College prices continue to increase at a moderate pace, and student aid remains stable according to the College Board’s 2015 Trends in Higher Education reports–Trends in Student Aid and Trends in College Pricing–released today. Tuition and fees continued to rise this year at a rate similar to that of the last two years, while lower inflation made these increases larger in real terms. Continuing the post-recession trend, borrowing per student declined for the fourth consecutive year and was 10% lower in 2014—15 than in 2010—11.
When accounting for grant aid, the prices typical students paid for college fell in all sectors between 2005—06 and 2010—11, but have risen since then. On average, full-time students at public two-year colleges pay $1,140 less in net tuition and fees–and $430 less in net tuition and fees and room and board–in 2015—16 than they did a decade ago. At private, nonprofit, four-year institutions, the estimated net tuition and fee price is just 1% higher in 2015—16 than a decade earlier. However, because of recent increases, public four-year college students pay net prices averaging 38% more than they did 10 years ago.
“These data provoke a necessary conversation about college financing,” said Jack Buckley, senior vice president of research at the College Board, in a release. “As the price of postsecondary education continues to rise, we need innovative thinking around federal, state, and institutional aid that will allow all students and families to feel confident that they will be able to pay for college. The College Board will continue to present the most transparent and relevant data so that policymakers and researchers can understand how to evaluate and address this nationwide challenge.”
The average published tuition and fee price is 40% higher in 2015—16 at public four-year institutions than it was in 2005—06, 29% higher in the public two-year sector, and 26% higher in the private, nonprofit, four-year sector. However, the report finds that these price increases are smaller than in previous decades.
“The post-recession trends we documented last year have continued, with price increases that are moderate by historical standards and with continuing declines in student borrowing” said Sandy Baum, senior fellow at the Urban Institute, in a release. Baum is also a research professor of education policy at the George Washington University Graduate School of Education and Human Development, and a co-author of the 2015 Trends in Higher Education reports. “However, the reports also document dramatic increases in published tuition and fees over time, as well as increases in net tuition and fees in the past few years, resulting from the combination of published prices that continue to rise and student aid levels that have not kept up. Ensuring that our nation continues to provide access to affordable education for all who can benefit is a prerequisite for a healthy economy and society.”
The Trends in Student Aid 2015 report also shows that student borrowing continues to decline. Total education loan volume declined by 6% in 2014—15, and was 14% lower than in 2010—11. Average federal loans per undergraduate student also declined by 6% in 2014—15–and by $870 (in 2014 dollars) over four years.
The report highlights differences in debt levels and in default patterns among different groups. Students who do not complete their degrees default on their student loans within two years of beginning repayment at almost three times the rate of those who graduate. Independent students, students who take longer to earn their degrees, and those who attend for-profit institutions are among those who accumulate the most debt for their undergraduate degrees. Among other key findings:
- In 2013, households currently in the top quartile of the income distribution held 47% of outstanding education debt; those in the lowest income quartile held 11%.
- In 2015, 3.9 million federal Direct Loan borrowers were in repayment plans that limit their payments to a specified percentage of their incomes. These borrowers constituted 20% of those in repayment plans; they held 37% of the total outstanding debt in repayment plans.
- Loans issued to students enrolled in for-profit institutions increased from 13% of total outstanding federal student loan balances in 2003—04 to 21% in 2013—14.
- Among borrowers who entered repayment in 2011—12, 9% of those who completed their programs and 24% of those who did not graduate defaulted on their student loans within two years of entering repayment.
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