Smart College Savings

College Expense Keeps Climbing

The College Board bings the bad news: the college bill just keeps growing at around 6% a year. It is certainly not good news for parents with young children, and underscores the importance of savings early and more for college.

Published tuition and fee charges at four-year public colleges average $5,836 in 2006-07. There was a $344 increase over last year, which represents 6.3 percent, or 2.4 percent after adjusting for inflation. The average total tuition, fee, room, and board charges for in-state students at public institutions are $12,796.

After grant aid and tax benefits are considered, full-time students enrolled in public four-year colleges and universities pay on average about $2,700 in net tuition and fees. After declining or just keeping pace with inflation each year between 1996-97 and 2002-03, the average net price students pay at public four-year colleges has increased even more rapidly than published prices for the past four years because grant aid has not kept pace.

Published tuition and fee charges at four-year private colleges average $22,218 in 2006-07. The $1,238 increase over 2005-06 represents an increase of 5.9 percent, or 2 percent after adjusting for inflation. The average total tuition, fee, room, and board charges at private four-year colleges and universities are $30,367.

Full-time students enrolled in private colleges and universities pay on average about $13,200 in net tuition and fees after grant aid and tax benefits. Because of growth in grant aid and tax benefits, the net price students pay has increased more slowly over the past decade than the published price.

Published tuition and fee charges at two-year public colleges average $2,272, $90 more than last year. The 4.1 percent increase is less than one-half of one percentage point above the rate of inflation. After grants and tax benefits are considered, full-time students enrolled in public two-year colleges and universities pay less than $100 on average in net tuition and fees. After adjusting for inflation, the net price students actually pay is lower in 2006-07 than it was a decade earlier.