Today, Americans hold about $1.4 trillion in student debt. While the cost of higher education continues to rise and politicians debate the idea of making it free, a majority of Americans are feeling stressed about student loans.
But when legendary investor Warren Buffett earned a Master of Science from the School of Business at Columbia University studying economics in 1951, the yearly tuition bill for an Ivy League education looked a lot different than it does now.
A year of studying for a Master of Science in Financial Economics at Columbia for the 2017-2018 academic year will run you an estimated $91,760, according to the university's website, with $58,512 for tuition and $21,375 for housing.
For the 1950-1951 academic year, the estimated average cost for a man to study at the Graduate School of Business at Columbia was $1,690, according to the Columbia University Archives. The estimated average cost for women was $1,800, with slightly higher estimated costs for room, board and laundry.
That $1,690 from June of 1951 when Buffett graduated has the buying power of $16,105 in today's dollars, accounting for inflation. Today the total estimated cost of attending is almost six times that.
Here's how the estimated average cost of a year broke down for men, according to a copy of the 1950-1951 Business School bulletin of information, shared by Columbia's Rare Book and Manuscript Library:
Tuition and fees — $620
Room — $260
Board — $450
Books and drawing materials — $50
Laundry — $90
Additional expenses, including clothing, travel, charity organizations and sundries — $220
And for women:
Tuition and fees — $620
Room — $375
Board — $475
Books and drawing materials — $50
Laundry — $60
Additional expenses, including clothing, travel, charity organizations and sundries — $220
"The room, board, books and laundry figures are based upon the rates which prevailed during the past academic year, and can be accepted as applicable for the year 1950-1951 unless national economic changes require their alteration," according to the bulletin. "The cost of clothes, travel, and incidentals is, of course, variable, depending on the tastes and financial situation of the individual."
Buffett, notoriously thrifty, paid even less than the estimate for housing, living on the sixth floor of an apartment building across the street from the university. "I had the maid's room and paid $10 a month," Buffett tells CNBC in a 2009 interview. That would be $95 in today's dollars.
For future business tycoons, Buffett says a higher education is beneficial, according to a 2001 article in Nebraska Business magazine, a publication of the University of Nebraska, from which he got a Bachelor of Science in Business Administration in 1950.
"If you are interested in business, or likely to be in business, an MBA is very useful," Buffett says. "But, what is really important is what you bring to a class in terms of being interested in the subject. If you view a course like accounting as a drudge and a requirement, you are missing the whole game. Any course can be exciting. Mastering accounting is like mastering a new language, it can be so much fun."
In his own graduate program, Buffett was able to learn from two of his mentors, Benjamin Graham, known as the father of value investing, and David Dodd. He had studied their work as a young adult, and after being rejected from Harvard, noticed the names of the two professors in a catalog for Columbia Business School.
"I had read this book ['Security Analysis'] by the two of them, so I wrote them a letter in mid-August," Buffett explains in HBO's documentary "Becoming Warren Buffett." "I said, 'Dear Professor Dodd. I thought you guys were dead, but now that I found out that you're alive and teaching at Columbia, I would really like to come.'"
He was admitted and developed a close relationship with the two men.
"[Dodd and Graham] would take me up to this little restaurant every now and then for dinner," he tells Columbia's Glenn Hubbard in an interview. "The encouragement I got from them was as important as the ideas.
"I could read the ideas, but it's something else when you have someone whom you revere put their arm around you and say, 'You know, you've got a great future.'"
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