A Flaw in Our College Costs vs. Income Calculator?
Paul Solman frequently answers questions from the NewsHour audience on business and economic news on his Making Sen$e page. Here is Wednesday’s query:
Name: Carol Christen
Question: Paul, the calculator is great. But it has a serious flaw. Few minimum wage jobs offer 40 hours a week. Even the average work week is only 34.5 hours, and minimum wage jobs often far less: 20-to-32-hour work weeks. For better budgeting, the calculator should be able to adjust to the hours a student usually works per week or per month.
Paul Solman: The calculator is the baby of Making Sen$e web producer Elizabeth Shell, so she will answer your question, Carol.
The calculator which accompanied our series on student loan debt does allow users to adjust the average number of hours worked for both the summer and the school year — the ’20’ and ’40’ are average defaults we went with, and can be changed, say to ’10’ and ’35,’ respectively. Or whatever you wish. (Hit enter on your keyboard to see the change.)
>However, there were lots of assumptions we had to make when creating the calculator, as well as various factors that we had to leave out. Why? Because if we included every possible input and scenario, the calculator would have had too many options. And then no one would use it.
For example, we did not include food, books, transportation or other costs of living. These vary wildly from person to person and place to place, and there are no hard and fast, longitudinal cost-of-living data, at least that we know of.
We also did not include taxes as, again, individual variation would be too great to capture and we decided against an IRS 1040 approach.
What we were going for was a plausible comparison over time.
This entry is cross-posted on the Making Sen$e page, where correspondent Paul Solman answers your economic and business questions