Four Ways Colleges Can Cut Costs for Students

By ColumnsFOXBusiness

Future college students looking at a difficult job market and staggering student loan debt levels may be rethinking the value of a degree, especially as colleges continue to increase overall costs.

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According to the College Board, the overall average cost to attend an in-state public college for the 2012-13 academic year for students who don’t receive any financial aid rose 3.8% to a record $22,261, with tuition accounting for about half of that increase.

The report also shows that public university tuition and fees alone rose 4.8% to $8,655 and climbed 4.2% at four-year private schools to an average of $29,056 this year.

In response to the rising costs, a Pew Research Center poll shows that 75% of the public says most people cannot afford to pay for a college education, especially with the average amount of student loan debt for a bachelor’s degree at an all-time high of $23,000.

If colleges don’t address the issue of affordability, students may opt out of getting their degree resulting in extreme declines in enrollment, warns Jonathan Robe, research fellow for the Center for College Affordability and Productivity.

“Some midlevel bachelor’s liberal arts colleges or even some public midlevel master’s universities may be forced to drastically change their model of operations or even go out of business,” he says. “There has been some talk that some of these schools may not have a sustainable trajectory.”

To make an education more attainable for students, here are four ways colleges can keep students’ costs lower and boost the value of their degrees.

Make it easier for students to calculate costs. Colleges and universities are now required to post a net price calculator on their website to provide an estimate to current and prospective students based on their family’s circumstances.

Although school calculators can help families decide whether a school is affordable, colleges can take more steps to make the cost more readily available, says Francine Block, college admissions consultant for the American College Admissions Consultants.

“If you go on a college website, they don’t pop up for you—you really need to go looking,” she says. “Now that colleges have required it, it’s there but it’s not always as accessible and understandable for the families, and the colleges are still playing with it a little bit.”

Streamline the transfer process. Many schools have articulation agreements with community colleges to help students’ credits transfer, but the process isn’t always efficient and can result in students taking additional time and money to make up for lost credits, says Robe.

“There are a lot of problems that need to be addressed in terms of easing the transfer process and certainly we would want students to be able to as long as…they have mastered the material at community college and they are ready for four year level work--we shouldn’t penalize them by requiring them to take additional courses or an additional year,” he says.

Block explains that schools can expand their acceptance of articulation agreements beyond the community college down the road.

“They don’t have to be just within state--it can be within a geographic area but not just staying in state and I definitely think that’s something that they should be doing.”

Curb lavish spending on facilities. In the wake of decreased endowments, colleges and universities curbed some million-dollar renovation projects but they are still competing against each other for prospective students, says Block.

“The building wars that are going on, from the highest climbing walls or the dorm facilities--they are trying to please this generation as opposed to educating them at some point,” she says. “I have students who come back and say, ‘the dorms weren’t nice and the lab wasn’t new,’ and that’s because schools have gone out and spoiled the kids with all of these facilities.”

Randolph Lowry, president of Lipscomb University, explains that despite being far beyond the basics of education, many colleges are merely keeping pace with what students and families are demanding.

“One of the reasons that these places are so expensive is when you’re talking about a full service university, we have to essentially fund a small city,” he says. “We’re not in the business of making money off of this—we try to figure out how to pay for it every year and anything that is extra, we put back into next year.”

Offer more three-year degree programs. Lowry claims more colleges are exploring ways to get more students earning a bachelor’s degree more efficiently, particularly through offering three year degree programs.

“They can finish in three years and they have about $10,000 [saved] in costs and more significant, they get into the work force an entire year earlier, so that can be $50,000 or $60,000 [saved].”

Block points out that although more colleges could stand to offer three year programs, it is also up to the student to work harder and possibly attend school over breaks.

“In many cases, it’s taking five courses per semester versus four and it’s also a matter of maybe getting one or two summers,” she says. “Some schools charge per course and others charge a flat year tuition and if you’re charging a flat year tuition and a student is able to get in 10 courses instead of eight, it can speed up their graduation.”