College Costs: What's Your Return on Investment?
When ranking college choices, ask yourself what your potential Return on Investment would be before 
committing yourself to years of potentially high college costs.
That's the question that Jack Maguire, a former admission dean at Boston College and the founder of Maguire Associates, a higher-ed consulting firm, suggests every family ask when evaluating colleges.
In finance, the ROI ratio measures how effectively a company uses its capital to generate a profit. To measure a family's ROI for a college, Maguire recommends examining a school's freshman retention rate.
Freshman are like canaries kept in a mine shaft. If many freshmen don't survive at a particular college, the school should be eliminated from contention.
"Retention is easily No. 1 on my list," Maguire told me. "Retention to me can really be a measure of the quality of an institution."
It's easy to obtain any college's freshman retention rate. Just visit the federal College Navigator. Type in the name of a college in the College Navigator search box to find it's profile and then click "Retention and Graduation Rates."
The average freshmen retention rate for two- and four-year colleges is 66%, according to an annual survey by the ACT, Inc. Private universities, which have PhD programs, enjoy the highest freshman retention at 81%.
Where Freshmen Are Happy
Here's the student retention rates of eight types of colleges and universities. The designation after the categories signifies the highest degree that each type of school awards.Type of Institution Freshman retention rate
- Public community college 54%
- Private community college 55.5%
- Private college BS/BA 70%
- State college BS/BA 68%
- Private university MA 72%
- State university MA 70%
- Private University PhD 81%
- State university PhD 74%
Retention rate image by //amy//. CC 2.0.