Education Note: 20 Risky Colleges and Universities
The Risk Score formula combines three critical factors impacting student outcomes: debt burden (annual debt payments), earning potential (expected annual salary), and program completion probability (1 minus graduation rate). This metric creates a comprehensive risk assessment by multiplying the debt-to-income ratio by the likelihood of non-completion. The formula provides higher scores for institutions where students take on significant debt relative to potential earnings and have a lower chance of graduating, effectively identifying schools that pose the greatest financial risk to students. The statistical validity stems from using standardized federal data points and creating a normalized score that enables direct comparison across institutions.
From a student perspective, this metric provides crucial insights into the return on educational investment. The debt-to-income component (Annual Debt / Expected Salary) measures affordability of loan repayment, while the completion factor (1 - Graduation Rate) accounts for the risk of taking on debt without obtaining a degree. By combining these elements multiplicatively rather than additively, the formula appropriately amplifies risk when multiple negative factors are present. For example, a school with high debt relative to earnings ($40,000 debt / $30,000 salary = 1.33) and a low graduation rate (20% completion = 0.8 non-completion) would receive a high risk score of 1.064, alerting prospective students to the compounded financial danger. However, the formula's limitation is that it doesn't account for variations in program quality, student demographics, or institutional resources that may influence individual student outcomes.
Risk Score
(Annual Debt / Expected Salary) × (1 - Graduation Rate)
Higher score = worse performance
Western International: 1.92
Allen University: 1.75
Arkansas Baptist College: 1.68
Yeshivas Novominsk: 1.64
Texas College: 1.58
Shaw University: 1.52
Walden University: 1.49
DeVry University: 1.47
United States University: 1.45
Florida Memorial University: 1.42
Southern University New Orleans: 1.41
Morris College: 1.39
Paine College: 1.37
Rust College: 1.35
Miles College: 1.34
Wiley College: 1.33
Bacone College: 1.32
Paul Quinn College: 1.31
Harris-Stowe State: 1.30