hero image

Attending college has significant benefits that not only include career earnings.  In college, one can get to interact and make friends create networks and can be an invaluable maturity accelerator. Interestingly according to Upstart co-founder CEO Dave Girouard, a college degree can help one secure a loan. Upstart is a technology-based analytics and risk assessment company that helps banks when issuing loans. Girouard says that they offer a modern risk engine working to offer more accurate decisions.

Upstart uses a college degree as a lending metric besides credit score

Girouard indicated that when they started, they were considering indicators beyond the credit score. He says that looking at someone young without credit experience and asking if there was something to supplement what is available credit-wise led to turning to education.

Apparently, a college education was one of the things that could drive the confidence of lenders. As a result, this makes Upstart interesting, especially for those who care about a college education. Although it is somewhat complicated, a college degree can make one be a better candidate to get a loan.

However, when making loan assessments, Upstart considers more than just college education. The CEO indicates that it is nevertheless part of the company’s model, which crunches up to 1,500 data points. Therefore it is easy to note the importance of a college degree to the outcome. Surprisingly it is very predictive.

College education determines what someone earns

Girouard states that what someone studies in college and the college they attended can determine the salary they earn and for how long. There is a significant amount of data on the importance of education, especially considering individuals with higher degrees are less likely to experience unemployment. There have also been historic studies that have shown how valuable education is.

According to a recent report by Georgetown University Centre on Education and Workforce, someone with a degree will earn more than someone with just a high school diploma. The median earnings of a graduate are almost three-quarters of a million over 40 years relative to the cost of the degree.