We regularly hear from the media that the cost of higher education and the resulting levels of student debt have grown to such enormous proportions as to spell certain doom for young people, families and indeed the entire nation. Some critics say student loans will be the next financial “bubble” to burst, and that borrowing money to pursue a college degree is no longer worth the risk – especially for those attending private institutions.
What is not often told is that private nonprofit colleges have worked hard to reduce costs for students. According to recent studies by the College Board and the National Association of Independent Colleges and Universities, net tuition at those institutions has actually dropped by 4.1 percent over the past five years.
The College Board also reports that thanks in large part to increases in institutional student aid, the average net cost at private colleges – what families actually pay – is around $12,900. That’s not much different from the cost of four-year public universities.
Another issue is that some stories in the media misrepresent the debt load of students, particularly at private schools. Some center on an “example,” such as a graduate with a degree in religious and women’s studies and $100,000 of debt. A more accurate picture, based on recent research by the College Board and the Council of Independent Colleges, is that the average student debt load at graduation is about $23,000. A report by the Association of American Universities puts the median balance closer to $13,000, suggesting that “the average is being pushed higher by a relatively small number of borrowers with very high loan balances.”
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Indeed, the AAU found that close to 40 percent of recent public university graduates and 30 percent of recent private university grads left college with no debt. Of those who had debt, 43 percent owed less than $10,000, and 72 percent owed less than $25,000. Only 3 percent of graduates owed six-figure amounts.
Misconceptions or myths about student debt can discourage students from seeking out the college or university that is right for them. One is the myth that only wealthy families can afford to send their children to independent colleges. The truth is that private colleges enroll low- and middle-income students at about the same percentages as public institutions. Another myth is that it is very difficult to receive financial aid at independent colleges. The real story is that a larger percentage of students at private colleges receive financial aid than students at other types of institutions.
I was a first-generation college student whose father was a steelworker. There were no reserves for college in my family. When I graduated in 1975, I owed $10,000 in student loans (the equivalent of $42,650 today). It took me 10 years to pay off my loans, but it’s the best investment I ever made.
I urge readers to be skeptical of overblown statements about the cost of higher education. Families, do your research on the schools of interest to your sons and daughters, and then explore all the ways those institutions work to make their programs affordable and accessible.
As president of a Catholic, private nonprofit university, I can attest that we want students from all income levels to be able to attend Newman University or whatever institution seems the right “fit” for the student.