Public or Private College? Getting the best return on your investment.

As parents and students look at the rising costs of higher education, order many have debated whether attending a private university in California is worth the expense. Here are some factors to consider:

Fact or Fiction?
Public Universities + Grants + Loans = Affordable Opportunities

Community colleges are seen as opportunities for immediate career placement, story or cost-saving measures for students with ambitions to transfer to a four-year institution. The total average cost of completing an AA degree in two years at a California community college was estimated to be $5,000. Students see this as an affordable opportunity to achieve a meaningful income.

For undergraduates considering the CSU or UC system, there is a wide-spread belief that they save on cost in the long-run versus a private education. Publicized access to grants and loans coupled with projected overall cost of attendance by the CSU and UC systems creates this expectation.

What are the financial risks of enrolling in a public institution?

Public colleges and universities are frequently targets for state cost cutting. California has seen a $1.5 billion cut to higher education between 2007-2008 and 2011-2012.

These cuts are significant and:

  1. Impact ability to offer merit scholarships to students
  2. Increase tuition rates on students, both in-state and out-of-state
  3. Reduce the size of faculty
  4. Create a shortage of class offerings year-round
  5. Generate large class sizes
  6. Result in longer delays to graduation

Students in public institutions are acquiring more risk and debt than anticipated.

Theoretically, students attending a community college should be able to complete their degree or transfer in as little as two to three years.

According to EdSource.org, only 52% of students in the California community college system seeking a degree, certificate or transfer, succeed after SIX years (spending an additional average $15,000 or more).

Some reports show completion rates taking as long as EIGHT years.

The National Center for Education Statistics shows an average matriculation rate for students starting at a four-year public institution is 72 months (six years) from first year of enrollment.

 

Private vs Public Grad Rates

© Independent California Colleges & Universities (AICCU), 2013

 

Aside from delays in graduation, students must work harder to be their own skilled advocate and find the external support they need to attain their degree goals. This includes ongoing access to information and advising on financial aid procedures and career mentoring. Transfer students also must keep up with changing admission standards for four-year colleges to acquire the necessary prerequisites to transfer (i.e. specific class units or an AA degree). This can sometimes be the biggest challenge. Many transfer students find that not all their coursework credits from their community college are equal to the coursework credits of the four-year public school counterpart. Private colleges have more flexibility on transferable coursework than the UC’s or CSU’s do.

Fact or Fiction?
Private Universities + Grants + Loans = Costly Opportunities

VIDEO: 9 Myths about Private Nonprofit Higher Education

Publicized access to grants and loans coupled with projected overall cost of attendance at private universities often creates “sticker shock”.  Although the initial shock gives the impression private education is too costly, it may be the more affordable option.

Oftentimes the published rates are rarely what students end up paying. According to the Council of Independent Colleges:

“Independent colleges and universities give students more than six times as much grant aid as does the federal government”.

Private universities are constantly working to find the best incentives for their students. They want to create lasting relationships. Whether you are a first-generation student, a top achiever or a high-need student, private universities invest time and resources to get to know you and to ensure that hard work outside the classroom is equally acknowledged when awarding scholarships.

Undergrads Receiving Financial Aid- Independent Colleges source

© The Council on Independent Colleges, 2013.

Discount Rates for Private UniversitiesThe key to getting the most for your money is to inquire with the private universities about scholarships, grants and discounts available to you.  Search outside scholarships.

Most private universities have the flexibility of offering an average tuition discount rate of 45% (sometimes more) to help offset the cost of your private education.

As a result, nearly one-third of bachelor’s students were able to graduate without any educational debt in 2012.

At the graduate level, the average student loan debt accrued is $22,380 – about $4,000 less than the national student debt level quoted by the Obama administration.

What are the risks with enrolling in a private institution?

Private universities may at times change their discount rates for various reasons, they do not however, run into the same issues that public institutions often face with state cost-cutting measures. Be sure to inquire with the Financial Aid Office for opportunities available to you.

Fewer years of paying tuition often means a quicker start at earning a salary.

According to the National Center for Education Statistics, the average graduation time for students in private universities is 50 months (4.2 years) from start to finish.

When calculating the true cost of college, it is important to consider the opportunity cost of delayed income in addition to the potential expense of an extra semester or year.

How private universities benefit the student:

  • Getting into classes = finishing sooner
  • Relevant majors + internships = great jobs
  • Small class sizes = personal attention
  • Guaranteed one-on-one advising = quality education

Consider if you graduated in four years instead of six, you could potentially be making $40,000/year, times two years, and be $80,000 ahead!

Note to Transfer Students:

Private universities each have their own transfer crediting methods. Some universities don’t require an AA degree completion to start classes, others may not allow you to retain all the credits earned at the community college level.

Check with an admissions counselor to ensure your classes are transferable. Click below to set up an appointment.

FREE Transfer Credit Evaluation

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