College Price Increases Moderate, But Reliance on Borrowing Still Rising
Price increases at colleges and universities slowed down somewhat this year, but students who need financial aid are still relying increasingly on loans to pay for higher education, according to figures released by the College Board in October.
The average cost of tuition and fees at a four-year college hit $5,491 this year, up 7.1 percent from 2004-2005, according to the annual survey by the nonprofit group. That was the smallest percentage increase since 2001-2002.
Prices at two-year public colleges rose 5.4 percent to $2,191, while at private schools they rose 5.9 percent to $21,235.
The increases are below levels seen in recent years. Last year, prices at public four-year schools rose about 10 percent, and 13 percent the year before that. But the cost hikes are still well above the general inflation rate.
And while many students don’t pay the full “list price,” other figures indicate student aid is not keeping up with need.
Student aid from the government and other sources did increase $10 billion to $129 billion in 2004-2005. But for the third straight year, more of the increase came in the form of loans than from grants, which students do not have to pay back.
That isn’t necessarily a big problem for many families. Interest rates are low, and the increased earning power of a college degree is generally worth the average debt for undergraduate borrowers — $15,500 at public universities for a bachelor’s degree. But it is likely to compound concerns that families on the economic bubble will be priced out of higher education.
Including charges for room and board as well as tuition and fees, annual costs at public four-year schools rose 6.6 percent to an average of $11,376. At private four-year nonprofit schools, they rose 5.7 percent to $27,465.
However, only 12 percent of students are enrolled in colleges where yearly tuition and fees exceed $24,000.
— Associated Press
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