It used to be a clever marketing tactic for colleges to increase their cost of attendance incrementally. In marketing psychology, companies are willing to raise their price tag to associate their service with higher quality. However, it seems private colleges have now taken the Chivas Regal effect past its limit.
Today, nearly one-third of parents and students believe that a college education is overpriced, and 81% of families crossed a school off their list at some point due to cost, according to a Sallie Mae and Ipsos study. The published sticker price is now over $57,000 on average, nearly 20% more than the 2006-07 academic year, according to a report by College Board.
“You see these headlines of college prices skyrocketing, that sort of thing, you know, it sends a message to low-income families that college is unaffordable,” said Jill Desjean, senior policy analyst for the National Association of Student Financial Aid Administrators, according to The Hill.
Private colleges have inadvertently created a narrative that a degree from their institution is too burdensome despite the measures they’ve taken to make college more affordable. The net price for private colleges has fallen by 11% in five years once adjusted for inflation, and the grant aid offered per student on average in the 2022-23 academic year covered 43% of the sticker price.
How can colleges reveal their true cost?
Small private colleges are beginning to respond by implementing “tuition resets” on their sticker price, according to The New York Times. For example, Houghton University (N.Y.) now markets itself as the best-priced Christian college in the nation with its tuition cut. The same goes for Washington & Jefferson (Pa.) and Colby-Sawyer (N.H.).
Schools can also market the Department of Education’s net price calculator. However, Michele Shepard, senior director of college affordability at The Institute for College Access & Success, finds the information challenging for students to interpret since “There’s no standardization across how colleges communicate their numbers.” Although the Higher Education Opportunity Act mandated institutions to publish students’ net prices based on their circumstances, most are difficult to use and find.
Another software colleges can help promote is MyinTuition, which helps simplify the numbers.