated, I got into a really bad car accident, and I spent that summer in the hospital thinking about where I was heading. I decided to take education more seriously and go to a community college.”
George Lucas, American filmmaker
“With the changing economy, no one has lifetime employment. But community colleges provide lifetime employability.”
Attending a community college is attracting dependent students with varying parent income from a broader economic background. Though a large proportion of students come from low-income families, more students from middle-to upper middle income with annual earnings of $100,000 or more are turning to community colleges.
The rising national student debt has served as a burdensome overhang on individuals for years. Many postpone their plans like getting married, having children, buying a home, or saving for retirement.
With student debt levels remaining high, the benefits of going to community college have significant merit. Recent studies have highlighted improving earnings prospects, particularly associated with specific majors like nursing, engineering, STEM, and job-specific or skill training programs.
There are more than 1,100 community colleges nationwide currently enrolling more than 12 million students in classes annually. According to the National Center for Education Statistics (NCES), 29% of all undergrads in the US attended community (two-year) colleges in 2019.
Two Year Degrees
Students can earn two-year degrees, notably Associate of Arts, Associate of Science, or Associate of Applied Science, along with certificate programs that take various times to complete. The two-year degrees may sometimes be completed in that timeframe but are closer to 3.5-4 years on average.
Colleges sometimes partner with four-year institutions, so students to earn joint degrees such as forensic accounting.
I am a tenured professor at an urban community college, and I have added my two cents where helpful in the hopes I don’t sound too biased. For many, going to community college means saving money, attaining a degree while working, and possibly raising a family. Studies show that obtaining your two-year degree provides significant earnings potential.
Let’s review the benefits and drawbacks of Community College.
1. More Affordable To Attend A Community College
The average annual (two semesters) tuition and fees in 2020-21 were $3,770 for in-state public community college compared to $10,560 instate public four-year college, $27,020 out of state public four-year college, and $37,650 for private colleges and universities. These costs don’t include room and board costs.
About 28% of community colleges offer on-campus living arrangements. However, most community college students do not incur room and board costs, and they either live off-campus or with their parents near the school.
Related Post: How To Pay For College: A Family Guide
2. Use Your 529 Savings Plan
Tuition costs associated with community college are qualified expenses that can be withdrawn tax-free from your 529 College Savings Plan. To reduce your need for borrowing, make use of these tax-deferred plans by saving for your child’s college education as early as feasibly possible.
3. Less Student Debt For Community College Students
As a result of lower tuition and many living at or close to home, community college students carry less debt: 59% earned two-year degrees without borrowing to pay for school; 18% graduated with less than $10,000 in loans. File a FAFSA (Free Application for Federal Student Aid) application for federal loans with preferable loan rates than private loans.
Although they have less overall debt than students in four-year colleges, the community college default rates (CDR means or failure to mean loan obligations) for 2015 dropped to 16.7% from the year earlier. However, the national default rate was 10.3%, with public four-year institutions having a default rate of 7.1%.
CDRs are the percentages of a school’s borrowers who start repayments on certain federal loans during a particular year. Default rates rise to the 20+% range when calculated as repayments within 10 or 12 years of entering college—the higher rates are from minority neighborhoods.
4. A Great Place To Strengthen Your Focus and Transcript
Many students have less than stellar grades in high school and cannot pursue scholarships or get into their first school choice. They may not know what major or career they are seeking. Community college may be a great way to start, achieve A’s in the introductory courses you would be taking in four-year schools anyway.
It can provide extra time to buckle down, learn about different majors, and explore other options. It gives more time to examine four-year colleges that meet more ripened expectations. Personal and academic growth occurs at different speeds and maturity. These colleges can be an intermediate place for strengthening your writing, communications, critical thinking, and technical skills.
Finding Our Interests At Different Times
I started college at a 4-year public college just as I turned 16 years old. I was a first-generation to go to college. I often felt lost, lacked motivation, and focus in my undergraduate studies. I opted for liberal arts major as an undergrad. It wasn’t until I enjoyed working at a bank and transitioned to a business (MBA) program that I found my passion later in my 20s.
5. Greater Flexibility
For those students who are parents, help their families, have work schedules, or need amenable arrangements, community college can be more accommodative. For example, there are night and weekend classes for students who have 9-5 jobs or need to adjust class schedules as Uber drivers.
Often, adult students return to school after taking a long break and find their interests in specific programs.
By going close to a college close to home, you have more opportunities to care for your personal needs. You may have more study space, able to make your meals, and do laundry more affordably.
6. More Diversity
Broad demographics at community colleges provide a comfortable atmosphere for older students, working students, parents, and greater diversity. Two-year colleges serve a large proportion of minority, first-generation, low-income, and adult students.
About 44% of students are 25 years or older. White students account for 49% of students, with a diverse mix of African Americans, Hispanics, and Asians accounting for the rest. While 31% of dependent students’ parent annual income are below $30,000, 17% are from parents making $100,000 or more.
7. Smaller Class Sizes And More Support
Classes range from 150-300 students in four-year colleges and can be impersonal. Classes are far smaller at community colleges, more likely to be 25-35 students on average. Students get a lot more personalized attention either in the classroom or meeting with their professors. Community colleges offer significant resources to students, such as writing and tutoring centers.
8. Quality of Professors
From my experience as a community college professor, I generally know many of my students well and meet with them frequently about the courses and their business career interests. (I know I sound biased here.)
The quality of tenured professors I work with is high. They publish in high-caliber peer-reviewed journals, have worked in their respective fields, and are dedicated to their students. Many professors are faculty advisors for student-run clubs, competitions, and events, leading to more professor-student interaction.
At some of the largest and most exclusive colleges, a teaching assistant (TA) may be your teacher linked to your professor. You may have less interaction with your chosen professor than with the TA for specific courses.
9. Community College Graduates Earnings Potential
The average student who completes an associate’s degree will earn $5,400 more each working year than those who drop out of community college. The average is from $4,640-$7,160 per year, based on a working paper by Clive Belfield and Thomas Bailey.
However, a study in Washington State examined returns of graduates with associate degrees in STEM, nursing and construction found that they do significantly better than degrees in humanities, for example.
10. Lifetime Earnings Vary By Degree
Lifetime earnings illustrate the disparity between completing high school, community college, and four-year college degrees. On average, lifetime earnings are:
- $1,304,000 for a high school degree;
- $1,727,000 for an associate’s degree; and
- $2,268,000 for a bachelor’s degree.
And By Major
The $1 million difference between the changes of the above degree to $3.4 million when you calculate the difference between the lowest-paying majors and the highest paying majors like architecture and engineering. Quite a gap!
Additional research has also revealed that those with associate degree’s in many applied and technical fields can outearn bachelor’s degree counterparts five years post-completion.
Mark Schneider has been among the most persistent researchers highlighting community colleges’ values and potentially greater earnings power, particularly for community college students devoting their studies to health, engineering, and technical fields.
Community college grads who earned an associate in science degree from Florida community colleges earned an average of $47,708, above an average of $36,552 for students who graduated from a Florida four-year college. The reason cited for the big gap was that the community colleges may have had a greater focus on job-specific programs.
Still, an average college graduate with a four-year degree will generate higher earnings on average than that of community college grads. However, your major or fields of study matter, and completion of your respective degree is essential.
1. Course Offerings May Be Limited
Many course offerings are primary, designed to address the typical first two years of a traditional program, and are credits that will roll over to the senior college. Where there is significant student interest, courses may go beyond the basics.
For example, many community colleges have added more courses to provide certification for specific majors like engineering or nursing. Some programs offer specialized courses, such as Walla Walla College in California, partnering with John Deere to help students understand tractor mechanics and technical aspects
2. Less Campus Life At Community College
Community colleges are often commuter schools. It will be a less integrated experience than a traditional four-year school. However, community colleges will vary. Students may participate in sports, organizations, competitions, and clubs.
Students can get involved in student government or write for the school paper. Students at community colleges may be on campus less because of work or living elsewhere.
I teach at the community college. Students proactively join study groups through our business faculty, compete in The Fed (Federal Reserve) Challenge or Mock Trial teams on a state or regional basis, and become officers of their respective clubs.
3. Credit Transfers May Not Be 100%
Community College Research Center (CCRC) found about 80% of community college students indicate their intention to transfer to four-year colleges to complete their bachelor’s degree or higher.
However, research shows that only 29% of students who started in fall 2011 transferred to a four-year institution. Of the 29% of these students, 42% completed a bachelor’s degree within six years. That equates to about 12% of the 2011 group of entering community college students earning a BA within six years.
How Can This Rate Improve? Be Proactive
Ideally, as community college students benefit from lower tuition costs, you want all your credits to count towards your four-year BA degree, which usually requires 120 credits. Most community colleges have transfer agreements (sometimes called articulation agreements) which are formal agreements with four-year colleges documenting the transfer policies.
These agreements assure that the senior college will accept your credits. There are times, though, when you may lose credits if the content of the community college course is not in line with the requirements of the senior college.
Keep Track Of Your Transferrable Credits
Losing these credits can be frustrating for community college students hoping their classes count towards graduation at four-year schools. It is the student’s responsibility, and their community college’s to keep track of transferrable credits.
It is essential to research the programs at your preferred college. Meet with your advisers who may have updated information and can guide you during course registration.
Make sure to attend transfer programs on your campus. You can meet with admissions officers from your preferred college list and learn how they will treat your credits before you apply there.
Picking your college is an individual choice, and you have many school choices.
For many, community college can be a great choice, allowing you to save money, and mature into stronger students. If you need flexibility because of your life schedule, it may be a perfect solution for you.
You may attend community college as an accomplishment on its own or as a stepping stone to a four-year degree or more.
A Favorite Success Story To Share!
Early in my career as a professor, I got to know one of my students in my business law class. A few weeks into the term, she admitted to me that she did not like business law at all. I told her to give it more time and stop by if she needed help picking a case for her term project.
The assignment was to pick a constitutional case with a meaningful precedent and future research cases and legal research about this precedent. This student picked Brown vs. Board of Education, a 1954 case. Her paper was excellent with terrific research, and she received a well-deserved A.
She said she enjoyed the law class after all. She graduated with Honors, went on to complete a four-year bachelor’s degree. Before she graduated, she came to visit me, asking for a recommendation.
I said, “Sure, but where?”
She said, “You know, professor. LAW SCHOOL!”
This student received acceptances and scholarships from several law schools and today is currently practicing. While this story stands out, I have many student success stories to share in the future.
Thank you for reading! Please visit The Cents of Money for more articles of interest.
Have you considered community college among your choices? What was most important to you when making your final decision? We would like to hear from you!
With a passion for investing and personal finance, I began The Cents of Money to help and teach others. My experience as an equity analyst, professor, and mom provide me with unique insights about money and wealth creation and a desire to share with you.