ARLINGTON HEIGHTS, IL / ACCESSWIRE / April 13, 2022 / The COVID pandemic has triggered a historic increase in college dropouts as students continue to lose faith in the higher education system. Wade Eyerly, the founder of Degree Insurance calls a college degree “the largest uninsured investment you will ever make.”
Watching students lose faith in the American Dream and the promise of a brighter future urged Wade Eyerly to create an insurance product that guarantees the income of graduates 5 years after graduating from college. By providing students a safety net, a university opens the doors for students of all backgrounds to study without worry whether their degree will have been worth it upon graduation.
Numbers like $1.7 trillion in student debt and the 40% of students who start college failing to finish are driving the narrative that college doesn’t work. Not everyone needs to go to college, but once you do you absolutely need to finish. The majority of people who default on their student loans borrowed less than $10,000 but failed to graduate. These are students, and families, that are materially harmed – they’re actually made poorer by having attended college. They qualified for the debt, but didn’t see any return on investment. Getting students into college is one thing, but helping them graduate is more important.
Degree Insurance provides a safety net to graduates, letting them start their lives in a confident position, knowing that they can pay down loans, attend graduate school, or learn a trade in the unlikely event that a college degree doesn’t work for them.
The issue is particularly affecting communities of color, with unemployment rates reaching 15% for Native Americans and Alaska Natives, 13% for Latino Americans, and 17% for African Americans since the last recession. Across the board, however, the unemployment rate of college students only peaked at 5%. As much as a college degree is about increasing your earnings potential, a pivotal but under-discussed role is that it raises the floor of outcomes for a graduate.
Eyerly believes that this product is better at giving students transparency as to what the outcome of their decisions is going to be. The choice of college major is much more impactful than where one studies. Yet parents will spend 18 months helping their child apply to “the best schools,” but often expend little effort helping them into “the best majors.” By understanding the impact of your choices on future earnings, we can unlock the freedom for graduates be more salary seeking, but it also enables students to say, “while I might earn less, I can still support my family, and I’ll be happier” in a more passion-driven route. Degree Insurance works to ensure that achieving a degree is worth it for the regular college graduate.
Eyerly also believes that, “If the university has terrible outcomes then that will show up in the price of the premium.” So, this product also acts as a way to hold universities accountable and ensure they do their part in producing better-equipped graduates to enter the job market.
Ultimately, a college degree is essential to securing a job, with college graduates having a 57% more job opportunities than non-graduates. In fact, a college degree is the single largest buffer against an economic recession. So ensuring it creates a safety net that raises the floor of outcomes for what you can earn.
The upside to not having a degree is limitless, yet the downside is real pain, destitution and financial degradation. A degree prevents a student (and their family) from experiencing the depth of that pain. The aim of Degree Insurance is to prevent more students and their families from ending up poorer than they were before they enrolled in university. “The greatest untapped resource in America is untapped human capital” – and we can tap into it by giving students graduate the confidence necessary to enroll and persist through to graduation.
Eyerly also believes that this insurance product will also play a role in reducing outcomes inequity by guaranteeing students of all ethnicities, and family backgrounds the same guarantee. Any two individuals that graduate from the same institution with the same major will have the same coverage. Raising the floor of outcomes will disproportionately benefit those taking on outsized risk in attending college, often first generation Americans, first generation students, underrepresented minorities and the pell eligible poor.
However, he takes a particular interest in HBCUs because they offer a unique college experience to other colleges. They actively produce more minority graduates and place them in equal roles as their white counterparts. Research shows that HBCUs graduate 40% of all black members of Congress and black engineers, as well as 50% of black lawyers and 80% of black judges. Yet, in the 6 years following the Great Recession, enrolment at HBCUs fell by 11%, meaning that more low-income minority families were already at financial risk.
A survey also shows that 55% of black graduates from HBCUs strongly agreed that their university prepare them well for life after university, with 40% saying that they were doing well financially. While Congress spent more than $10 billion supporting higher education in the wake of the pandemic, Wade estimates that for just $100 million, “we could put a whole generation of African Americans students into the middle class and keep them there.”
In doing so, Degree Insurance addresses the issue of unemployment in America a way that does not disproportionately affect minority communities. This insurance increases college enrollment, improves graduation rates, supports vulnerable communities with guaranteed futures.
Incentivizing college graduation can benefit a generation of students, too many of whom have lost faith in the higher education system. Wade wants to help them realize their futures, by being there to pick them up when they fall.
Degree Insurance provides certainty in an uncertain time.
Company: Degree Insurance
Contact email: [email protected]
SOURCE: Degree Insurance