College tuition has risen substantially over the past few years and it seems that every year people are shelling out more and more dough for a post-secondary education. College Board recently released their annual report "Trends in College Pricing" for 2010 which reveals the financial changes in undergraduate tuition and fees, room and board, and other college-related expenses. According to the report, published tuition and fees at public four-year colleges and universities have increased at an average rate of 5.6 percent each year from the 2000-2001 to 2010-2011 decade. Since the 2009-2010 academic year alone, public four-year institutions have increased tuition and fees by 7.9 percent for in-state students and by 6 percent for out-of-state students. Over the decade the growth rate has also led to a 28 percent price increase in average published tuition and fees at private, non-profit four-year institutions. Tuition and fees at these private schools have increase by 4.5 percent since the 2010-2011 academic year.
But despite these increases, an article in the Washington Post reports that the cost of college is actually going down. This is possible because these published charges are not always indicative of the net prices that most students end up paying. College Board reports that only about one-third of students going to school full-time actually pay the full price of their bill without the help of some type of financial aid. According to the article the net price of college tuition and fees inflation is, in fact, currently lower than it was five years ago. The net price is the average cost of attendance that the college publishes minus the average amount of grant aid, and tax deductions and credits, a student typically receives. In other words, the net price is the amount that most students actually end up paying and is usually lower than the published price.
The report found that even though over the 2005-2006 to 2010-2011 five-year period the average published tuition and fees increased by around 24 percent at public four-year colleges and by 17 percent at private non-profit four-year institutions, the average net price declined in each sector after adjusting for inflation. During this five-year period the average net price for tuition and fees at public universities decreased from $2,080 to $1,540 in inflation adjusted dollars. In that time the net price at private colleges decreased from $12,750 to $11,320. This decrease in net price is due to an increase in the amounts of grant aid from all sources and from federal tax benefits. In 2009-2010 the total grant aid per full-time undergraduate student increased by 22 percent, mainly because of significant increases in federal Pell Grants and Veteran’s Benefits. In 2010-2011 students at these public institutions received an estimated average grant aid of $6,100, while those at private institutions received $16,000.
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