Attention all students: you may no longer hold the ‘broke college student’ status.
With the cost of tuition continually rising, schools are offering more aid to draw in the already decreasing number of students who can afford higher education.
After increasing for decades, the real cost of attending both public and private schools is now flat and in some cases even declined this year, as colleges compete for fewer students by giving away more scholarships.
This is the result of the price for higher education continuing to accelerate even though fewer students can actually pay. This is according to an annual pricing-trends report by the College Board, a New York nonprofit that administers the SAT and tracks university costs.
“The trends in college financing have changed in recent years, particularly at public colleges and universities,” Sandy Baum, co-author of the 2018 Trends in Higher Education report, said in a statement.
Tuition rose rapidly during the four academic years between fall 2007 and spring 2011. “Federal expenditures on student aid increased dramatically, helping a growing student population to finance their education. At the same time, students borrowed more and more,” Ms. Baum said.
But since then, all these trends have now reversed.
The average net cost of a year at a four-year public college or university, including tuition, fees, room, and board, decreased to $14,880 in 2018–2019, falling slightly from $14,910 in 2017–2018. According to the report, the cost is still $3,400 greater than a decade ago in inflation-adjusted dollars.
The net price for four-year private schools was $27,290, up from $27,160 last year. Those numbers are based on 2018–2019 tuition rates but prior-year financial-aid figures, and will be revised once financial-aid and tax data are released for the current school year.
The rise in grants has drastically increased too.
Grants and tax benefits climbed to $21,220 this year, up from $13,860 in 2008, at private schools. At public institutions, they rose to $6,490 this year from $4,970 in 2008.
Increased grants from schools allowed undergraduates to borrow less from the federal student-loan program. These grants are a way for private institutions to offer more aid to low-income students.
What Is The Future For Higher Education?
The decline in public-college costs happened after legislators sharply cut funding during and immediately after the recession. Meanwhile, private colleges are increasing financial aid as they fight harder to appeal to students, starting with high-school graduates.
This demographic drop is expected to accelerate, as decreasing U.S. fertility rates lead to a lack of college-ready children, for mainly the next two decades.
Most vulnerable to this decline are the group of private colleges that depend mostly on student tuition because they have small endowments.
What the result would entail is about one in five small private colleges would be in trouble.