The Cost of a College Education is on the Rise

[Nov 16, 2007.]

The pricetag on a college education is once again causing sticker shock for many students and their parents.
The College Board reports that the cost of college is once again increasing faster than the inflation rate. The price rose 6.6% at 4-year public colleges and universities.

However, public 2-year colleges appear to be doing best in keeping college costs under control. The average price for a 2-year college education increased 4.2% to $2,361. Because of the help provided by financial aid, the net cost for students only amounted to a little more than $300 a year.

In response to the report, College Parents of America President James Boyle stated, "For too long, parents have grimaced and borne the high price of college because they presumed that a higher education is key to their child's success in today's economy. Surely, the day will come - soon - when parents say enough is enough."

When you take into account grants and tax incentives, the net amount paid by full-time students at 4-year public universities this year was $2,580 - a little more than $150 more than last year's rate. The net cost is appreciably higher at private institutions, where it stands at $14,400 - an increase of $638 from last year.

Ten years ago, private loans represented a little more than 5% of financial aid. Today, they represent nearly a quarter of all aid packages.

It's unclear at this point why college costs are rising so dramatically. However, some analysts reason that states are not spending an appropriate amount per student, leading to higher tuition costs. Congress is now considering a plan that would force some colleges to spend a greater percentage of their savings in an effort to keep tuition costs under control. Some Congressional representatives believe that college costs have climbed so high that prospective students have been priced out of the market.

Julie Ann Amos
November 16th 2007

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