Quick summary
When you're comparing colleges, you'll run into a lot of numbers: graduation rates, median earnings, loan default rates, student-to-faculty ratios. These data points matter, but they're not the whole story. Each one tells you something real about how students fare after college—but only if you know what it's actually measuring and what it leaves out.
This guide walks you through the main data sources colleges use to show their value: what each number means, where it comes from, and how to use it without over-relying on it. You'll learn that two schools with nearly identical graduation rates can have wildly different student outcomes, and earnings data tells you about past graduates but not necessarily what you'll earn.
The goal here isn't to make these numbers disappear from your decision—it's to help you read them like an insider.
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The main numbers and where they come from
Graduation rates: What "150% of normal time" actually means
When you see a college's graduation rate, you're usually looking at the 6-year graduation rate for 4-year institutions. This number comes from IPEDS (Integrated Postsecondary Education Data System), which is run by the National Center for Education Statistics. IPEDS tracks the percentage of first-time, full-time students who earn a degree from the same institution within 150% of the normal time for completion—that's six years for a bachelor's degree.
Here's the thing: this number only counts students who finish at the school where they started. If a student transfers and finishes elsewhere, they don't show up in that graduation rate. The data also focuses on full-time students who entered as freshmen, which means part-time or older adult learners aren't reflected in the number.
As of 2020, the overall 6-year graduation rate for bachelor's-seeking students at 4-year institutions was 64%. But this varies sharply by school type: public institutions averaged 63%, private nonprofits 68%, and for-profit institutions just 29%.
The U.S. Department of Education's College Scorecard provides these rates for every institution, broken down by state, institution type, and even by demographic group so you can see if certain students have a harder time finishing.
What you're not seeing: retention rates and the first-year cliff
Before graduation rates come retention rates. The first-year retention rate tells you what percentage of freshmen return for their second year—and it's a useful early warning signal. If only 65% of students return for year two, that tells you something about how well the school supports its students from day one.
Recent data shows that first-year retention has improved: more than 86% of students from the fall 2023 cohort returned for their second semester, and 83.7% completed spring semester. But retention varies significantly by student background. As of recent reports, institutions retain Hispanic students at 63.6%, Black students at 56.6%, and Native American students at 52.8%—well below the national average of 68.2%.
Retention is harder to get reported clearly for individual schools, but you can find it through IPEDS or by asking the admissions office directly. Schools that are honest about retention challenges are usually working on them.
Earnings data: Where the money comes from
The College Scorecard now reports median earnings at 1 year, 5 years, and 10 years after graduation. These numbers come from a remarkable source: the U.S. Department of the Treasury matches student financial aid records with tax records, so the earnings are real W2 and self-employment income, not surveys or guesses.
This is powerful. The data captures actual earnings from federal tax returns, which means very little measurement error. A college can report that its graduates earn $50,000 five years out, and that's based on real income reported to the IRS.
But there's a crucial catch: the earnings data only includes students who received federal financial aid. If a college has many wealthy students who paid out of pocket, their earnings won't show up in the Scorecard. And earnings are reported at the institution level, not by major—so you see the average for all graduates, which masks huge variation between, say, a nursing major ($65,000) and a philosophy major ($38,000) from the same school.
The Scorecard also now includes earnings data by field of study, which is more useful for comparison. If you're considering engineering, you can see what engineering graduates from College A earn compared to College B.
Loan default and repayment rates: What they signal about outcomes
The College Scorecard reports loan default rates and student loan repayment rates by institution. A cohort default rate (CDR) measures what percentage of borrowers who leave an institution default on federal loans within three years. Federal student aid data shows that overall, 10.3% of borrowers default within three years of repayment. This varies by school type:
- Private for-profit colleges: 14.7% default rate
- Private nonprofit colleges: 6.39% default rate
A high default rate at a particular college isn't necessarily a sign that the school is bad—it might just serve students with fewer financial resources—but it does tell you something about how well graduates are able to manage their debt relative to their earnings. A school where 20% of borrowers default within three years is probably selling students on outcomes that don't materialize.
The new gainful employment rule (which became final in 2023) requires colleges to track debt-to-earnings ratios and compare graduate earnings to what high school graduates earn. Programs that fail this test for two out of three years can lose access to federal financial aid. For the first time, starting in 2026, poorly performing programs face real consequences, which should push colleges to be more honest about outcomes.
Why these numbers don't tell the whole story
Example: Two schools, nearly identical graduation rates, very different outcomes
Imagine School A and School B both report a 75% graduation rate. They look equivalent on paper. But here's what that rate doesn't tell you:
- School A enrolls students with an average SAT score of 1350 and an average high school GPA of 3.8. Seventy-five percent of these high-achieving students finish.
- School B enrolls students with an average SAT score of 1100 and an average high school GPA of 3.2. Again, 75% finish.
School B is actually doing more impressive work. It's moving students further forward relative to where they started. But the graduation rate alone can't show you this.
The College Scorecard breaks down graduation rates by Pell Grant recipients, so you can compare apples to apples. A school that graduates 70% of low-income students may be outperforming a school that graduates 80% of high-income students.
Earnings data has blind spots
When you see that graduates of College X earn $55,000 at age 30, remember:
- That number includes all fields of study. If half the graduates are in high-paying fields and half in lower-paying fields, the average masks both groups.
- It doesn't account for cost of living. A graduate earning $45,000 in rural Nebraska has more purchasing power than someone earning $60,000 in San Francisco.
- It captures only federal aid recipients. If your college has many students whose families paid fully out of pocket, you're missing data on their earnings.
- It reflects the graduates of five or ten years ago, not you. Labor markets change, and what paid well in 2015 might not in 2025.
- It doesn't control for major. The biggest driver of earnings isn't the college—it's whether you studied engineering or education.
Earnings data is real and worth looking at, but it's most useful when you compare students in the same major across schools, and when you cross-check it with program-level data from the Scorecard.
Student-to-faculty ratio is a rough signal
The national average student-to-faculty ratio is around 14:1. A ratio of 8:1 sounds better than 25:1, and in general, smaller classes do lead to more interaction with professors. But this metric has traps:
- It's an average across the entire institution. Large lecture halls pull it up; small seminars pull it down. Your actual class sizes might be very different from the ratio suggests.
- At research-heavy universities, faculty might be focused on grants and publications, not available for office hours. A low ratio doesn't help if professors aren't accessible.
- At teaching-focused colleges, adjuncts (part-time instructors with limited availability) can pull down the ratio artificially. A "good" ratio might reflect part-time staff, not full-time mentorship.
The ratio matters most in fields that benefit from smaller, discussion-based learning—engineering, business, nursing, and sciences. It matters less in large lecture courses where 200 students are taking an intro chemistry class regardless of the ratio.
Retention rates tell you about year one, not graduation
A high first-year retention rate is a good sign—it suggests students are finding support and belonging early on. But it's not a guarantee they'll graduate. A school could retain 90% of freshmen and still graduate only 60% by year six if it loses students in sophomore year or later.
Look for retention rates year to year if the school publishes them. If retention is 90% first to second year but drops to 75% second to third year, that signals a sophomore slump—maybe students are hitting harder coursework, financial barriers, or doubts about their major.
How the data connects: The gainful employment framework
The new Financial Value Transparency and Gainful Employment rule ties these pieces together. Colleges must now show a debt-to-earnings ratio: the ratio of a typical graduate's debt to their earnings. Programs must also pass an "earnings premium" test, proving that graduates earn meaningfully more than high school graduates.
This rule applies to all degree programs at for-profit institutions and all certificate programs at nonprofits. By 2026, programs that fail these tests for two consecutive years will lose federal financial aid eligibility.
What this means for you: Over the next few years, the worst outcomes will get flagged and removed from the federal aid system. Colleges will have stronger incentives to publish real data on what their students earn and what debt they carry. The information asymmetry between schools and students should shrink.
How to use these numbers in real college research
Step 1: Start with graduation and retention rates. These are your baseline. Look at the 6-year graduation rate for bachelor's programs and the first-year retention rate. If both are below 60%, ask why. If they're above 75%, that's generally a positive signal that the school supports students through to completion.
Step 2: Segment by your demographic and major. Ask admissions for graduation rates broken down by first-generation students, students from your state or region, and your intended major. Some schools do much better with certain student populations. The College Scorecard breaks rates down by Pell Grant recipients (low-income students), which helps level the playing field.
Step 3: Look at earnings data by major. Search the College Scorecard for your specific field of study and compare earnings across schools. If you're a business major, don't compare the overall earnings of Business School A ($48,000) to Business School B ($52,000)—that's the average of all graduates across all fields. Search field-of-study earnings instead.
Step 4: Check loan default rates as a red flag. If a college has a cohort default rate above 15%, that's worth investigating. It doesn't automatically mean the school is bad, but it suggests students are struggling to manage debt relative to earnings. Ask the admissions office why, and ask what the typical borrower debt load is and what graduates in your field earn.
Step 5: Consider cost alongside earnings. A school that costs $70,000 per year and reports median earnings of $52,000 at age 25 presents a different risk profile than a school that costs $25,000 and reports similar earnings. The College Scorecard includes cost of attendance, so calculate the total debt picture, not just sticker price.
Where to find the data
- College Scorecard (collegescorecard.ed.gov): Start here. Search any college and get graduation rates, earnings, debt, retention, and more. Download raw data if you want to compare schools side by side.
- IPEDS (nces.ed.gov/ipeds): The National Center for Education Statistics' database. More detailed than College Scorecard, but harder to navigate. Use it to find retention rates and demographic breakdowns.
- Admissions offices: They have the latest data and can answer questions about how the college calculates its rates. Ask for graduation rates by major and by demographic group. Ask about retention rates year to year.
- Federal Student Aid data (studentaid.gov/data-center/student/default): Find cohort default rates by institution.
Why comparison tools matter
Reading these numbers takes time and care. You need to cross-reference multiple sources, understand what each metric excludes, and know the context in which it's reported. That's why tools like CollegeLens exist: to translate raw data into straightforward school comparisons that account for what matters to your family.
When you start a CollegeLens plan, you can:
- Compare schools side by side on graduation rates, earnings, cost, and debt outcomes—all in one view
- See how schools perform for students like you (by demographics, intended major, financial need)
- Understand what graduates from a school actually earn relative to cost
- Get alerted if a school has declining outcomes or rising costs
The data itself is public and free through the College Scorecard. But making sense of it across dozens of schools, and putting it in context for your specific situation, is where the real value lies.
FAQ
Q: Is a 70% graduation rate good? A: It depends on context. Compared to the national average of 64% for 4-year institutions, 70% is solid. But compare it to peer schools with similar admissions standards. A school that admits students with SAT scores around 1050 and graduates 70% of them is performing better than a school that admits students with SAT scores around 1300 and graduates 70%.
Q: Why are earnings data only available for students who received federal aid? A: The College Scorecard earnings come from matching federal financial aid records to tax data. Students who paid out of pocket don't have those aid records, so they're not included. It's a limitation, but federal aid recipients make up the majority of students at most institutions.
Q: Do student-to-faculty ratios affect graduation rates? A: Research suggests smaller classes correlate with student success, especially in fields like engineering, nursing, and sciences where hands-on learning matters. But correlation isn't causation. Schools with low ratios also tend to have wealthier students, more resources, and stronger peer groups—all of which drive graduation rates. A low ratio is a good sign, but it's not the main lever of success.
Q: What does a high student loan default rate really mean? A: It usually means students graduated with debt they couldn't manage relative to their earnings, or they didn't finish and still had to repay. It can reflect a school's outcomes (earnings are too low for debt) or its enrollment (students from lower-income backgrounds with less family support). Either way, it's a signal to dig deeper. Ask what the earnings are for graduates and whether the school supports at-risk borrowers.
Q: Can I compare earnings across colleges if they teach different majors? A: Not directly. If College A is an art school and College B is an engineering school, their average earnings will differ mainly because of major, not school quality. Always filter by major when comparing earnings. Field-of-study data from the College Scorecard makes this easier.
Q: What's the difference between retention and graduation? A: Retention measures whether a student comes back for year two. Graduation measures whether they finish their degree. High retention is a necessary but not sufficient condition for high graduation rates. A school with 90% retention could still graduate only 60% if many students leave in junior year.
Q: When will the gainful employment rule change what colleges report? A: Starting in 2026, colleges must show debt-to-earnings ratios and compare graduate earnings to high school graduate earnings. Programs that fail these measures for two years will lose federal aid eligibility. This should push colleges to be more selective about program offerings and more honest about outcomes.
*— Sravani at CollegeLens*
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