Choosing the right college is a critical step in avoiding a student loan nightmare. Expensive doesn’t always mean better, and going to the “best” school isn’t always the best investment. If graduate school is in your future, saving money on your undergraduate education is a really smart move.
Before sharing the many reasons an inexpensive undergrad pairs nicely with grad school, I’ll share my bias on this topic. I borrowed very little to attend a state school before enrolling at a top law school. I don’t think this approach will work for everyone, but I do think it is a strategy that should get more serious consideration.
Your Undergraduate Degree Doesn’t Really Matter
Many high schools, families, and friends put a huge emphasis on going to a “good” college. Attending a top school sends the message that you are on your way, and the future is bright. Sadly, the people who make the decisions that impact your future won’t care about where you went for undergrad.
For starters, there is plenty of evidence to indicate that the school you attend doesn’t matter. If we take a deeper dive and look at students with graduate educations, the undergrad degree is even less important. Think about it this way: if you went to your doctor’s office, would you rather see a Yale pre-med diploma or a Yale Medical School diploma on the wall?
You might argue that even if your undergrad school doesn’t matter after graduate school, it matters when applying to graduate school. However, graduate schools are far more concerned about other factors. Schools do care about program rankings. However, the school is only concerned with how it does compared to other schools. Most colleges don’t care where a student attended undergrad.
To make sense of this distinction, let’s look at things from the perspective of a college. Schools want to rank highly on rankings such as the ones prepared in US News and World Report. A high ranking helps attract top students and helps current students land jobs. The importance of ranking well creates a huge incentive to score well according to the US News evaluation criteria. Take a look at the top business school methodology. Undergraduate grades and test scores are significant factors. Undergraduate school doesn’t enter the equation. If the school cares about US News rankings — and they do — they will be more likely to admit a student with high grades and test scores than they will someone from an elite undergrad.
Graduate School is Often Shorter
If you are getting your Ph.D., graduate school will obviously be longer. However, for those getting a Master’s or a professional degree, the graduate education takes less than four years.
Living with expensive tuition for one or two years is costly but not nearly as bad as four to five years of expensive education.
Many students and families cannot afford to attend an expensive graduate school and an expensive undergrad. If finances dictate picking one or the other, graduate school is an easy call.
Graduate Debt is Less Dangerous
Turning to the subject of student loans, if you amass a large amount of student debt, you want it to come from graduate school.
The analysis here is simple. Federal student loans are far better than private student loans. Federal loans have excellent borrower protections like income-driven repayment and a variety of student loan forgiveness programs. Private lends are far less borrower-friendly.
If you attend an expensive undergraduate school, the federal loans available are limited. Many undergrad students resort to large amounts of high-risk private loans. For graduate school, the majority of the federal limits are lifted. Most graduate students can finish school without needing any private student loans.
A Cheap Undergrad is the Smart Play
As a senior in high school, picking a college seems like a massive life decision. In the long run, it is likely insignificant.
If you are someone with aspirations of earning an advanced degree, don’t get carried away picking an undergrad school. Save some money. Focus on getting good grades, and set yourself up to reap the benefits of a prestigious education without all of the costs.
