Almost no one really pays inflated college sticker prices–they just make education seem expensive. Now more colleges are getting real about tuition

Sustainable Development Goals (SDGs) and the True Cost of College Education

Introduction

Private colleges often present a confusing and inflated price for their education, which does not accurately reflect the actual cost. This is due to the prevalent high-tuition-high-discount model used by most private institutions. While scholarships and other forms of aid make college appear more affordable, the reality is that very few students actually pay the full tuition amount. The increasing sticker prices of tuition have made it difficult for families to justify the cost of a college education.

The Origins of the High-Tuition-High-Discount Model

This pricing model, now adopted by all but the wealthiest private institutions, was initially designed to make higher education more accessible to low-income students. Some students’ tuition payments were used to offset the tuition costs of needier students. As long as there were enough students paying close to the full price, this system worked effectively.

The Problem with Discounts and Scholarships

However, as the pool of potential students has decreased, colleges have resorted to offering larger discounts to attract more students, including those who may not necessarily require financial aid. When there are not enough students paying full tuition to subsidize others, the scholarships being offered are no longer backed by real dollars. They become mere coupons that make college appear more affordable, without actually contributing to the educational experience. Colleges essentially “buy” students through these discounts to generate revenue.

At many private colleges, student revenue is the largest source of institutional income. However, the high tuition discounts pose a problem. On average, private colleges cut 56.2% of tuition for first-time undergraduate students, meaning they give up $56.20 for every $100 charged. This number is even higher for institutions that heavily rely on discounting to attract students. In fact, budgets are built based on expected net revenue after the discount has been applied.

The Consequences of Runaway Tuition Pricing and Discounting

One of the unintended consequences of inflated tuition prices and excessive discounting is that private colleges appear financially out of reach for many prospective students. Published tuition prices are often the first factor considered by students and their families when making college decisions. If private colleges seem too expensive, they are often disregarded, particularly by Pell-eligible students and first-generation college students who could benefit greatly from the supportive environment offered by smaller private institutions. As a result, these students may choose alternative educational paths or forego college altogether.

A Shift Towards Transparency

Fortunately, some colleges are reevaluating their approach. Institutions like Colby-Sawyer, Lasell, and Wartburg have recently reduced their list prices by double digits. Bridgewater College in Virginia is taking a similar step by reducing its undergraduate sticker price by over 60% to improve accessibility and better reflect the true cost of education.

The Importance of Transparent Pricing

While not everyone needs a college degree to be successful, the majority can benefit greatly from the experience. It is crucial that published tuition prices accurately reflect the actual cost of a college education instead of being part of a convoluted pricing strategy. Students and their families deserve transparency when making one of the most significant investments of their lives.

David Bushman is the ninth president of Bridgewater College in Bridgewater, Virginia.

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SDGs, Targets, and Indicators

1. SDG 4: Quality Education

   • Target 4.1: By 2030, ensure that all girls and boys complete free, equitable, and quality primary and secondary education.
   • Indicator 4.1.1: Proportion of children and young people (a) in grades 2/3; (b) at the end of primary; and (c) at the end of lower secondary achieving at least a minimum proficiency level in (i) reading and (ii) mathematics, by sex.

2. SDG 10: Reduced Inequalities

   • Target 10.2: By 2030, empower and promote the social, economic, and political inclusion of all, irrespective of age, sex, disability, race, ethnicity, origin, religion, or economic or other status.
   • Indicator 10.2.1: Proportion of people living below 50 percent of median income, by sex, age group, and persons with disabilities.

Analysis

The article discusses the issue of college tuition pricing and its impact on accessibility to higher education. Based on the content of the article, the following SDGs, targets, and indicators can be identified:

1. SDG 4: Quality Education

The article highlights the inflated tuition prices of private colleges, which can make college education financially out of reach for many prospective students. This relates to SDG 4, which aims to ensure quality education for all.

2. SDG 10: Reduced Inequalities

The article mentions that the high tuition prices and discounts offered by private colleges can deter low-income students, including Pell-eligible students and first-generation college students, from considering private colleges. This relates to SDG 10, which aims to reduce inequalities and promote social and economic inclusion.

Table: SDGs, Targets, and Indicators

Behold! This splendid article springs forth from the wellspring of knowledge, shaped by a wondrous proprietary AI technology that delved into a vast ocean of data, illuminating the path towards the Sustainable Development Goals. Remember that all rights are reserved by SDG Investors LLC, empowering us to champion progress together.

Source: fortune.com

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