How much could a 4-year degree cost for the next generation?
The cost of attendance for college students pursuing a 4-year degree in the US has approximately doubled in the past 20 years. However, signs of slowing growth rates over the past several decades indicate the future price tag at America’s higher education institutions may be lower than previously expected.
Making the decision to pursue a bachelor’s degree comes with a certain amount of financial burden for most students. The current student debt level is $1.5 trillion, according to the Pew Research Center. For parents of newborn children, it may seem unfathomable to think about how much it will cost for their child to achieve their higher education dreams, but the average change in tuition rates is actually slowing down.
*Cost of Attendance includes: Tuition, fees, room, and board (room and board data are estimates)
The cost of attendance has historically increased at some rate every year since 1963, the entire timeframe studied in a statistical analysis done by the U.S. Department of Education, National Center for Education Statistics. Most importantly, the percentage rate has been decreasing on average for the past four decades, spanning from 1977 to 2017.
A drop in the rate of change doesn’t mean a drop in price, which has been consistently increasing. This means the cost of attendance is going up less and less on average over time, as an overall percentage of the cost.
It would be interesting to see where this trend leads, as the total amount of money students pay to go to college will most likely not plateau off at some stable level in the long-term. However, smaller percentage increases are apparently needed to fund educational institutions, perhaps due to more efficient fiscal budgeting, advancements in technology, and more students attending college, creating economies of scale for schools.
So, what will the cost of going to college be for the next generation of 4-year degree seekers? Based on the average percent change in the cost of attendance over the previous 21 years analyzed by the US Department of Education, obtaining a bachelor degree for the class of 2038 could cost approximately $54,283 for public institutions, $97,725 for private institutions, and $68,571 for all institutions nationwide.
The decreasing change in the cost of attendance in the US is a positive sign for younger students thinking about taking the next step in their academic journey. Although it may seem worrisome for parents and students to plan on footing the bill for college, the relative cost of attendance for students in future generations could become more manageable.
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Sources
U.S. Department of Education, National Center for Education Statistics (2019). Digest of Education Statistics, 2017 (NCES 2018-070), Table 330.10 https://nces.ed.gov/programs/digest/d17/tables/dt17_330.10.asp
Pew Research Center (2019). 5 facts about student loans, https://www.pewresearch.org/fact-tank/2019/08/13/facts-about-student-loans/