Take a Hike: The Rising Cost of Getting a College Degree
By Consumers Union on Tuesday, April 1st, 2014
By: Caitlin Watkins
Since the 1980’s, the cost of higher education has increased much faster than the rate of inflation. As a result, the cost of tuition has skyrocketed over the past few decades. The total outstanding student debt now stands at a whopping $1 trillion, and consequently, many consumers and policymakers are demanding changes to the cost of the current higher education system. National Public Radio is doing a series titled which examines the affordability of higher education.
A college degree is a proven entry point into the middle class. But for some, the cost of getting a college degree is limiting their choices. In the last five years alone, some states have seen hikes in tuition up to 75%. These escalating costs are happening at private and public colleges and universities alike, so it’s no wonder that the cost of education has tripled in the last 30 years even after adjusting for inflation. These days, roughly 70% of college graduates are strapped with student debt; these chunks of change average about $30,000.
For most families, a college education is one of the biggest investments they will make in their lifetimes – and it should pay off, in terms of lifetime earnings, compared with those who never get a college education. According to this piece in the National Public Radio series, “Paying for College,” college graduates earn $17,500 more a year on average than their high school-educated counterparts. Still, the rising amounts of debt that these graduates take on may undercut those earnings – causing them to delay other purchases like homes, cars, or consumer goods. It puts a damper not only on their finances, but on our national economic growth.
There are voices in the debate who say that the price tag that many institutions place on the cost of college is far above what the average student actually pays, when you factor in financial aid and other discounts that schools may provide to needier students. One opinion piece even claimed that there is a bright side to higher college tuition. However, it can be confusing to navigate the financial aid maze, and many students end up overborrowing to go to college. To learn more about what to consider when paying for college, take a look at our 6 Tips on How to Graduate with Less Student Debt.
Consumers Union has urged policymakers and regulators to make college affordability a high priority, as well as address the student debt crisis and its burden on families. Key to our efforts is encouraging those most affected by this crisis to share their experiences so as to inform our policy work.
How has the rising cost of higher education influenced your decisions about where (or whether) to go to college? Share with us in the comments section.