As the national student debt burden rises to about $1.3 trillion, many families are doing whatever they can to pay off the increasing costs of a college degree. Now Babson College, outside of Boston, is joining in the savings creativity. The business degree-only school announced today (April 26) that, starting this fall, students may earn an undergraduate degree in as little as three years.
According to a release from the school, students “without pre-college credits” may finish their degrees a semester early. For students entering with at least 16 Advanced Placement (AP) credits, graduating in as little as three years is an option.
“A Babson education prepares entrepreneurial leaders to make a profound difference in our rapidly changing world,” Babson College President Kerry Healey said in the release from the school. “We are proud that it also delivers an exceptional return on investment for our students and their families.”
A YEAR LESS TUITION, A YEAR MORE SALARY = BIG BENEFIT
Using its current average salary at graduation of $56,267 and current tuition price tag of $49,664, Babson predicts that cutting a year off tuition will equate to a financial benefit to each student of around $105,931.
“A Babson College education is a wise investment, and creating value through innovation is our priority,” Ian Lapp, dean of the undergraduate school at Babson College, also said in the news release.
“We are committed to partnering with our students to customize an affordable and transformative learning experience that adds value to their personal and professional goals,” Lapp said, “whether that means accelerating their degree path or working together to make the most out of their four years at Babson.”
INTERNAL RESEARCH SAYS ABOUT 25% OF CURRENT BABSON STUDENTS COULD ALREADY GRADUATE EARLY
Many schools have accelerated programs that get students through a bachelor’s and master’s degree in a shorter amount of time, and of course students can try to speed through a bachelor’s degree program faster than four years. But Babson is the first elite business school to design a program to do just that.
Healey says the genesis of the program stemmed from when she and some other Babson administrators began noticing about half of their “top scholarship” students had “self-engineered” their own accelerated paths to graduation. Many of the students were graduating in three and a half years, and a few were even finishing after their junior year.
So Healey and team decided to investigate. Through internal research, Healey tells Poets&Quants, they learned that about 25% of their current students could graduate earlier than the traditional four years. Many were entering Babson with large amounts of AP or international baccalaureate (IB) credits. Others were just in a hurry to graduate, loading up on five courses each semester instead of the traditional four most Babson students take.
But why were so many students busting through their undergraduate experiences?
“What we discovered was that the motivations were very diverse,” Healey says. “In many cases it had something to do with wanting affordability. Students were able to cut their college costs by as much as 25% by ending a year early, and 12.5%, which is not insignificant, by ending a semester early. Some were very anxious to go back to their family businesses. Others were anxious to launch their own ventures and were looking forward to participating in incubators here on campus or elsewhere. And others were just anxious to get into the workforce and start going.”
EMPLOYERS ALREADY APPROVE OF EARLY GRADUATES
Healey’s office wanted to know what top employers thought of hiring students that graduated early.
“They were 100% in favor of hiring smart students who were in a hurry,” Healey says of the findings of a survey sent to the school’s most popular employers.
However, she isn’t sure a similar program would work at a larger university.
“I think at many colleges, the question is, can we get our students to graduate in six years? I’m more concerned with, Can I retain them for three or three-and-a-half years?” she says, noting the types of students coming to Babson are often very value-oriented.
BABSON REMAINS A GOOD BET ON LONG-TERM ROI
Healey notes that other approaches to reducing tuition debt burden — like lowering tuition increases or tuition freezes — exist “around the margins” of the problem. But knocking off an entire year of tuition is a more direct approach to solving the problem. According to Poets&Quants‘ survey of the top 50 undergraduate business programs, elite business students are leaving their schools with anywhere from just under $4,000 in student debt burden to up to $34,000. However, according to Payscale research, Babson College has one of the highest four-year tuition costs — about $238,000 — of business schools providing sizable returns on investment.
Still, according to the same Payscale research, only seven other business schools have a better 20-year return on investment than Babson’s $756,000.
“We have always cared a lot about return on investment,” Healey says, noting Babson has been recognized for their four-year value by rating agencies. “This is just another step forward for creating value for our graduates.”