Rising Costs of Colleges Burden Families

Families in New England are spending a third of their annual income on college expenses—including tuition, other required fees, and living—according to a study conducted by Bridget T. Long, associate professor of education and economics at the Harvard Graduate School of Education.

The study, “Paying for College: The Rising Cost of Higher Education,” found that college related expenses have increased by 7 percent since the 1992-1993 academic year.

Co-sponsored by Massachusetts Institute for New Commonwealth (MassINC) and Blue Cross Blue Shield of Massachusetts, the study also noted that families are paying more for public colleges, from 18% of their income in 1992-1993 to 21 percent in 2003-2004. Ian A. Bowles ’87, President and CEO of MassINC, says that his company decided to sponsor this study because MassINC’s focus is on the “challenges the average Massachusetts family faces in terms of trying to live the American dream” and a number of people raised the rising costs of college as a concern.

Long believes that much can be done to alleviate the situation so that families are not faced with as high costs and more students can acquire degrees.

“The state government has a huge responsibility in helping the public institutions by providing a steady stream of appropriations,” said Long. “Colleges also need to consider how to cut costs on ‘back of the office’ functions by consolidating certain operations.”

The result of this increase, especially in the private college sector, is that families are forced to take more loans and are facing greater debt afterward.

The study showed that students at Massachusetts private colleges face an average debt of $23,491 at the end of college, a 49 percent increase from the 1992-1993 academic year.

Similarly, students at public colleges in Massachusetts face an average debt of $15,399, a 39 percent increase from the 1992-1993 academic year.

The big jump in college costs and, therefore, debt, has forced many students to drop out of college before getting a degree—the six-year graduation rate at UMass-Amherst is 62 percent for students who enrolled in 1998. The number decreases at other UMass campuses, with UMass-Dartmouth at 50 percent and UMass-Boston at 28 percent.

However, Long added, the onus is also on families to plan ahead for their children’s education so that they are not faced with loans and are, in some cases, forced to drop out.

“Families need to take advantage of saving options such as 529 plans,” Long said.

Bowles, who received his College degree in economics, believes that Harvard is taking huge strides in helping families who cannot afford the rising costs of college.

“Harvard has a long and rich history of strong grant aid and need based aid. Harvard is historically a leader in this area,” he said. “A lot of institutions could be more transparent about college costs and what money is being spent on. Harvard, too, could do more in terms of its transparency and a lot of other universities would follow its leadership.”