Understanding College as an Investment

College Search Starter Kit: Post 3

“I’m often asked what makes the difference between a college decision and a college investment, and for me the difference lies in the fact that an investment should continue to generate returns over time. In other words, I think most students initially view college as a decision on where to spend the next four-years until they can move on to their “real” life, but for me college shouldn’t be like that. College should be an integral part of a life in progress, and perhaps more importantly, your college investment should continue to generate “returns” throughout your life. For example, when a young family buys a house they don’t make their decision based solely on what they need today, they think about how their needs will change over time, from the quality of the neighborhood schools to possible career paths and commute times; then find a house that will continue to bring value into the future…college should be like that. Let’s talk about how to truly invest in your future… 

Rebuilding the Your Path website is something I’ve wanted to do for several years, but as a non-techie the task felt overwhelming. Creating the content for the site was easy, after all I love the topic and have been creating resources, blogs and presentations on the college search process for over a decade, but stepping back from the content to think about things like page layouts, blog formats and SEO optimization; then figuring out how to execute that from a technical perspective can be a bit daunting.

Fortunately my husband, and for the second time because he rebuilt the website a few years ago when I had a similar vision, offered to help make this new website a reality. But once again, being the communications and process fanatic that he is, he insisted I first plan exactly what I wanted this new website to be, for whom I was creating it, and what my core messages would be.

The first two parts were easy. I wanted to turn my website itself into a free resource that every college-bound student around the world could use to begin the process of making a wise college investment, and I wanted to take my premium college consulting advice and share it via an affordable, accessible and easy-to-use eBook (coming soon!). 

But that third part is always a little more challenging. Not because I don’t have a core message, but because I have a lot of core messages – all of which I think are important, and all of which I love to share. So the act of distilling everything I have to say about my passion into a handful of highly targeted, useful, and captivating snippets is really difficult. 

In the end I decided to focus this website on what I consider to be the three most critical aims of the college process because they are, for me, what transform a traditional college decision into a lifelong investment. So if we agree that finding the “right fit” is a common aim of all college searchs, then these three additional aims are what root my process into the modern world, and drive students to come away with something far more valuable than a new section on their resume.

So If you haven’t already, I highly recommend you go back and read through my home page, and definitely the first and second posts in this College Search Starter Kit series; because in this post we are going to discuss the second critical aim, which is to treat your college decision like what it is…a long term investment.

Now when it comes to investing there are few people who do it better than Warren Buffet, known as the Oracle of Omaha, and one of the wealthiest individuals on the planet (he has a current net worth of around $80 billion!). But the beauty of Mr. Buffet’s success is that he isn’t an oracle at all, he simply applies some very basic principles to his investment decisions – a practice called value investing.

In a nutshell (and in very basic terms as I’m in no way an investment sage), value investing is about conducting rigorous research on companies in order to identify stocks that are currently underpriced. The idea being that these stocks will inevitably rise in price to catch up with the true value of the companies. In other words, it’s not about buying the lowest priced stocks on the market anymore than it’s about buying the most expensive or “hottest” stocks. It’s about investing in the companies with the most intrinsic value…those that represent the best bargains and therefore have the best chance of providing a long term return on investment.

But how can we apply value investing to selecting a college? To see let’s quickly look at another major life decision, one most people can better relate to – the process of buying a home. 

Before buying a new house most people conduct extensive research – research that goes far beyond the price, location and size. They typically begin by assessing their needs, projecting as far into the future as possible as they consider factors such as whether they plan to have kids, where they are likely to work, and whether they are likely to need to move again in the future. Then, once they have a firm grip on their long term needs, they go out and find neighborhoods that meet those criteria; eventually generating an initial target list of neighborhoods and properties. After that they conduct research on surface factors, like general location (similar to the five pillars of the college search), and secondary factors, such as the potential future resale value of the homes. During this process they are likely to discuss their decision with family and friends, and are likely to enlist the help of a professional who can provide insight, ideas and expertise – plus help organize the search and manage the decision-making process. Finally, after weeks of weighing the decision, visiting the homes, and driving through the neighborhoods, they narrow their options down and start making offers.

If you’ve noticed the above process sounds almost identical to our ideal college decision framework from the last post, you’re right! That’s what makes learning the decision-making process as part of your college search so valuable – you can use it time and again throughout your life to turn difficult decisions into strategic investments!  

The problem is, most students employ a decision-making process that misses those additional steps we introduced in the last post (like beginning the process with a deep self-analysis), which can still end with a positive result, but also increases the chances you end up with a college decision that feels great today, but you quickly come to regret.

Now obviously college isn’t the same as stocks or a houses – and that poses some unique challenges when trying to differentiate one school from the next (i.e. choose where to invest your time and money). Whereas a stock or a house is a tangible thing, and fundamentally the same no matter who purchases it; a college experience is a bit different. College is less a “thing” and more a string of interactions, experiences, connections, and impacts. Sure there are rankings, buildings and graduation statistics, and those should absolutely be assessed as part of the due diligence process, but they only make up a small part of the bigger picture. In other words, they can only go so far in predicting how well any one individual will fare, and what they will experience once on campus.

Take me and my husband for example. If you remember from my own story in the last post I loved my undergraduate experience, but despite the fact that our profiles were essentially the same coming out of high school, and our wish-lists were almost identical, our experiences and feelings about those experiences couldn’t be more different. But why was this the case? 

Well with hindsight I can say it is because we both did the same level of surface research, which is to say we both followed a more traditional college search approach focused on the five pillars, and that approach led us to an educated guess rather than a strategic decision – and he guessed wrong.  Said another way, we both “purchased” a four-year experience, conducting research on a level more aligned to perhaps purchasing a car, rather than strategically investing in our future by conducting research more in line with investing in a home.

To bring the point home, what I’m saying is even Harvard isn’t valuable simply because it’s Harvard. If you dislike the experience so much you can’t bring yourself to study, transfer before graduation, graduate at the bottom of the class, or take on so much debt you’re forced into a career you never wanted, the value you extract from the experience will be debatable.

So the question becomes, how can you assess the value of a given school so that you can make a wise investment?

For me it begins with a shift in the way we think about the college decision. As I’ve talked about in other posts many of us have a tendency to look at colleges like products on a shelf. We look at the branding, tour the buildings, review some key statistics, test the idea out on friends and family, and try to project how useful the degree will be in the immediate aftermath – such as finding our first job.

And that is exactly what we should do…to start!

But once you start to move from a broad target list of schools to a short-list, you need to find a way to differentiate similar schools to find the best values. You need to value invest!

And that begins with understanding each school’s unique value proposition – that is, what they purport to offer that is unique from other schools, and how that is going to move YOU toward YOUR goals. This applies even if your goals are still a bit uncertain.

With my private college consulting clients I use a numbers based model to help students identify each school’s unique value proposition and to assess how “valuable” each proposition truly is based on the student’s personal goals, but the important thing for this post is to simply understand that the level of insight required to truly value invest in a college can only come from beginning your search process by establishing your personal success criteria (i.e. what you need from the college experience in order to thrive and be happy in life) through self-analysis; then by conducting a deeper analysis of the five pillars, plus a handful of important secondary factors, to ultimately invest in the school that represents the best bargain for you. 

To borrow a cliche, one man’s trash is another man’s treasure…and that is equally true of colleges. The most important thing is not to find US News and World Report’s best college, it’s to find the best college situation for you!

What are you truly getting in return!?
So to be clear,
where so many students come up short is that their college decision is based almost exclusively on the five pillars (academic, geographic, social, extra curricular and financial) – and how those pillars will impact the next four years of their life. Yes, some students also think about their desired career and how a given school may increase or decrease their chances of landing that first job, but even that level of consideration is far too narrow. You may be paying as much as six-figures for this education, and it would be foolish to demand nothing more in return than four-years of memories and a piece of paper to carry into your first set of interviews. 

So to illustrate the point,I’ll give you an example of a secondary factor that I consider a major driver of long term value, but which is almost always overlooked by college-bound students; then leave you will a handful of sample questions that lead to a deeper understanding of how the five pillars can impact your life long after college graduation (i.e. a starter list of deeper factors you should definitely consider in detail when conducting your search!).


A perfect example of a secondary factor would be the strength of a school’s alumni network. Now it may seem a bit strange to be thinking about college alumni networks before you’ve even graduated high school, but imagine five years into your career as an investment banker your job is replaced by a computer program. Will you have a robust alumni network to rely on to help you find a new job? Will your alma mater have any programs, systems or departments in place to help you build a new career network? Have your fellow alumni stayed connected to the school and do they actively seek ways to help other alumni, or did they all scatter after graduation and never look back?

The point is, students seldom consider factors like this when choosing a school, but these are the things that distinguish a college purchase from a college investment that can pay lifelong returns. 

What are some other factors like this? Well there are lots of secondary factors, and the importance of many of them will depend on the individual student. That said; many of them are buried within the five pillars, but you only see them when you take a deeper look and really commit to understanding the impact each will have on your long term happiness. For example, consider some of the following pillar-based questions as you plan your college search:

How will the location of your school impact the time you can spend with family and friends long after graduation? 

Will you be okay if your best job opportunities are across the country from your parents, or with leaving your college friends behind to return home after four years for a job? 

Will you find it hard to settle down later in life if you never had an adventure away from home?

If you really think about it, is your mood and motivation affected by the weather?


How much debt are you willing to take on? 

Do you understand how loans work, how much you will need to pay each month for every $5,000 you borrow for school, and how much you would actually end up paying to settle $40,000 in student loans?

How much can you expect to earn in the early years after college based on your projected career? 

What level of student debt would hinder your ability to follow your passions (e.g. to be an entrepreneur) and spend time after graduation traveling the world…what type of four-year experience would be worth the sacrifice?


What does the alumni network look like within your preferred area of study? 

Are the alumni active on campus, as mentors, and do they have a track record of helping students land jobs? 

What will the school offer you 15-years down the road; perhaps when you lose your job or want to change careers? 

Are the professors accessible and experienced in your desired profession? Are they focused on more than just research?


Who are your classmates and what are their ambitions? Will they pull you up or bring you down? 

If you were to become the average of the five people you spend the most time with, what would that look like?

What are the experiences (hiking, eating a certain type of food, watching a certain sports team on TV, listening to live music) that make you happy and will they be available? For my husband it was an accumulation of missing small things that added up to a big dissatisfaction.


How will you fill your free time? 

Can you write down what an ideal week will look like, hour-by-hour, once you’re in college, and is it likely to be the case at each school on your list? 


Okay, I think we will leave it there for this post, but as I close I just want to say that there are no right answers to these questions. It’s all a matter of personal preference and the value can only come from knowing yourself and how you thrive in the world…so DO NOT SKIMP ON THE THE SELF-ANALYSIS AS YOU BEGIN YOUR COLLEGE SEARCH!

Finally, what I want you to take away from this post is that college isn’t a next year thing, a four-year thing, or even a six-year thing. Whether the money comes from your own pocket, a scholarship, a grant, a forgivable loan, or a money tree, it’s a massive investment and you have a right to expect consistent returns over the long term, but only you can determine what type of returns will give your investment true value, and only you can conduct a college search with the greatest possible potential to make those returns happen.

The trick is to determine what is most valuable to you, what is likely to still be valuable to you in the future based on the type of life you can envision for yourself in the future, then to find the school that strikes the right cost/benefit balance.

Alright, that’s all for now. If you liked this post I hope you will share it using the buttons on the left, and if you haven’t already, join the College Consulting HQ Online Community for more articles, tips, tools and strategies!

And remember, you can always use my home page to submit your most pressing college search questions and I’ll be happy to do my best to provide you with my professional opinion.  No sales, no pressure, just answers!

Why Make a Six-Figure Decision Alone?

Sometimes all you need to make a wise college decision is the right piece of guidance at the right time. Which is why I created the YOUR PATH COLLEGE CONSULTING ONLINE COMMUNITY where I share tips, tools and advice, answer your most burning college questions via email, and much more. Join the FREE COMMUNITY to get a closer look at my EIGHT-STEP PROCESS and start dominating your college search TODAY!

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