A common misconception that pervades the minds of many is that a college education, regardless of school, is one and the same – that attending one school versus another makes absolutely no difference, and that you are better off going to a community college and walking out with minimal debt. I can not stress to you enough how and erroneous that assertion can be.
Education is one thing you should never deny your child. It’s a tool that will enable your student to reach his or her goals and aspirations in life, and thus is definitely not something to be considered a mere waste of money. Yes, there are instances in history where a self-made entrepreneur or icon graduated from a no-name college and became successful. Yes, some parents may not have a college education at all, and have done exceptionally well for themselves through hard work and intelligence. Even so, times have changed. There are exceptions to every rule, and I’m not saying that if your child doesn’t attend Harvard, Yale, Princeton, Wharton, Stanford, U.C. Berkeley or another great school, that he/she will never amount to anything. However, the road to success will be infinitely easier if one ignores the cost of school and simply attends the best university one is accepted to.
This does not mean that parents should pay out-of-pocket for the full cost of their child’s education, or that they should assume all the burden of paying off their child’s loans. This means that parents should always encourage their children to dream big and take advantage of every opportunity given to them. By attending a top-ranked school for their major, students will have the ability to network with some of the greatest minds and business leaders of the future and conduct research with award-winning professors. As a note to students: depending on your major, this means taking out loans to invest in yourself and your future. Although repayment of student loan debt can seem like a looming cloud of doom, the benefits that follow your graduation from a top university far exceeds the debt you incur.
Statistics and Facts
There have been 43 different Presidents of the United States of America (fun little fact: President Grover Cleveland served as both the 22nd and the 24th President). Of the 43, Barack Obama became the 8th U.S. President who graduated from Harvard, and five other Presidents graduated from Yale University, resulting in two of the top universities producing approximately 30% of the U.S. Presidents. I’m sure you are thinking this has to be a coincidence, right?
- Every single current Supreme Court Justice has graduated from Harvard Law School, Stanford, Yale, or Princeton, either for an undergraduate degree and/or law school
- Yale – Briton Hadden, co-founder of Time magazine; Brewster Jennings, the founder of Standard Oil of New York (Exxon Mobil); and Harold Stanley, the founder of Morgan Stanley
- Harvard – Bill Gates, co-founder of Microsoft (drop out); Mark Zuckerberg, co-founder of Facebook (drop out)
- Princeton– Jeff Bezos, the founder of Amazon; John C. Bogle, the founder and former CEO of The Vanguard Group
- Stanford – Larry Page, PhD and Sergey Brin, PhD, co-founders of Google
- Current or former CEO’s from Harvard – Steve Ballmer, Microsoft; Jeff Kindler, Pfizer; James McNerney, Boeing; Sumner Redstone, Viacom; Meg Whitman, Hewlett-Packard and eBay (also attended Princeton); Eric Schmidt, Google; and Stephen A. Schwarzman, Blackstone Group.
And this list just names a few of the more prominent business figures.
Lastly, let’s hit a little closer to home with investment banks and private equity groups, the juggernauts of the finance world. Having worked in the private equity industry for 2 years myself, I can tell you first hand the number of Harvard, Stanford, and Wharton MBA’s that hold upper management positions at major PE groups and investment banks, such as the Blackstone Group, KKR, Goldman Sachs, JP Morgan, TPG, etc., is a substantial amount. The same goes for the most prestigious law, accounting, and consulting firms. Attending a top-tiered school for your major provides an advantage when trying to get an interview.
Hopefully by now, we’re on the same page. So why does this happen? Why do the top-ranked schools dominate the highest echelons of our society and economy? Isn’t the education at one school comparable to another? After all, the information professors present to students is universally the same. The laws of physics, chemistry, computer science or finance do not change (at least I’d hope not) from one university to another.
It’s great to be part of an inner circle; to walk into a room and immediately have a connection with someone else, one that allows you to comfortably bond over a common experience or hobby. It’s just human nature to prefer the known over the unknown, and naturally, we want to work with and help others we feel can offer the same caliber of excellence as us. And since most alumni have a certain pride regarding their alma mater, graduating from the same university (with a decent GPA) indirectly suggests that you have some of the same abilities and skills they do.
It’s never happened to me, unfortunately, but I’ve heard many stories from my college peers who walked into accounting, investment banking, and financial analyst interviews expecting to be grilled on accounting and valuation fundamentals, only to end up having discussions about old professors, college football or basketball games, their experience at the university, and the inside track on how to impress the managers and directors to get hired.
Top-tier schools have the most well-connected, powerful, successful and rich alumni networks. Where do you think these schools get their donations for their endowment funds? If you are a graduate of one of the top 50 schools in America, you will find it much easier to land a job interview or even the position itself because brand names and a school’s reputation matters.
Endowment Funds (2011 Figures)
- Harvard, $31.73 Billion, Ranked 1st
- Yale, $19.37 Billion, Ranked 2nd
- Princeton, $17.11 Billion, Ranked 4th
- Stanford, $16.50 Billion, Ranked 5th
- MIT, $9.71 Billion, Ranked 6th
For a full list of college and university endowments, check out Wikipedia.
The Benefits of Well-Respected, Award-Winning Professors
We’ve all experienced professors or teachers who have tried to explain a concept but leave us more lost than we previously were; however, it is truly rare that we encounter an individual who inspires us with the simplicity in which he/she helps us understand complex ideas. Or the professor will speak with such zeal about his/her subject that you will begin to consider the infinite possibilities of a career in the field.
It’s called positive reinforcement – we all like to take part in activities that we enjoy or could do well in, and if you feel particularly knowledgeable or intelligent in a given subject, you are likely to pursue it more passionately. That passion and enthusiasm will eventually manifest itself to your professor and others. When research opportunities, internships, or job positions present themselves, you will have a strong supporter or mentor who can pull strings for you or recommend you to recruiters, interviewers, and companies. In addition to becoming student mentors or providing recommendations, professors also bring prestige, grant money, and research work to universities and students.
For Your Student’s Future
All in all, America won’t always be in a recession and money will not always be this tight. I understand that things are tough now and families may be experiencing financial hardships, but when the economy is booming in 4 years, will your child/student be best-positioned to succeed in the job market? Life is a marathon – don’t let your short-term troubles cripple your children for a lifetime.
Stay Tuned: my follow-up post will address financial aid, how my sister and I got $100,000+, four-year educations, and came out with only $15,000 in loans.
*Please note that, though I did not mention this, I do encourage certain students to start at a community college and then transfer to a university. If this is what you feel is best for your child, make a plan and execute it. It’s all about the name of the university on your diploma.
*As you may have noticed at the very beginning of my post, I tried to highlight that this decision is somewhat dependent on the student’s major, the competitiveness of the industry and the potential salary. For example, a top-ranked university makes a big difference in the legal or finance industries, where being employed by a prestigious firm results in a six-figure income right out of school. However, a career as a teacher or in human resources will not likely be affected much.
*I did not attend any of the universities mentioned in this article.