Both College Tuition Prices and Financial Aid See Large Increases

According to the College Board's annual report on trends in college prices, increases in tuition this past year were matched by higher levels of financial aid. Published in-state tuition and fees at four-year public colleges and universities increased $555 (7.9%), to an average of $7,605. With room and board, the figure for the past year totaled $16,140 (up 6.1%).

Tuition at private nonprofit colleges and universities increased to an average of $27,293 (4.5%); with room and board, $36,993 (up 4.3%). A New York Times article on the report points to decreases in state financing as the main culprit for the higher prices.

But Sandy Baum, an economist and lead author of the report, quoted in the article, points out that price increases have been offset by increases in financial aid. In the past year, students received $28 billion in Pell grants--$10 billion more than the year before. According to the article, despite sharp tuition increases in the past five years "in each sector [public four-year colleges and universities, private nonprofit four-year institutions, and public two-year colleges], the net inflation-adjusted price, taking into account both grants and federal tax benefits, decreased over the period."

Full-time students "receive an average of about $6,100 in grant aid and federal tax benefits at public four-year institutions, $16,000 at private nonprofit institutions, and $3,400 at public two-year colleges." Of course, the increase in Pell grants this past year, while enabling many low-income students to get an education, does not help those families not eligible for financial aid, few of whom have seen an increase in their income in line with the 8% rise in tuition costs.
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