Over the next week or so, the last of the 3.5 million American high school students will know whether or not they’ve been accepted by the college of their choice. For some, especially those whose families can afford it, college can be a wonderful learning experience in and out of the classroom as well as an important opportunity to mature. And, of course, education is good for society: it strengthens our democracy and creates jobs. We should, however, make sure that the cost does not inappropriately or unduly fall on individuals or their families. For most parents, sending a child off to college is an enormous investment, typically the second largest one they will make after their home. With many well-paying jobs disappearing and middle class salaries flat-lined, families need to take a hard look at whether an expensive college education is worth it.

The cost of a college education has grown dramatically, in many cases consistently above inflation. The approximate total cost per year for a student at the State University of New York is approximately $25,000, while the total annual cost of private college averages about $40,000 and that for the top schools is some $70,000. In private institutions, more than 80% of students are incurring some debt to finance their education; in public universities, that number is over 50%. According to the Institute for College Access and Success, the average amount of student loan debt for members of the Class of 2013 hit $28,400. The total amount of student debt has reached a staggering $1.2 trillion.

Of course, any investment is valuable if the payback is acceptable. And the $40,000+ average starting salaries for college graduates are well known. However, the earnings potential for graduates of top schools with strong academic records is very different than the earnings potential for graduates of lower ranked schools with lesser records. The Federal Reserve Bank of New York, for instance, has found that those who graduate from colleges ranked in the bottom 25% earn no more than the median-income of workers with a high school degree.

Before deciding to send their kids to an expensive private college, a family would do well to calculate the “payback” for such a degree, which simply means the number of years it will take to recoup tuition, room and board. In general, companies expect approximately a five to seven year payback on most capital projects. This is a difficult standard to meet for a college education. My calculations show that a college graduate who earns $40,000 a year and gets raises equal to the inflation rate faces a 10-year payback for a state university degree and a 16- year payback for one from a private institution.

The clear take-away is that a college education is a risky investment. While it is an investment with broader consequences and more subtle considerations than, say, an investment in machinery for a factory, the simple payback calculation above highlights how important it is to consider the financial implications of a college education.

Despite this risk, many parents and students still see a college education as just another expected step and consider a state university inferior to private college. They will not even contemplate a community college, technical program or similar post high school option even though it might make more financial sense. This shortsighted perspective needs to change if the next generation hopes to avoid the crippling student debt that plagues many millennials today.

One idea to improve the situation would be for the federal government to support college graduates by creating a voluntary jobs core. I envision an InfrAmeriTeam program that would allow college graduates to serve for anywhere from two to five years after completion of a college degree. Students would take on non-combat military duty as well as engineering and construction work on infrastructure projects. There would be a minimum grade point average required to participate. Pay, tied to the average starting salary for U.S. college graduates, would be increased 20% for a grade point average above a certain standard and decreased 20% for a grade point average below a benchmark. I suspect that the InfrAmeriTeam would more than pay for itself given the many long neglected public works projects in our country.

The so-called American Dream has been traced to our country’s founding and the idea that every person has the freedom and opportunity to pursue and lead a better life. A college education is usually thought to be a critical step on the way to the American Dream. What is often left unsaid is that the pursuit of any significant good without a careful evaluation of its affordability and payback can result in damaging financial consequences. The purchase of a college education is no exception.

Jonathan F. Foster, an investment banker, private equity investor and corporate director, is a managing director at Current Capital LLC, a New York City private equity investing and management services firm.

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