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Is university worth the cost?

Many people have been pushed to further their education without question, but is university really worth the cost?
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Reading time: 4 mins

Whether you’re looking to make your own way in the world, thinking about furthering your career prospects or changing your career entirely, then university might be one option you’re looking at. But is university really worth the cost? The answer to that is quite complex, for example, some jobs like medicine, dentistry and engineering will require a degree, but other jobs can be earned by experience.

Is university right for you?

The first thing you might want to look at is whether university is the right option for you. Do you know what kind of job you want to have? Have you checked to see whether a degree is essential, or can you work your way up the ladder? What kind of pay would you likely be looking at when you come out of university? All of these things can help you find the answer to that question, but only you are able to decide if it’s the right option for you.

How much does university cost?

We’ve detailed the real cost of university in another blog, but the long and short of it is that a three-year Bachelor’s degree could cost you £27,750 just in tuition fees.[1] If you’re looking at moving away, then your living costs are also likely to increase, meaning that it may be even more expensive to go to university.

However, student loans can help you pay for this and they aren’t considered to be a ‘bad’ form of debt. In fact, how much you’ll repay (including the amount of interest you’ll repay) depends on what you earn – you can find out more about how much you may need to repay on the government’s website: https://www.gov.uk/repaying-your-student-loan/what-you-pay

Is university value for money?

Value for money depends on who you’re talking to, as it’s always believed that going to university is an investment in your future allowing you to be a higher earner further down the line. And before you look at average salaries to plan your future, it’s worth thinking about it a bit tactically. For example, if the average lawyer salary in the UK is £48,304 a year[2], but if some lawyers are earning £100k+, how many other layers are earning less than £30,000 a year to bring this average down?

That’s not to say that going to university won’t land you a bigger paycheque. One study found that graduates born in 1990 with a first or 2:1 earned 14% more than non-graduates at age 26, however those with a 2:2 or a third only earned 3% more.[3] In this study, we can see it’s not just about going to university, it’s about how well you do there. However, the same researchers have previously found that this increased salary, which they called a ‘graduate premium’ has been reduced over time – in fact, the 1990 graduates’ premium was significantly less than the 1970s graduates, who enjoyed 20% greater earnings.[3]

But this is a blanket statement, and there’s a whole heap of other factors that also apply here. For example, you also need to consider the type of degree, the demand and popularity of the subject, the number of jobs in that field, how commercial or competitive the market is, and even the candidates themselves with their backgrounds, and locations around the UK.

In fact, data from the Office of National Statistics suggests that there are more than four million graduates in the UK who are employed in non-graduate roles.[4] This just highlights the fact that a graduate role out of university isn’t guaranteed, and many people with degrees end up working jobs that they don’t need a degree for.

What about studying abroad?

If it’s the cost of going to university that’s putting you off, then you may have thought about studying abroad. There are several universities in Europe that offer free or significantly lower tuition fees than British universities. For example, you could attend a German university for free – the only catch is that you may need to get a residence permit before arriving, the course you want to do may not be in English, and you’ll need to finish your studies while in Germany.[5]

Not all European universities are cheaper than UK ones, however, and going to college in the United States can often be more expensive. But that doesn’t mean your options are limited - according to Times Higher Education, you could study in Italy, France, Belgium, Finland, Spain, Austria, and Norway for cheaper than you can in the UK.[6]

What are your other alternatives?

University isn’t for everyone, and there are plenty of other ways you can secure a good, high-paying job without needing to spend thousands on your education. For example, you could attend Open University and study while you work, or you could become an apprentice to a trade. In 2015, the UK government launched ‘degree apprenticeships’ which are a three or four year could that pay you as you learn and gain experience – plus, these courses are paid for by your employer and the government, meaning that you probably won’t have to pay a penny towards it.

Another option could be saving in advance, reducing the need to take out a loan or student finance. If you’re a parent, it could be worth setting up a Junior ISA for your child to help them pay towards their higher education, and the earlier you start saving the easier it could potentially be. Say, for example, you opened a Junior Stocks and Shares ISA when they were born and each month you put £100 into it for their future, then by the time they were 18, they could have £29,793 to help cover the cost of university. [7]



  1. https://www.ucas.com/finance/undergraduate-tuition-fees-and-student-loans
  2. https://www.reed.co.uk/average-salary/average-lawyer-salary
  3. https://www.hesa.ac.uk/news/10-03-2020/return-to-degree-by-class
  4. https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/adhocs/12501employedgraduatesinnongraduaterolespartsoftheuk2015to2019
  5. https://www.study.eu/article/study-in-germany-for-free-what-you-need-to-know
  6. https://www.timeshighereducation.com/student/news/best-universities-europe-2016-where-can-you-get-value-money
  1. This is the projected value for a Confident Plan (Medium Risk Plan). This is only a forecast and is not a reliable indicator of future performance. If markets perform worse, your return could be £23,306. If markets perform better, your return could be £38,232. Values correct as of 18/12/2020

With investing, your capital is at risk, so the value of your investments can go down as well as up, which means you could get back less than you initially invested.

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