College tuition: The folly of paying too much

Many families act as if money were no object when choosing a college, said Candice Choi in the Associated Press. A recent study by Sallie Mae found that 40 percent of families don’t limit their college searches based on total expenses. Most don’t consider their children’s eventual expected earning power when weighing school costs, either. The actual price of any given school, in fact, can vary greatly, depending on whether a student qualifies for financial aid. Still, for too many families, picking a school is “very much an emotional decision,” rather than a rational one.

For more than two decades, college tuition has been rising at a faster rate than that of any other major product or service, said Penelope Wang in Money. While increased demand for degrees may account for some price inflation, major colleges and universities are also simply capitalizing on consumer psychology. “As counterintuitive as it seems, schools have often found that raising tuition attracts more applicants because families tend to equate high price with quality.” The true value of education is impossible to quantify, but independent studies show that even brand-name degrees don’t necessarily translate to big bucks after graduation. “From a purely economic point of view, the best advice might be this: Save your money; you’ll need it for graduate school.”

Some students are now compressing their college careers into three years in an effort to save money, said Tracy Jan in The Boston Globe. Many students on this three-year plan come from middle-class families that don’t qualify for aid and struggle to pay tuition bills. Moving on the fast track can save tens of thousands of dollars. While such students typically start college with a “slew” of Advanced Placement credits that put them ahead of their peers, some schools are also adopting policies that make it easier for anyone to graduate early. An accelerated education may be demanding, but experts see it as a feasible solution for soaring school expenses. “It’s not just another year they don’t have to pay,” says Barbara Brittingham, director of the higher education commission for the New England Association of Schools and Colleges. “It’s also another year to earn.”

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