When students weigh their financial aid options at private colleges versus public colleges, the cost of private colleges can seem to outweigh the benefits. However, students may not be aware that private colleges offered historically high average tuition discounts to students in the 2017-2018 school year, continuing an upward trend and peaking in 10 years, according to a recent survey. The average tuition reduction for freshmen reached more than 50% for the first time in this year’s survey, and the trend is expected to continue in the 2018-2019 school year.
Tuition and fees are generally higher at private colleges, and these institutions may have a reputation for educating only the wealthiest students. But college administrators are hoping tuition discounts and institutional dollars can help tip the scales, luring more students to look beyond sticker prices to take advantage of price reductions.
According to Richard Ekman, president of the Council of Independent Colleges, it is a common misconception that private institutions are not accessible to certain groups, such as low-income and first-generation students.
“Don’t assume that public college is more affordable than private college. In very many cases, private college is much more affordable,” says Ekman. “If you’re a black inner city kid with a B minus average in high school, what are your options for college? Well, you probably think that’s the branch of the state system down the street the closer to home. But, in fact, statistics would show that the best option is a moderately selective private college that may or may not be close to your home.”
The latest report from the National Association of College and University Business Leaders survey shows that from the 2007-2008 to 2017-2018 school year, the share of full-time freshmen who received an institutional grant or scholarship increased from 81.7% to 89.3%.
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But public universities may offer their own draws, including lower tuition, especially for in-state residents. According to 2011-2012 data from the National Center for Education Statistics, a lower percentage of undergraduate students in public four-year institutions take out any type of student loan. About 65% of these students took out loans, while about 74% of private nonprofit college undergraduates took out some kind of student loan.
What is a Private College?
Private colleges are privately funded, with much of their funding coming from donors and tuition fees. These institutions can range from liberal arts schools to fine arts colleges, as well as religious colleges and schools dedicated to a specific field such as medicine or business.
These schools are often, but not always, smaller than public schools, which can result in smaller class sizes. Private schools operate independently, meaning they set their own policies and offerings.
What is a public college?
Public universities and colleges depend on federal, state, and local funding. Historically, states have assumed the bulk of funding responsibilities, but in recent years state funding has declined and federal spending on public colleges and universities has exceeded state funding.
These institutions are supported by taxpayers and often offer reduced rates for in-state residents. Public schools can be much larger and have multiple campuses throughout the state.
Differences Between Public and Private Colleges
Tuition fees are increasing in all areas, both in private and public colleges. US News data shows that in 20 years, tuition at national universities has risen 168% at private colleges, 200% at public colleges for out-of-state students, and 243% at public colleges for state students.
But the cost of tuition and fees at private colleges is typically much higher than the cost at public institutions, according to data from US News. The average cost of tuition and fees in 2018-2019 for a private college was $35,676, which is significantly higher than the average tuition and fees at public universities and colleges: $9,716 for in-state students and $21,629 for out-of-state students.
Big discounts don’t always mean lower fees for families. Students may see larger scholarships from private colleges in their financial aid programs, says Lori Vedder, director of financial aid at the University of Michigan at Flint, but evaluating college financial aid offers private and public is not always an apple against apples. comparison. Vedder recommends that students pay close attention to a college’s tuition and what is and is not included.
“If you look at your son’s or daughter’s award letter and you see that a public institution awards $10,000 for one academic year and maybe a private (college) awards $15,000 for the academic year, you have to look at the cost of attendance and say, ‘How much does it cost to attend this meeting, and what, if any, will be our family’s out-of-pocket?’ “, says Vedder.
Students may notice more institutional grants or university grants funded by local, federal, or state dollars on financial aid award letters from public institutions. Financial aid from private colleges is more likely to include specific donor-funded scholarships than grants from local or state levels.
Before counting any college, Bernie Pekala, director of student financial strategies at Boston College, says students should apply or take advantage of net price calculators, which are federally mandated calculators hosted on websites. colleges to help students estimate the amount of financial aid they may receive. in a given institution. He also recommends that students research the types of aid they receive, including whether the aid comes in the form of student loans, federal work-study funding, or grants and scholarships that don’t have to be reimbursed.
While the average discount rate for full-time freshmen is estimated at 52.2% in 2018-2019, the actual reduction a student sees in their financial aid package can vary significantly, says Pekala. .
“Some students will get a zero reduction rate, others 85% or 95%. So it depends on the student and their situation,” says Pekala. “Looking at these numbers tells you that there is an opportunity. You should not automatically exclude private schools, but your personal circumstances may or may not vary positively as well. I strongly recommend that they also include some public schools in their application and some private schools. to balance them out.”
Are you trying to finance your studies? Get tips and more at US News’ Paying for College hub.