Why Americans are more cautious about the cost of college

[August 17, 2018]   By Gail MarksJarvis

CHICAGO - Since he was in fourth grade, Dennis Nolte’s stepson Jacob has been tacking Massachusetts Institute of Technology posters to his bedroom wall and dreaming of attending some day.

But now that Jacob is 18 and applying to colleges, Nolte has delivered an uncomfortable message: “If manna comes from heaven, and you get enough scholarships, you can go to MIT,” Nolte told him. “Otherwise, getting a good education that’s cheap and affordable in-state makes more sense.”

Nolte, who is a financial planner in Winter Park, Florida, compares the high cost of a private university such as MIT to Florida state schools, where the total cost of tuition, room and board and fees comes in at less than a third of such elite schools.

MIT estimates total costs for its upcoming academic year at $70,240, while state schools in Florida come in at less than $20,000.

With massive media attention on the high cost of college along with lessons of the Great Recession, even people who can afford to pay “are much more circumspect about the cost of college,” Nolte said.

Graduating students arrive for Commencement Exercises at Boston College in Boston, Massachusetts, U.S. on May 20, 2013. REUTERS/Brian Snyder/File Photo

His impressions are borne out in a survey by student lender Sallie Mae released this week. Despite a strong economy, parents and students are far more cautious about paying for college now than they were in the throes of the last recession, according to How America Values College, the Sallie Mae survey of 1,907 parents and students.

About 90 percent of respondents consider college a good investment, but that does not mean attending at any cost.

Some 78 percent of families said they are focusing on the price of a college education. Even before applying for the 2017 school year, 70 percent of students said they discarded colleges because they were too expensive. That is a huge change from 2008, when only 42 percent of students limited pricier choices immediately.

Parents are also taking a tougher line, with 46 percent eliminating expensive colleges at the outset, compared with only 39 percent in 2008.

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