Are For Profit Colleges Bad?

Are for profit colleges bad? Not all for profit colleges are bad. Generally, however, the fact that they are ‘for profit’ passes the impression that they prioritize profit over quality education, which is sometimes true. By default, a for profit school isn’t bad but they can make questional decisions, such as deceptive advertising and false promises that make them milk students dry. Sometimes, their manner of operation leaves students in huge debts.

I recently made a post about some online, for profit colleges you might want to avoid due to their soiled reputation. Check that out. Before you invest in any for profit school, you want to carefully do your own research on the spe to be sure they are even worth it in the first place. You don’t want to earn a useless degree that will make you return to declare the school a degree mill or a scam.

What Are For Profit Colleges?

For-profit colleges are businesses that aim to make a profit. They often have well-known names and make big promises. However, these schools generally don’t provide good value for most students. In contrast, not-for-profit schools, like public and private nonprofit colleges, focus mainly on quality education. For-profit colleges prioritize making money.

Looking at spending on student instruction can be revealing. For-profit colleges spend about 29 cents of every tuition dollar on instruction. Private colleges spend 84 cents, and public colleges spend $1.42. Advertising is another area to look at. For-profit schools spend about $400 on advertising per student, while public schools spend only $14.

However, students considering for profit schools have a better option. They can usually find the same programs at community colleges for a lower cost. This information helps students recognize and avoid predatory for-profit schools.

For-profit colleges are educational institutions at the postsecondary level that offer certificates, diplomas, and degrees. Their primary goal is to generate profit, which is different from nonprofit colleges. This focus on profit comes from the expectations of investors and shareholders to see financial returns. Consequently, the cost of attending these colleges is usually higher.

Are For Profit Colleges Bad?

Whether for-profit schools are “bad” depends on how you see it. Yes, they try to make money, and that’s often their top goal, not always focusing on educating students or helping them succeed in their careers. But it’s not just for-profit schools; some nonprofit schools also might not prioritize their students enough. They might be more focused on financial survival or looking good on paper, like having impressive faculty and facilities. Sometimes, staff can be too focused on research, which is important for their evaluations. If you’re not planning a career in academia or further studies, a school known for good teaching might suit you better.

For-profit schools aren’t bad by default, but they might not be right for everyone. They’re good for some people who want practical skills for specific jobs. However, they can be seen as less accountable businesses, so it’s important to be cautious.

Characteristics of For Profit Colleges

Sources of Income

Colleges use different funding methods, including tuition fees, endowment funds, and government support. Public colleges, for instance, get funding from state governments.

In contrast, for-profit colleges are funded by investors seeking to recover their investments. This leads these colleges to focus heavily on cost reduction and profit maximization.

Goals and Financial Strategies

The main goal of for-profit colleges is to earn money. Unlike nonprofit or public colleges, where education is the main focus, for-profit institutions work to reduce expenses and increase income to report profits. This approach influences various aspects like admission standards, tuition fees, and the availability of financial aid.


For profit colleges often charge more than public schools but less than private nonprofit ones. Yet, students at for-profit colleges usually get fewer scholarships and loans. This leads to higher student loan debt. In 2021, these colleges enrolled 10% of all college students but were linked to half of all student loan defaults.

Programs Offered at For-Profit Colleges

These colleges mainly offer career-focused programs like engineering technology, medical coding, culinary arts, cosmetology, and automotive technology. However, similar vocational degrees are available at community colleges, often at a lower cost.

Flexible Learning Options

For-profit colleges often promote their flexible learning schedules, including online classes and programs suited for working adults.

They might offer classes that don’t require simultaneous participation, fitting into busy schedules. However, similar flexible learning options are also available at community colleges, public universities, and private nonprofit colleges.


For-profit colleges might be accredited by national or program-specific agencies. Some of them also have regional accreditation, which is considered the standard for academic quality.

Accreditation ensures a school meets certain educational standards. The highest level is regional accreditation. Many for-profit schools are accredited by national agencies, which have different criteria than regional ones.

Some for-profit colleges even mention unapproved accrediting bodies. So, potential students need to check a college’s accreditation status before applying.

Enrollment Policies

For-profit colleges usually accept students with lower academic achievements. They often skip the need for standardized test scores and sometimes accept all students, regardless of GPA. This can attract students with lower grades or test scores, but it mainly benefits the colleges financially, as admitting more students increases their revenue.

Transferring Credits

Credits from for-profit colleges often don’t transfer to other institutions because these colleges usually lack regional accreditation. This means students can’t transfer their credits to complete their degree elsewhere and may have to repeat courses, paying again for the same education.

Challenges Facing For-Profit Colleges

For-profit colleges are often criticized for poor educational standards and high student debt. A 2021 study showed these colleges are prone to closure, disrupting support for students and alumni. Their graduation rates are also low. For instance, while over 40% of Black students at public and private non-profit universities graduate in six years, only 14% at for-profit colleges achieve the same.

Student Activities and Campus Life

For-profit colleges usually have fewer student activities and support services compared to nonprofit institutions. Costs prevent them from offering facilities like academic libraries, counseling, or tutoring. This can lead to students at for-profit schools feeling less supported and missing out on common college experiences.

Examples of For-Profit Colleges

For-profit colleges are known for their extensive advertising and sometimes use names resembling traditional non-profit institutions, which can be confusing for students. Here are some notable for-profit colleges:

  1. American National University
  2. American Public University System
  3. Berkeley College
  4. Capella University
  5. DeVry University
  6. Grand Canyon University
  7. Strayer University
  8. University of Phoenix
  9. University of the Potomac
  10. Walden University

Difference Between For Profit and Nonprofit Colleges

Nonprofit colleges prioritize student education as their key goal. In contrast, for-profit colleges aim to make profits for their owners. This core difference influences how each type of college operates.

Regarding educational standards, nonprofit colleges often have a higher ranking. In a 2021 study, 80% of for-profit colleges were deemed costly but of low quality. Only about 16% of these colleges were considered high-quality.

For-profit colleges usually focus on career and technical education. However, many two-year colleges provide similar courses but are more affordable and of better quality.

Pros of For-Profit Colleges

Despite the general recommendation to choose other options, for-profit colleges do offer certain advantages. They usually have a vocational focus and provide flexible learning options.

1. Higher Acceptance Rates

For-profit colleges are often easier to get into. They typically have higher acceptance rates, which can be a boon for students with lower GPAs or test scores. However, it’s worth noting that many community colleges also have accessible admission policies and don’t require high test scores.

2. Focus on Vocational Training

For-profit colleges often specialize in vocational education. They offer programs in fields like automotive and engineering technology, and healthcare. This vocational approach can lead to career growth and potentially higher earnings. But remember, vocational programs are also available at many nonprofit and public institutions.

3. Flexible Learning Options

These colleges often provide flexible learning schedules, such as evening or weekend classes, and part-time or online study options. This flexibility is particularly beneficial for working adults, parents, and those with demanding schedules. However, similar flexibility is also offered by many community, private, and public nonprofit colleges.

Cons of For-Profit Colleges

Attending for-profit educational institutions often leads to several significant disadvantages. Students usually end up with more debt, face issues with credit transfer, and have difficulties securing employment. Generally, the negatives of attending for-profit institutions overshadow the positives.

1. Steep Costs

Students from for-profit institutions typically incur higher debts. Data from 2018 shows that while 66% of public college graduates and 75% of private non-profit college graduates had student loans averaging $25,550 and $32,300 respectively, a staggering 88% of for-profit college graduates had an average debt close to $40,000.

2. Unfavorable Perception

For-profit educational institutions are often viewed unfavorably. Many are perceived as easy degree providers, offering diplomas with minimal standards or without necessary coursework. This negative perception can significantly hinder a graduate’s ability to find employment.

3. Potential Employment Barriers

A degree from a for-profit institution may negatively impact employment opportunities. Many employers are hesitant to hire individuals with degrees from these institutions. These degrees may not fulfill professional licensure or certification requirements, leaving graduates at a disadvantage in the job market.

4. Lack of Focus on Student’s  Welfare

While public and nonprofit colleges often center their mission around student welfare and learning outcomes, for-profit colleges may fall short in this aspect. Their primary focus tends to be on profit-making, overshadowing the educational needs of the students.

5. Challenges with Credit Transfer

Transferring colleges is a common occurrence in higher education. Unfortunately, credits from for-profit colleges often don’t meet the criteria for transfer to other educational institutions, especially those that are regionally accredited. This situation forces transfer students to repeat and pay again for the same courses.

6. Lower Graduation Rate

For profit colleges tend to have very low graduation rates so that they can keep milking students. They are appealing with 100% acceptance but many only have a 24% graduation rate. If you are about online education, a school like Arizona State Online would be a much better choice for you. Their degree does not indicate ‘Online’ and they have a brick-and-mortar campus as well.

Conclusion—Are For Profit Colleges Bad?

Not all for profit schools are bad. Usually, the bad ones are characterized by deceptive advertising, a really low graduation rate, prioritizing investors’ pockets over quality education, and not having regional accreditation, which is like the standard of accreditation.

Also, you can tell if a school is for profit. Check the College Scorecard to see if a school is for-profit, nonprofit, or public. This website is managed by the Department of Education and also provides details about graduation rates, costs, and the average earnings of alumni.

Generally, people believe that degrees from for-profit schools often don’t lead to good outcomes. These schools usually have low graduation rates and high student debts, making them a financially risky option.

Read alsoIs Thomas Edison State University Legit?

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