College Tuition Study
According to a Bloomberg article by Janet Lorin, college tuition is continuing to rise. The cost of college tuition increased by 3.7% (at private universities) and 2.9% (at public schools), while inflation remained at 1.4%.
The report issued in November, 2014 by the College Board showed that although tuition increases are surpassing the rate of inflation, this years’ rise is less than the averages for the past 5, 10, and 30 years.
The good news is that the total amount of debt borrowed by students decreased by 13% this year. According to the College Board study, overall scholar debt dropped to $106 billion. The work’s authors indicated that some of the decrease in debt may be due to decreasing college and university enrollment.
What is the future of higher education costs?
My gut feeling (oh so reliable!) is that consumers are beginning to push back against the rising cost of higher education. This occurs by lobbying congress for reform and “voting with their feet” by choosing alternative forms of higher education.
As the college board survey found, enrollment at colleges and universities is decreasing. I don’t agree with efforts to regulate tuition costs at the government level. This will artificially decrease the price of college tuition. A better choice is to allow the free market to set the price of tuition through the supply and demand of students.
Are less students borrowing money, or are scholars getting wiser about debt?
What about the figure that debt decreased by 13%? After a decade of rapid increase, overall student debt decreased last year.
The College Board study’s authors were quick to note that this decrease may be due to the decrease in student enrollment. I’m looking forward to seeing this overall debt number for next year before jumping to any conclusions.
It would be fantastic if students were getting the message about the pitfalls of student loans!
How do we change the culture?
Far too many students leave school with the weight of debt. Research by The Institute for College Access and Success showed that 69% of seniors graduated with the burden of educational indebtedness. I’d love to see our country become an economy that is characterized by saving rather than spending.
Wouldn’t it be amazing if in 30 years the United States was in the business of investment rather than overconsumption? This won’t be accomplished until parents begin to teach their children about the dangers of debt and the freedom that comes with financial independence.
All it takes is one generation to change the course of a country. I hope my children are a part of that generation.
Do you think college tuition costs are going to stabilize? Is our culture’s commitment to education loans diminishing?
Photo by Will Folsom.