The Cost of a Four-Year College Degree

In a study of incoming freshman in 2009, conducted by the Higher Education Research Institute at the University of California at Los Angeles, two-thirds of respondents reported that they were very worried or at least somewhat worried about their ability to pay for their college degrees. There are good reasons for worry. Higher education is more expensive now, when compared to income, than it’s ever been before, and there seems to be no end to the rise in sight.

Worry and fear shouldn’t keep students away from the educations they deserve, however, as there are a variety of techniques that can be used to keep costs down and opportunities up.


Parsing the Numbers

Public high schools are paid for with taxpayer dollars, meaning that students are often not responsible for anything other than assorted fees. They can show up to these schools and get their educations without ever writing an exorbitant check for their schooling. Much of this changes in college. In fact, students are often expected to shell out quite a bit for an undergraduate degree. This number can seem scary, but unfortunately, it’s also incomplete.

Source: College Board, as reported by Forbes

hold off on even entering school until they can come up with some funding to pay for their education. Sadly, students who don’t enroll now might be asked to pay even more in the years that follow since tuition rates seem to go up each and every year. In fact, the price of education is rising higher than the price of almost anything else.

Item Price increase since 1978
Medical expenses 601 percent
Food-related expenses 244 percent
College fees and tuition 1,120 percent

Source: Bloomberg News

avg cost to attend college

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Rising Cost of College
No one is quite sure why a college degree is becoming more and more expensive to obtain but it’s possible that many factors play a role, including:

  • Decline in taxpayer support for higher education
  • Administrative costs by colleges and universities
  • Teacher compensation packages
  • Building refurbishments
  • Rising cost of real estate
  • Demand for well-funded sports teams
  • Recruitment costs for the “top” students

This is the sort of issue that economists and other experts might debate for decades, and each person might have his/her pet theory about what’s really happening. Students don’t really need to get embroiled in these debates but they will need to make smart decisions about their money. Often, this involves remembering what a college education is really worth.


earning a college degree

The Benefits

It’s no secret that college is expensive, but those who choose to take the plunge may find that their investment pays big dividends. After all, those students who have a college degree tend to experience a variety of benefits.

In addition, there are a number of positions that are simply out of reach unless applicants have a college degree standing behind them.

For example, Georgetown University suggests that 63 percent of all jobs open in 2018 will require a college degree of some sort.

Those students that enter school now may be ready for those jobs, while those who don’t attend may not.

Some of the benefits of college might even be difficult to measure. As Albert Einstein once said:

When the benefits are so diverse, it simply pays for students to get involved and get enrolled.


How Do They Pay?

While few students would dispute the benefits of a college degree, many may find that they can’t readily afford school without a little help.

financial assistance needed

Source: Princeton Review

But not all students get financial aid, and when they’re facing high costs, they might need to take on debt in order to bring their dreams of a college education to fruition. Statistics suggest that more families than ever before are making this choice in order to help their students to succeed.

financial aid taken

Source: The New York Times



Conceptual image of electrical hanging bulbs. Idea concept

Smart Choices

In 2012, the average amount of debt held by students stood at $29,400, according to the Institute for College Access and Success. That’s certainly a lot of money, but there are some things students can do in order to ensure that they’re borrowing in a reasonable way.

First off, it pays to compare the cost of schools, and find the institution that might be best suited to offer a degree without causing severe financial distress. In a case highlighted by CBS Moneywatch, a student had been offered a scholarship for an institution in New York which would have allowed him to graduate without debt, but the family was considering a $200,000 loan in order to allow the student to attend Cornell University. While big-name schools can sometimes be advantageous, nabbing value when it comes might also be smart.

Even students who don’t have scholarship letters to compare can do some smart researching via the U.S. Department of Education’s College Affordability and Transparency Center. Here, they can generate their own side-by-side comparisons between many schools.


Borrow Smart

Even when students do their homework and hope to keep down their costs, they might be forced to take out loans to pay for their educations. Even these students can take steps to cut their costs and make sure that they’re making smart borrowing decisions.

Getting advice from an elder is a good place to start, as there’s often a discrepancy between how much students think they should borrow and how much their guardians think is appropriate.

Source: ABC News
thoughts on borrowing
Just going over loans with a trusted advisor could help students to make smarter decisions about how much they should borrow and how much they might consider giving up to stay within their budgetary goals.

Another great piece of advice involves staying in school once those loans are in place, as students who begin to borrow and then drop out have almost no chance of paying back those loans in a timely manner.

If students must take out loans, they also must stay in school. It’s just that simple.

If you’d like to find out more about how to get the funding you need for school, keep browsing our website. We have tools that can help you to compare student loans, find scholarships and learn how to consolidate the loans you already have.


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