College costs continue upward

Prices are down in quite a few areas of the economy, but not in higher education. Not by a long shot. The New York Times has details from the College Board's latest "Trends in College Pricing" report.

The price of a college education rose substantially last year.... Hit hard by state budget cuts, four-year public colleges raised tuition and fees by an average of 6.5 percent last year. Prices at private colleges rose 4.4 percent....

Patrick Callan, president of the National Center for Public Policy and Higher Education, called the increases "hugely disappointing."...

"It tells you that higher education is still a seller's market. The level of debt we're asking people to undertake is unsustainable," [Mr. Callan said].

With room and board, the average total cost of attendance at a public four-year college is now $15,213, the report found. At private nonprofit colleges, which enroll about one in five college students nationally, the average total cost of attendance is now $35,636.

Over the last 30 years, college costs have risen steadily, especially at four-year public universities, once considered the affordable route to higher education. At such universities, the last decade's increases, adjusted for inflation, have been the steepest.

Interestingly, the rate of price increase at private colleges - presumably a bit more subject to the forces of the marketplace - is slowing a bit. That's also happening at two-year schools.

At private universities and public two-year institutions, the rate of increase has slowed over the last decade. The 4.4 percent rise in tuition at private colleges last year, for example, was smaller than in past years, when it has been about 6 percent.

The latest College Board report on rising prices, combined with market trends that are creating relatively fewer jobs for college grads, is likely to have even more people asking, "Is a college education still worth the investment?"

SMI's October cover story looks at this issue in depth, and offers ideas for reducing the cost of postsecondary education.
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Joseph Slife is a contributing author and editor for SMI. Visit www.soundmindinvesting.com to learn more.