College Focus: The Price Of College

The Price of College
 
​What does it cost to attend college today?
 
The College Board has produced the latest sticker price for what one year in college costs today for:
 

• Public universities
• Private, non-profit universities
• Two-year public colleges
• For-profit universities

 
Here are the published prices for tuition/fees and room/board, as well as the combined costs for these institutions:

​Not surprisingly, the cost of college continues to outpace inflation, which is a trend that has held steady for decades.
 
When looking at these figures, it's important to know that 70% of students do not pay the sticker price. However, some schools are certainly more generous than others. The key is for students to strategically find and apply to schools that are not just a right fit academically and socially, but will will be financially generous given your situation as well.
 
Pricing Takeaways
 
There are a few other takeaways from the latest price figures:
 
1.The average published tuition of $33,480 that private non-profit schools charge is $8,550 (34%) higher than the average public four-year, out-of-state price.
2.Attending a public university outside a student’s state will cost an average of $15,280 more than for residents. The out-of-state premium increased by 4.3% from the previous year.
3.The estimated $16,000 average tuition/fees for full-time students enrolled in for-profit schools is about 4.5 times as high as the average price at public community colleges and 1.7 times as high as the average in-state price at public four-year institutions.
 
College Net Prices
 
The College Board pricing report also included figures on what the average net prices are after typical grants and higher-ed tax deductions are subtracted.
 
Here are net college costs:
 
In-state public universities:
Tuition/fees & room/board: $14,210
 
Private nonprofit universities:
Tuition/fees & room/board: $26,100
 
Shrinking Ability to Pay
 
The College Board’s study also contained sobering statistics on parents’ ability to afford college.
 
During the past decade, Americans’ income has not kept up with the rapidly increasing price of college. And that’s true even for parents in the top five percent of income.
The income gains, as you’ll see in the chart below, were considerably higher from 1985 to 1995 and then slowed down in the next decade and dropped considerably after that.

Trump and Higher Education
 
The higher-education world is bracing for potential changes when President Trump assumes office. However, many college administrators expect higher-ed changes won’t be as pressing as other stated issues of the new administration such as eliminating or replacing Obamacare and immigration reform.
 
It’s likely that the Trump administration will welcome private lenders back into the college loan market, which would be a reversal of the Obama administration that chased banks out of the federal student loan business in 2010. Before that time, federal loans either originated directly with the federal government or with banks.
 
Earlier this year, a Trump spokesman said Trump wants to get the government out of the college lending business.
Trump’s pick for Secretary of Education is Betsy DeVos, a conservative billionaire from Michigan. Like anyone in politics, DeVos has her share of advocates and critics. Her advocates applaud her for being pro-school-choice and championing charter schools and vouchers that would allow public dollars to be spent on private or religious K-12 schooling. On the flipside, her critics fear she will favor moving money away from regulated public schools into for-profit and private schools that may lack the same standards required of public schools.
 
WEBSITES OF THE MONTH

• Compass Education Group

This California-based test prep firm offers excellent advice on all aspects of the SAT and ACT, including which test to choose and how many times a teenager should take on of these standardized tests.
 
QUESTIONS
 
Have questions you’d like me to address in future College Focus newsletters? Please send them to michael@blomassociates.com.

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This research material has been prepared by Horsesmouth
 
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.