Choosing the right college involves more than finding the most competitive sports teams. Today's students need to know if the programs they are interested in are accredited, offer federally-backed and other financial aid, provide a good return on the tuition invested, and work hard to get, keep and graduate their students.
OEDb has been using its proprietary methodology to rank accredited online colleges. The following are some of the most important indicators of success OEDb has found; top schools focus on these fundamentals because their administrators and teachers know that the best students will only attend programs that provide both a great education and sufficient support to help start a successful career.
Top institutions seek accreditation from outside organizations to demonstrate that their programs and schools meet the highest expectations for quality. Although the U.S. Department of Education (DOE) plays a role, the accreditation process is managed by nonprofit, non-governmental organizations that evaluate programs and institutions either nationally or regionally.
Entire institutions are accredited by organizations like the Accrediting Commission of Career Schools and Colleges and the New England Association of Schools and Colleges, Commission on Institutions of Higher Education. Particular fields of study have specialized accreditors such as the National Council for Accreditation of Teacher Education and the Accrediting Bureau of Health Education Schools.
Regional accreditors work in certain geographic areas, conducting comprehensive reviews of institutions and programs within their jurisdictions; the seven organizations include the Middle States Association of Colleges and Schools Middle States Commission on Higher Education, North Central Association of Colleges and Schools The Higher Learning Commission, the Western Association of Schools and Colleges Accrediting Commission for Community and Junior Colleges and the Southern Association of Colleges and Schools commission on Colleges.
National accreditors typically accredit an entire institution and are either faith-related or career related. The former include the Association for Biblical Higher Education Commission on Accreditation, The Association of Theological Schools in the United States and Canada Commission on Accrediting and the Association of Advanced Rabbinical and Talmudic Schools Accreditation Commission. Career-related national accreditors include the Accrediting Council for Independent Colleges and Schools, the Council on Occupational Education and the National Accrediting Commission of Career Arts and Sciences, Inc.
With the wide array of accrediting data easily available on the web, today's students are increasingly turning to this information as the first step when choosing a college. Accreditors identify a wide variety of potential problems with an institution or program, such as when the University of Virginia failed to meet core accreditation requirements for faculty participation in governance. Knowing that accreditation by a reputable agency ensures that a program or school provides a quality education, these students rely on accreditation data when determining if the tuition cost will produce a sufficient return.
One of the main criteria for obtaining accreditation is financial responsibility. Schools with poor finances are rejected by accreditors and prohibited from participating in federal and state financial aid programs (see below). A recent example is Lon Morris College, which lost its accreditation and ability to offer financial aid, after it declared bankruptcy in 2012.
Many constituencies consider accreditation when evaluating the quality of an individual's education. In addition to graduate programs, many institutions require courses be taken at an accredited institution in order to grant transfer credit. Furthermore, many employers look up their job applicant's schools and programs, on databases such as that provided by the U.S. Department of Education. These employers believe that accreditation ensures that a program or institution covers the fundamentals of their field and ensures that all graduates have obtained certain basic levels of education and training.
Accreditors, themselves, are also evaluated. In addition to the DOE, other organizations, such as the Council for Higher Education Accreditation (CHEA), establish rigorous standards relating to advancing academic quality, accountability, fair procedures and continuous improvement, that are met by the best accrediting agencies.
With the rise of private, for-profit colleges, some of which have dubious quality, has come a spate of non-approved accreditors. Students are cautioned to make sure that the programs they are interested in are accredited by approved accreditors. To help with this effort, several states have established guidelines for determining if an accreditor is simply an accreditation mill or the real deal.
Internationally, other countries are similarly concerned with ensuring the quality of their institutions of higher education. The United Nations Educational, Scientific and Cultural Organization (UNESCO) provides information on the quality assurance and status of colleges and universities, by country.
For most students, college would not be affordable without financial aid. In fact, the most recent data indicates that two-thirds of all undergraduates receive some sort of federal, state or private financial assistance. Determining what aid is available at prospective colleges is one of the first tasks that must be completed when choosing a school.
Since 1965, the federal government has been providing financial aid to low and middle income students to increase their opportunities to attend and graduate from college. Over the years, it is estimated that Uncle Sam has invested over $150 billion in student aid.
Despite the wide array of aid available, many potential college students fail to seek it, obtain it, or get it as soon as they should. In a 2008 report by the Institute for College Access & Success, it was found that many low income and minority high school students and their parents overestimated the cost of attending college; in fact, these students and parents thought that the cost of two-year colleges was 300% higher, and four-year 200% higher, than their actual tuitions.
The report also found that parents and students often are unaware of common sources of financial aid; for example, about 60% of the parents, and 65% of college-bound students, did not consider grants or scholarships when discussing financial aid. These numbers are higher for minority families, where 75% of African-American and over 80% of Latino parents do not identify scholarships or grants as potential income sources. This is unfortunate, since many merit-based grants and scholarships are overlooked by innovative students, including the Robert C. Byrd Honors Scholarship Program.
Overall, students have misconceptions about financial aid eligibility. Those from two-parent households often erroneously assume they will not qualify, and those without top grades also think this is a requirement, even for loans.
The best schools are aware of this information gap, and help their students identify sources of financial aid, and obtain it. Since it is well known that 85% of high school seniors learn about financial aid from their high school counselors, the top colleges make their financial aid data widely available, particularly via the internet.
These schools have easy-to-navigate sites with eligibility and application information for a wide range of scholarships, grants and loans, including state and private financial aid, as well as the Free Application for Federal Student Aid (FAFSA). Knowing that many students require financial help to attend and succeed at their school, the best universities provide assistance with determining eligibility and completing applications, as well. By working aggressively to inform students of the opportunities for paying for and attending their school, the best colleges ensure a diverse and dynamic student body.
Getting financial aid is only half the battle, and the best schools realize this. Sadly, despite the significant investment in time and money, almost one-third of all students who take out financial aid actually graduate with a degree. To fight this, the best schools have begun initiatives such as guarantee programs, where the university commits to matriculating the student within four years.
Despite the risk associated with taking out financial aid debt, the data is clear that a college education pays for itself. In a recent report from Georgetown University's Center on Education and the Workforce, it was found that during the recent Great Recession, the unemployment rate for recent four-year college graduates was high, at 6.8 percent, but that the unemployment rate for recent high-school graduates during that same period was a whopping 24 percent! Clearly, college financial aid is an investment in the future, and not just a risky loan.
One thing savvy students should remember when using financial aid as a factor in deciding which school to choose – the "more expensive and prestigious the school, the more likely it is well-endowed and can meet 100% of need." Perhaps counterintuitive, this situation typically exists because of the higher tuition paid by wealthier students, and increased donations by well-heeled alums. Therefore, top students with high GPAs and SATs should carefully compare the financial aid offered between prestigious and less expensive colleges; they may just find that the school with higher tuition will be more affordable for them.
Return on Investment (ROI)
Another important factor to consider when choosing a school is whether the income earned as a result of the college degree is worth the tuition paid in getting it. Known as return on investment (ROI), savvy college bound students consider this heavily when choosing a school and a program.
With a little internet research, students can find ROI already calculated for most of the best schools. For example, a typical student who's considering attending Harvard for their undergraduate degree can expect to pay around $210,000 in tuition, obtain just over $34,000 in financial aid and have a thirty-year ROI of about $1,253,000 (or 14.5% annual ROI). On the other hand, that same student who chose to attend Drexel University would spend nearly $222,000 in tuition, would receive almost $15,000 in financial aid, and have a thirty-year ROI of nearly $539,000 (or 9% annual ROI). Clearly, higher tuition does not demonstrate a better school – or a better investment.
Students interested in shorter term ROI avail themselves of calculators, like that provided by the Wall Street Journal. Students input the type of school, anticipated career and anticipated aid, and the calculator outputs median salary (in year one and year five), the initial return on investment and the return after five years.
So what variables are included in a ROI equation? One of the most common methods for bachelor's degrees considers type of institution, graduation rates, duration of education (i.e., graduate in four, five or six years), average amount of financial aid that comes as grants, the total cost of the education (fees, room and board, as well as books and tuition), median pay and compensation.
Regardless of whether the ROI is 15 percent or nine, today's top students know that a four-year bachelor's degree is worth the money. In the report The College Advantage: Weathering the Economic Storm, the data clearly demonstrated that since the Great Recession (December 2007 through January 2010), the only group that suffered essentially no job losses were those people with a four-year college degree or higher. In fact, from January 2010 (the beginning of the recovery), people with bachelor's degrees (or higher) gained two million jobs. Conversely, people with some college or an associate's degree lost 1.75 million jobs during the recession (although most of them, 1.6 million, have been regained in the recovery). Worse still, those with no college lost 5.6 million jobs as a result of the Great Recession, and those jobs have not been recovered.
Realizing they need a degree, many students incorporate information on how their prospective schools spend tuition dollars into their ROI. Some colleges, particularly the newer, student-centered online schools, spend a great deal of resources on student retention, graduation and job placement. These flexible new programs prefer to spend money opening up new sections of a class, rather than turn students away because a class is full. Some of the better programs also use an "early alert" system to identify struggling students and put them in touch with academic and financial counselors to help address concerns. Difficult to quantify, the amount of resources a school is willing to reinvest in their students is a valuable factor in figuring ROI.
One of the most important factors in the return on tuition investment is job placement. Many do not realize that the best job placement efforts begin when the student starts college and chooses a major. The best programs offer good academic guidance that steers students into fields where jobs are plentiful.
In a recent study, the Center of Education and the Workforce found that even recent graduates in the highly employable education and health fields had relatively low unemployment rates (around 5.4%) while those in the arts, architecture and the humanities suffered from high rates of unemployment (above 9%). The study further found that as graduates in the highly-desired fields gained experience, their unemployment rates fell by half, while those in the arts continued to suffer from high rates of unemployment. Clearly, job placement rate is an important factor in ROI.
Another less well-known variable that should be incorporated into ROI is the student loan default rate. Simply put, it is the percentage of a school's borrowers who are supposed to be repaying their student loans – but are not. The DOE has a default rate database that easily allows students to identify all schools in a given locale, or by institution, program type or eligibility status. This important tool allows students to see, at a glance, if taking out student loans at an institution is a good investment or a poor choice.
Of primary concern to all students, student retention rates measure how well a particular college or program helps its students stay in school. More complicated than just ensuring attendance in class, a good student retention effort will include academic counseling and support and financial aid. The best schools focus on retaining their students from the moment they are accepted into the program.
Historically, nearly 30% of freshmen leave college in their first year of study. For the past 40 years, it has been well accepted that the high rate of loss, known as attrition, can be greatly reduced by building strong relationships between the student and their faculty, staff and administrators. Over this time, the best schools encouraged (and demanded) that faculty be available outside of the classrooms, use a variety of teaching methods and encourage communal studying and activities. These schools also develop thorough and engaging academic counseling and extracurricular programs.
The metrics of retention are complicated and typically require evaluating acceptance, retention and graduation rates. Off the cuff, most people think that schools with lower acceptance rates are better schools, and so are able to pick and choose the best students to attend their programs; and for some specialized programs, like Julliard School of Music, this is probably true. However, since acceptance rates for nearly all programs are declining, at least in part due to the fact that unprecedented numbers of high school graduates are applying for programs, the statistics can be deceiving. Retention, as demonstrated above, is still a better indicator of a good school than acceptance rates.
That said, retention rates are no more important than graduation rates. As noted earlier, the return on tuition investment is zilch if the student does not get a good job out of it; realizing this, when parents and students are presented with graduation data, they typically factor that into their choice of school.
A recent report by Complete College America noted that 75% of today's college students either have a family, work or commute to class. To meet the needs of today's students, the best programs are incorporating recommendations designed to help non-traditional schedules, including shorter academic terms, year-round classes, simplified registration, reduced classroom time, peer networks and reduced superfluous classes and credits.
Understanding the importance of incorporating these and other changes into higher education, the Bill & Melinda Gates Foundation is investing nearly $35 million into community colleges to help them implement the new approaches necessary to help students earn degrees. Taking another track, a recent commission in Ohio has recommended that tax money allocated for higher education be divvied up among the colleges by graduation rates, rather than simply enrollment.
Nonetheless, students should be careful not to place too much importance on graduation rates either. As with all statistics, rates can be skewed depending on who gathers the data and how it's presented. For example, the Integrated Postsecondary Education Data System (IPEDS), which is the set of surveys used by the DOE in determining graduation rates, ignores part-time students, transfer students and returning students – three groups that comprise nearly 40% of all of today's college students.
Clearly, although important numbers, retention, attendance and graduation rates are not the only indicators of a high quality program.
With so much data available on the internet, diligent students can thoroughly research the colleges and programs they are interested in and make a truly informed decision. By combining hard data like retention, graduation and job placement rates, accreditation status and financial aid with softer information such as the school's commitment to non-traditional students, today's students get a clear picture of what that college's experience can be for them. Students and parents alike are encouraged to scrutinize their chosen schools and programs when making the investment in higher education.