Are Colleges And Universities Really That Expensive?

Colleges are expensive, yes. There is little doubt about that. However, what we often don’t talk about are the other expenses associated with being a college student these days. The “other expenses” are as “expensive” as college itself, I say.

College tuition where I work at costs students $7,700 in tuition a year before room and board is added to the bill. Not a bad price in today’s market, is it? Since young adults have to pay rent and eat whether they are college students or not, I will not talk too much about housing and meal plans in this article. By taking this fair metric, college costs are really then the price of tuition, student fees and books which again, I believe is the true costs of education in the United States.

For the sake of simplicity, let’s assume that college students at university A spend 9K a year in “college only” expenses totaling a lifetime college investment of 36K. Is it little money? Of course it isn’t but this value isn’t that far off from what the market will pay recent graduates when they leave the university with a degree in communications, on average. I predict student value after graduation to be between 28 to 32 thousand dollars in medium size to large cities, by the way. 

So in reality, students aren’t really making a very bad investment by going to get a college education with a 4 thousand dollars upside down in loans over a period of 15 tears. It is is, in reality, a negligible value, especially in the long run. I would be much more concerned if the value of tuition was 26 thousand dollars in tuition a year. 

Look, my problem with this debate isn’t necessarily with the price of tuition. I agree that tuition is expensive. My problem is with constituents who talk about the large debt that students accrue without taking into account the brand new (or used) car payments they have, car insurance policies, speeding tickets received, gasoline, smartphone bills, clothes, beer… College student debt is much more than just college tuition. 

Today in my office, I calculated the “college expenses” of a student totaling 10 thousand in extras! How fair is it to say that college is bankrupting students when students themselves spend that amount of money in unrelated college expenses or more every year? Let’s not forget that folks can always find an on-line education option so driving shouldn’t be an excuse to have a car payment. The truth is that the cost of tuition is as much of a problem to the debt crisis as how misinformed our kids are when going to college. 

Unfortunately, our students will spend four to seven years of their lives in college living life as an adult and fifty to seventy years of their adult living as a poor college student. It’s tragic but I think it will happen. College students are also part of the problem (perhaps their parents) as they spend a lot of money in expenses that simply don’t matter.

College students need, more than ever, mentorship in finance and a big wake up call. I help my advisees and clients to save money during their four years of college. We are lacking caring professors who tell the students the things they need to know for life and students who are willing to look beyond the obvious and critically investigate their own circumstances in life. I took the stance to be pro-students but that’s just me. I do realize that my motto of “If you do what is best for the students, you will do what is best for you” isn’t for everyone but at least it should be considered as an option by many in higher education.

Take the lead and help students to realize that they are also part of the problem when it comes to student debt. They need to know that there are other costs in addition to student tuition. Smartphone fees, having the newest iPhone, car payments, insurance, gas… are optional. 

Colleges are expensive, of course! Let’s not ignore the fact that we have a 3% to 4% inflation a year, plus depreciation of currency, and miscellaneous cost in addition to tuition price, making this crisis in education more than just the price of tuition alone. Think about it.