In the past three decades, college costs have risen significantly faster than inflation and are now at roughly 25 percent of the average household's income. This isn't true just for private schools. According to "The Great Cost Shift," a recent report by Demos, prices for tuition and fees at public, four-year universities more than doubled between 1990-1991 and 2009-2010, rising by 112.5 percent, while prices of two-year colleges rose 71 percent.
So what's causing tuition to rise at such a rapid pace? A major factor in tuition increases at public institutions has been the withdrawal of state and local funding.
According to "The Great Cost Shift," states' disinvestment in public institutions over the past two decades has resulted in "an irreversible slide of U.S. higher education being a collectively-funded public good to that of an individually purchased private good."
The report, which examines the impact of states' reduction and restructuring of financial support, is chock-full of statistics. Below is some of the more striking information:
In addition, the financial aid system has failed to keep pace with escalating costs, forcing students and their families to rely on financing strategies that reduce their odds of completing school.
[Find out how to finish community college.]
As the report explains:
"The tuition solution is an imperfect one. Because state appropriations generally contribute a much larger share of public university revenue than tuition, any specific percentage reduction in state aid requires much larger percentage rises in tuition. Such increases price low- and moderate-income students out of higher education (while also eroding state support for higher education).
"Educational quality may erode, and some students forego higher education entirely."
So as you can see, it's not so easy for students to obtain a higher education without borrowing, and many factors are contributing to the dilemma. The Student Loan Ranger believes we all must recognize that students who are seeking this education are doing so at a much higher cost than in the past and are forced to find ways to pay.