CaliToday (18/11/2025): As tuition skyrockets and the student debt crisis dominates headlines, many Americans are asking a tough, existential question: Is a college degree even worth it anymore?
A new study from the Center for Social Development (CSD) at Washington University in St. Louis's Brown School provides a resounding "yes."
The research confirms that completing a college degree still provides an enormous financial benefit, even when factoring in the significant burden of student loan repayments. The findings directly counter the growing national anxiety that escalating costs and high debt loads have made a college education a bad investment.
The $8,000 "Completion Premium"
The report, published on SSRN, drills down on the most crucial factor: completion.
It found that degree-holders earn, on average, $8,000 more per year than individuals who attended college but dropped out even after subtracting their student loan payments.
If debt payments are not factored in, that income gap widens to $10,400 per year.
"Our data shows that higher education is still a worthwhile investment," said Professor Jason Jabbari, the study's co-author. He affirmed the findings underscore the critical importance of supporting students not just to enroll, but to finish their programs.
Even students who completed short-term professional certificates saw a significant boost, recording debt-adjusted incomes $5,000 higher than those who failed to complete the same programs.
A "Debt-Adjusted Income" Metric
To get the most accurate picture to date, the research team developed a novel method. They linked data from a national credit bureau with records from the National Student Clearinghouse, allowing them to track real-world financial outcomes.
Unlike traditional analyses, they created a "debt-adjusted income" metric. This innovative index provides a far more realistic snapshot of a graduate's long-term financial well-being by directly accounting for the impact of their repayment obligations.
The results showed that while debt does reduce the short-term returns, the long-term benefits remain substantial. The study broke down the debt burden relative to the extra income gained from the degree:
Associate's Degree: Holders spend approximately 9% of their increased earnings on debt repayment.
Bachelor's Degree: Holders spend approximately 19% of their increased earnings on debt.
Master's Degree: Holders spend a significantly higher 57%. However, the study notes that the rapid income growth associated with graduate degrees helps narrow this gap over time.
A Warning Against "Restricting Access"
The research team's key message is that higher education delivers real, tangible returns. But they also issued a stark warning that pending federal policy changes could threaten this proven pathway to financial mobility.
The report specifically cites the proposed "One Big Beautiful Bill Act," which could limit opportunities for higher education. This act is expected to:
Impose new loan caps for graduate students.
Expand "gainful employment" regulations, a move that could cause some programs to lose their eligibility for federal financial aid.
The researchers argue these restrictions are misguided. They stress that their data shows the vast majority of graduates already meet or exceed these federal standards.
The study concludes that policy should focus on expanding not shrinking financial access to education, especially for the students who stand to benefit most from completion. The authors also propose expanding student loan programs to cover non-SAR (Student Aid Report) eligible professional certificates, further opening doors for career advancement.