College Tuition Is on Sale!

A recent article showing that private college costs are rapidly approaching $100,000 annually got a lot of attention. The article highlighted a Vanderbilt engineering student's all-in costs of over $98,000, including tuition, fees, room and board, laptop and personal expenses; add a couple of round-trip airfares into the mix and you've likely crossed the 6 figure line.

Here's a more reassuring article: NACUBO's annual tuition discounting survey showed that the average tuition discount rate for full-time first year students at private nonprofit colleges and universities was 56.1% for the 2023-24 academic year. In fact, just over 90% of first year students received some form of institutional grant.

According to the survey, net tuition revenue-- the amount of tuition dollars actually collected by colleges and universities-- was up by less than 1% in the 2023-24 school year compared with the prior school year. That's less than the overall inflation rate, even by pre-2020 standards.

Put in dollar terms, this means that for every $1,000 of list price tuition revenue, colleges only collect around $440. And despite headline news about college costs climbing, the amount of money families pay for college has in fact remained flat for more than a decade.

What does this mean for you? It means that you can find colleges that will discount your tuition through scholarships and grants. What does this not mean? It does not mean that every college you apply to will reduce its tuition by 56% for your student. To find the best deals on tuition, you need to know what types of institutional scholarships you're eligible for-- need-based financial aid, merit awards, or both-- and apply to colleges that offer that type of scholarship.

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