By Betsy Prueter
A recent report from The Century Foundation argues that colleges and universities often minimize the full cost of attendance for students (cost of attendance means all associated costs of enrolling, including living costs and text books), which often results in preventing students from receiving the full amount of financial aid for which they are eligible. Alongside this trend, financial aid has not kept pace with increasing tuition and non-tuition expenses which places a significant financial burden on students, particularly low-income students. The report claims that the Expected Family Contribution (EFC) miscalculates and overestimates some families’ ability to pay because it doesn’t take into account certain types of debt, certain family dynamics, or other circumstances.
Among the other primary findings:
- Students are seeing increases in what they have to pay out-of-pocket and are cutting back on basic necessities to make ends meet.
- 40% of students studied in the report saw an increase in their share of the tuition bill going into sophomore year- a median increase of $1,215.
- This number increased again between the sophomore and junior years.
- Average sticker prices and net prices have increased in the last 10 years across all institutions; at community colleges sticker prices have increased by about 20%.
- In general, net prices for low-income students have increased slightly, by 5%.
- In general, moderate income students saw a 12% increase in net price during that period and middle and upper income families saw a 20-23% increase in net price.
- Colleges may not be calculating cost of living accurately. Numbers are based on what students are spending, instead of what students need to spend. The report reveals many students are scrimping on expenses like food and healthcare in order to get by.
- Though many students are living at home, they may not be receiving any real financial “break.” 70% of students who live at home while attending college are helping pay expenses of the household. However, living at home means a reduction in financial aid, possibly creating even more of a financial strain for living-at-home students.
- Financial aid and cost of attendance are not calculated by major but the reports points out that some majors have additional student costs (e.g. nursing lab fees) that are not taken into account and may make students switch majors or drop out of school all together.
- The report concludes with a recommendation that the U.S. Department of Education develop a “recommended method” to calculating living costs that all institutions use.