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Guide to the Price of College Over Time

Guide to the Price of College Over Time
Sulaiman Abdur-Rahman
Sulaiman Abdur-RahmanUpdated October 17, 2022
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The cost of college over time has risen dramatically. Since 1980, the price has increased 175%, according to data from the National Center for Education Statistics. The average cost of college tuition, room, and board for undergraduate students in 1980–81 — after adjusting for inflation — was $9,421. Those same costs in 2020–21 rose to $25,910.Read on to learn more about college prices over time and some factors that may be contributing to the growing costs for students.

How Much Has the Cost of College Increased?

College costs have risen steadily through the decades, except for a slight dip in the 1970s. Here’s a look at how college tuition prices over time over time have increased:

1960s

In the 1960s, college costs over time rose at a modest rate. The average inflation-adjusted cost of tuition, room, and board for undergraduate students was $10,648 in 1963–64, and $10,868 in 1969–70, according to the National Center for Education Statistics (NCES). 1963–64 is the earliest school year listed in the NCES data table, which as of October 2022, used 2020–21 dollars to adjust for inflation based on the Consumer Price Index.

1970s

The average cost of college tuition went up and then down in the 1970s, after adjusting for inflation. The average cost of tuition, room, and board for undergraduate students soared to $11,276 in 1972–73, and fluctuated throughout the decade before settling at $9,521 in 1979–80.

1980s

In the 1980s, the cost of college skyrocketed. The average inflation-adjusted cost of tuition, room, and board for undergraduate students was $9,421 in 1980–81, and $12,864 in 1989–90 — a 36.55% increase.

1990s

The price of college in the 1990s rose 25.74% — a slowdown from the 1980s, but still a substantial price increase after adjusting for inflation. The average cost of tuition, room, and board for undergraduate students went from $12,894 in 1990–91 to $16,213 in 1999–2000.

2000s

College tuition costs over time continued to climb in the new millennium. The average inflation-adjusted cost of tuition, room, and board for undergraduate students went from $16,261 in 2000–01 to $21,430 in 2009–2010 — a 31.8% increase.

2010s

The increase in the cost of college slowed in this decade to 17.6 %, but still reached new heights. The average inflation-adjusted cost of tuition, room, and board for undergraduate students went from $21,990 in 2010–11 to $25,862 in 2019–20.

Present

The cost of college tuition today continues to climb. The average cost of tuition, room, and board for undergraduate students rose to $25,910 in 2020–21, which is 0.19% more than the prior academic year after adjusting for inflation.

What Is Contributing to the Increased Cost of College?

These are some of the factors that may be responsible for the growing college prices over time.

More Student Support

Surprisingly, the fact that schools give more scholarships or “tuition discounts” may be one of the reasons why college tuition prices over time generally go up after adjusting for inflation. A college or university might offer discounts as a way of promoting diversity, equity, and inclusion, for example, and raise the cost of attendance.Scholarship opportunities can become more valuable when tuition prices increase. Almost all colleges encourage students to complete and submit a Free Application for Federal Student Aid, also known as the FAFSA® form. Some students may be at risk of dropping out of college if they lose access to school-based aid.The way FAFSA works is that you complete and submit the form to apply for federal student aid. Some schools require that you submit the FAFSA every year to be considered for annual school-based financial aid.Most U.S. citizens or eligible noncitizens are eligible for need-based financial aid for college, according to Federal Student Aid, an office of the U.S. Department of Education. 

Changes in Government Funding

Another factor that may be contributing to the rising college costs over time is changes in government funding. Data show that state and local governments have provided less and less funding to public colleges and universities after adjusting for inflation.A May 2021 report by the State Higher Education Executive Officers Association (SHEEO) found that public colleges and universities had received a lower amount of state aid per full-time equivalent student in 2019 than in 2001 after adjusting for inflation. Full-time equivalent or FTE students are those who attend school with full-time credit hours.
  • In 2001, public colleges enrolled 8.7 million students and received $82.6 billion in general state aid ($9,547 per FTE student)
  • In 2008, public colleges enrolled 10.2 million students and received $85.6 billion in general state aid ($8,377 per FTE student)
  • In 2019, public colleges enrolled 10.9 million students and received $80.8 billion in general state aid ($7,388 per FTE student)
Public colleges and universities may raise their annual tuition costs as a direct result of receiving reduced amounts of state support after adjusting for inflation.

Increase in the Cost of Education Services

The rising cost of providing educational services may also play a role in the growing cost of college over time. Colleges face a number of operating expenses, including salaries, wages, staff benefits, supplies, equipment, and utilities.Tuition and fees are a primary source of revenue for colleges and universities, and tuition increases may be necessary for schools to operate. Some students may be eligible for federal Pell Grants that can help them pay for the rising cost of college.

Increased Demand

The number of full-time students enrolled at public colleges increased from 8.7 million in 2001 to 10.9 million in 2019. Educating a larger number of students can strain a school’s budget if operating cost exceeds the revenue it generates.  A greater demand for higher education services may be a factor behind the growing college tuition costs over time.

5 Ideas to Afford College

Here are ways to help make college worth it and more affordable:

1. Scholarships and Grants

Schools, private companies, and nonprofit organizations may offer scholarships to help students pay for the cost of college.The federal government, states, and school associations may offer grants based on financial need. Scholarships and grants can also be helpful if you’re seeking a second bachelor’s degree.Students typically don’t have to repay scholarships or grants. In some cases, however, students may have to repay part of a grant or scholarship if they failed to honor the terms and conditions of the financial aid.

2. Work

The following employment opportunities can help you pay for the cost of college: 

Work Study

Students eligible for the Federal Work-Study (FWS) program may work part-time jobs. Those wages can cover college-related expenses. Unlike student loans, money earned from the FWS program doesn't have to be repaid. 

Other Part-Time Work

If you’re not eligible for Federal Work-Study or you want to explore different opportunities, you may consider other part-time gigs, including remote jobs for college students. You can use the income from an online part-time job to help pay for your college-related expenses.

Summer Work

Being enrolled as a full-time college student during the fall and spring may give you the incentive to work a full-time summer job. There are a number of summer jobs for college students that can be rewarding in more ways than one. Work experience can broaden your resume and give you the chance to build a professional network while developing skills and earning money.

3. Financial Aid

Financial aid for college can include scholarships, grants, and federal student loans. When using student loans, you can spend the loan proceeds on tuition and fees, rent and utilities, living expenses, and supplies for college.

4. Student Loans

Students can borrow federal or private student loans to help pay for the cost of college. The difference between private and federal student loans is that federal student loans are provided exclusively by the U.S. Department of Education. Banks, credit unions, online lenders, and select state-based or state-affiliated organizations may offer private student loans.Borrowers are generally expected to repay their education loans over time, and there are different student loan repayment options.  The average student debt in the US is tens of thousands of dollars, according to the Education Data Initiative. Researchers from that group found that the average federal student loan debt in 2021 was $36,510 per borrower, while private student loan debt averaged $54,921 per borrower.

5. Tuition Reimbursement

If your employer offers tuition reimbursement, you may receive up to $5,250 in annual educational assistance that is not subject to federal income tax. Employers can offer any amount of tuition reimbursement assistance, but you may have to pay federal income tax on any educational benefits above $5,250.

The Takeaway

The cost of attending college has skyrocketed since the 1980s. One contributing factor is that for many years, public colleges have received declining amounts of state aid after adjusting for inflation. While one-time student loan forgiveness programs may help students reduce debt, there are other ways to help pay for the cost of college including Federal Work Study, tuition reimbursement, student loans, and scholarships and grants. You can explore different options to help pay for the cost of college to find the best ones for you.

3 Student Loan Tips

  • Refinancing your student loan can lower your monthly payments and help you adjust your loan term. Compare student loan refinance rates to find a loan that works for you.
  • Paying extra each month on your student loan can reduce the interest you pay and so lower your total loan cost over time. (The law prohibits prepayment penalties on federal or private student loans.)
  • Depending on their income, qualified borrowers can deduct the interest they pay for student loans, both federal or private, up to $2,500 per year. The deduction phases out for modified adjusted gross incomes of $70,000 to $85,000 for single individuals and $140,000 to $170,000 for people married and filing jointly.

 Photo credit: iStock/Prostock-Studio
The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.LCSL0822001

Frequently Asked Questions

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About the Author

Sulaiman Abdur-Rahman

Sulaiman Abdur-Rahman

Sulaiman Abdur-Rahman writes about personal loans, auto loans, student loans, and other personal finance topics for Lantern. He’s the recipient of more than 10 journalism awards and currently serves as a New Jersey Society of Professional Journalists board member. An alumnus of the Philadelphia-based Temple University, Abdur-Rahman is a strong advocate of the First Amendment and freedom of speech.
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