College decision day is closing in and many prospective students are making commitments to their university of choosing. With that commitment comes an enrollment deposit – one of many fees students will pay in the next four years.
Of the more than 60,000 high school graduates, 64% will go on to enroll in two- or four-year college programs. Many will incur debt and join the already 43.5 million Americans who have student loans.
Last year, President Joe Biden's student debt cancellation plan was struck down by the Supreme court. Now he's proposing a workaround that could cancel the loans of more than four million borrowers, according to the White House. In addition, more than 10 million borrowers could get $5,000 in debt relief.
Whether or not the new proposal works, many college students will be paying nearly two-fold what their parents paid for an undergraduate education 20 years earlier. According to the Education Data Initiative, the average cost of college tuition and fees at public four-year institutions has risen179.2%over the last two decades.
How much does college tuition cost?
The average cost of an undergraduate degree ranges from$25,707 to over $218,000, according to the Education Data Initiative. The price varies and depends on whether a student lives on campus and the institution they're attending.
According to the most recent data from the Education Department, the average tuition at a four-year private nonprofit university increased 14% between the fall of 2010 and fall of 2021.
Chart shows rise in cost of 4-year college
In 2023, the average full time student at a four-year college spent nearly $31,000 on their tuition fees, room and board for the year. That number is more than double amount paid for the same education in the 1960s, adjusted for inflation in 2022-2023 dollars.
Why is college tuition rising?
The demand for a college education is going up – at the same time government funding for postsecondary education is on the decline, according to Bankrate.
The personal finance website pointed out several key areas that have lead to an increase in tuition costs:
- The cost of operation is increasing, due to rising inflation. The inflation rate increased 3.5% between March 2023 and 2024, according to the Bureau of Labor Statistics. With rising inflation comes increased cost of living. Universities must pay highly educated professors more to keep up with rising living costs.
- A reduction in state funding led to increased tuition costs, according to the National Education Association. An analysis from NEA found that state funding for higher education decreased in 37 states by an average of 6% between 2020 and 2021.
- Colleges are spending more on administrative services: A 2021 study found that between 2010 and 2018, spending on student services and administration grew by 29% and 19% respectively.
Some universities are already estimating the cost of attendance for the 2024-2025 academic year to be nearly $100,000.
