What if your family has money for you to attend college but instead of paying for school they invest it in the S&P? You'd be surprised by the returns we uncover in this episode.

In this episode:

• The perspective of saving the family money [1:00]

• Investments as an option instead of going to school have an average return rate of 9.8% in the S&P [2:00]

• What if you just invested that 120K into the market instead of sending your kid to school?  [2:00]

• 2.9 Milllion after taxes when they are 65 instead of paying for school right now with family money [5:00]

• Lifetime additional 600K of earnings w/college also means the kid has to work whereas the 2.9 is free. [8:00]

• 420K additional earnings after taxes - math of lifetime earnings does not equate to what you’d get back if you invested it right now [11:30]

• Wealth left on the table to hire more administrators, facilities etc. Universities need to correct this [12:00]

• Math is upside down against the students based on the social security admin and Pew research [13:00]

• Once again, the school you went to doesn’t really matter. [16:30]

• Increases in tuition and room and board has created this flip flop on return on investment [22:00]

• House example - you will pay more when buying a home when someone else has renovated it and its move in ready. 

• Similar to investing 150K in house for a 50K return. Why spend more on education than your house? [24:00]

• Is your kid able to earn 3 million in a lifetime? Is it worth it? [27:00]

• In order for the math to work, for the additional earning power of 655K, college needs to cost between 25 and 30K [28:30]

Resources:

Michael Santoli, CNBC.com The S&P Has Already Met Its Average Return for a Full Year, But Don’t Expect it to Stay Here