NEW YORK — The College Board announced today that college prices for the 2009-10 academic year continue to rise as state funding and endowment values decline. The financial difficulties facing households across the nation are putting increased pressure on financial aid budgets. Although grant aid also rose significantly in 2008-09 (the latest year for which data are available), student borrowing continues to increase, as does the gap between available resources and the overall cost of attending college.
Trends in College Pricing 2009 and Trends in Student Aid 2009 provide insight into how colleges and universities and their students are grappling with recent economic pressures.
College Board President Gaston Caperton said, “It is vital that we assure access to a high-quality college education for all students. While a college education is critical to long-term financial security, it feels out of reach to many students and families in today’s economy.
“States and institutions must increase their efforts to reduce costs and to prevent tuition from rising as rapidly as it has in the past. We must provide generous financial aid for those who most need the funds and help students and families to understand the wide array of options available to them in our diverse educational system.”
The average published price of tuition and fees for in-state students at four-year public colleges in the U.S. is $7,020 in 2009-10, $429 (6.5%) higher than a year ago. After adjusting for inflation, the average net price paid for tuition and fees by public four-year college students overall is lower in 2009-10 than it was five years ago — but higher than it was last year.
Like published prices for tuition and fees, expenses for food, housing, books and supplies, and other living costs continue to rise more rapidly than the rate of inflation, and only at public two-year colleges does grant aid for the average student stretch beyond tuition and fees.
Undergraduate tuition and fees at public two-year colleges in 2009-10 average $2,544, compared to $5,930 at public baccalaureate colleges, $6,094 at public master’s universities, and $7,797 at public doctorate-granting universities. In the private not-for-profit sector, tuition and fees average $24,040 at baccalaureate colleges, $23,700 at master’s universities, and $32,349 at doctorate-granting universities. About 19% of full-time private college students are enrolled in institutions with published prices below $18,000, and 20% attend institutions with prices $36,000 or higher.
Average price changes for the 2009-10 academic year are summarized in the table below:
|Published 2009-10 Tuition and Fees||$26,273||$7,020||$18,548||$2,544||$14,174|
|One-Year Dollar Increase||$1,096||$429||$1,088||$172||$859|
|One-Year Percentage Increase||4.4%||6.5%||6.2%||7.3%||6.5%|
|Estimated Average Grant Aid and Tax Benefits per Student||$14,400||$5,400||$3,000||NA|
Published tuition and fees at public four-year colleges and universities rose at an average annual rate of 4.9% per year beyond general inflation from 1999-2000 to 2009-10, more rapidly than the 3.0% and 4.0% of the previous two decades. However, the rate of growth of published tuition and fees at both private four-year institutions (2.6%) and public two-year colleges (1.8%) was lower from 1999-2000 to 2009-10 than in either of the previous two decades.
Room and board and other expenses are similar for all full-time students. While many of these are expenses individuals face whether or not they are in school, paying for them without full participation in the labor force presents a serious challenge for many students. Tuition and fees account for 67% of the average estimated budget for students living on campus at private four-year colleges, but only 36% for in-state public four-year college students and 18% for students not living with parents and commuting to public two-year colleges.
About two-thirds of full-time undergraduates receive grants. In 2008-09, they received an average of $5,041 in grant aid per full-time equivalent student, supplemented by $4,585 in federal loans. Forty-one percent of all grant aid to postsecondary students was provided by colleges and universities, 32% by the federal government, 11% by states, and 16% by employers and other private sources. Over the decade from 1998-99 through 2008-09, grant aid per undergraduate student increased at an average of 3.4% per year after adjusting for inflation.
In 2007-08, public four-year institutions distributed about two-thirds of their institutional grant aid without regard to financial circumstances. Students from families with incomes below $32,500 received an average of $700 in non-need-based and $830 in need-based institutional grant aid, compared to $940 and $300, respectively, for those from families with incomes between $60,000 and $100,000. Students at private not-for-profit four-year institutions receive significantly more institutional grant aid than do those at public colleges and universities, and the patterns of that aid differ considerably at institutions with different prices.
For students from the lowest-income families, on average grant aid covered total tuition and fees at public two-year colleges from 1992-93 through 2007-08 and at public four-year colleges and universities from 1999-2000 through 2007-08, the last year for which data are available. From 2003-04 to 2007-08, after subtracting grant aid, average net tuition and fees declined for lower-middle-income students at public four-year institutions, but increased at an annual rate of 2% to 3% beyond inflation for those from families with higher incomes.
For all dependent students except those from families with incomes of $100,000 or higher, average tuition and fees net of grant aid at for-profit colleges was higher than that at private not-for-profit four-year institutions in 2007-08. On average, net price declined for the lowest-income dependent students at private not-for-profit four-year colleges between 2003-04 and 2007-08.
Sandy Baum, senior policy analyst at the College Board and former professor of economics at Skidmore College, said, “As students and families face the challenge of paying for college in these difficult economic times, it is vital that they have accurate information. There are many colleges and universities providing different educational experiences and charging different prices, and grant aid is available from a variety of providers. It is important to complete the aid application process and to get advice from reliable sources. Students should look for all the grant aid available before borrowing and should rely on federal loans rather than loans from other sources whenever possible.”
States appropriated $78.5 billion to fund public colleges and universities in 2008-09. Although this total funding has more than kept up with inflation over the long term, it failed to do so in 2008-09. Moreover, because of increases in enrollments, the $7,953 state tax appropriation per student in 2008-09 was 12% ($1,100) lower in constant dollars than a decade earlier. State appropriations per $1,000 in personal income have declined steadily from a national average of $9.74 in 1989-90 to $7.36 in 1999-2000 and $6.50 in 2008-09. Like tuition levels and state student grant policies, appropriation levels and year-to-year changes vary considerably across states.
The College Board’s estimates indicate that nonfederal education loans declined by almost 50% from 2007-08 to 2008-09. Total education borrowing increased 5% from 2007-08 to 2008-09 — a slight decline after adjusting for inflation. Federal loans increased by about $15 billion, while nonfederal loans declined by about $11 billion.
In 2007-08, 35% of undergraduate students took out federal Stafford Loans, and 65% did not. Half of all full-time undergraduates used these loans. Sixty-five percent of 2007-08 bachelor’s degree recipients graduated with education debt, and median debt for those who borrowed was $20,000. Among public four-year bachelor’s degree recipients, 38% graduated with no education debt, while 6% owed $40,000 or more. Among for-profit bachelor’s degree recipients, 4% had no education debt, and 24% owed $40,000 or more.
Among students who earned graduate degrees in 2007-08, 26% had no education debt at all and another 14% had undergraduate debt but no graduate school debt. However, 7% had borrowed $80,000 or more for graduate school, and another 5% had borrowed between $60,000 and $80,000. Graduate debt averaged $35,750 across all students and $61,120 among those who had borrowed. About one-third of this total debt was from undergraduate study.
To access the complete reports and for additional detailed information, visit our Trends website (www.collegeboard.com/trends).
The College Board
The College Board is a not-for-profit membership association whose mission is to connect students to college success and opportunity. Founded in 1900, the College Board is composed of more than 5,600 schools, colleges, universities and other educational organizations. Each year, the College Board serves seven million students and their parents, 23,000 high schools, and 3,800 colleges through major programs and services in college readiness, college admission, guidance, assessment, financial aid, enrollment, and teaching and learning. Among its best-known programs are the SAT®, the PSAT/NMSQT® and the Advanced Placement Program® (AP®). The College Board is committed to the principles of excellence and equity, and that commitment is embodied in all of its programs, services, activities and concerns. For further information, visit www.collegeboard.com.
Nancy Viggiano, The College Board, 212-713-8052, firstname.lastname@example.org