Running Head: DEALING WITH INCREASING TUITION COST

Dealing with Increasing Tuition Cost Nilsi Godo Oakland University

Author Note Nilsi Godo, Computer Engineering Student, Oakland University Michigan. This paper was written for WRT160, Section 064, taught by Professor Marilyn Borner.

DEALING WITH INCREASING TUITION COST

Abstract The increase of tuition price is an issue that affects both students and their families. Even though the economy has seen increasing rates of inflation, the increase of college tuition prices has seen a higher increase. This fact shows that tuition has become less affordable for students and their families. This history of ongoing increases should be matched with different steps to make education more affordable. In order for both the student and the students family to be able to afford the cost of tuition, they should start saving a higher percentage of their income to help pay the higher education cost. Another solution is attending a less expensive university without compromising the quality of education. All these steps should be paired with healthy spending habits from the student, to help him stay debt free even after graduating college.

DEALING WITH INCREASING TUITION COST

Dealing with Increasing Tuition Cost Introduction Just like pre-calculus is a prerequisite for any engineering major, so is a college degree to a good job. The bad news is that college tuition prices have seen a steady increase over the years making it harder for students and their families to afford higher education. In 2006 alone, the tuition cost for attending college in the state of Michigan increased by 7.9%. This increase was necessary even though the state of Michigan boosted funding to universities by 3% (WalshSarnecki, 2006). Since we cant really see where all the money from the tuition goes, we dont believe the rise of school tuition is necessary. What we dont seem to think of is that universities cant compromise the quality of their students education, hence resulting in an increased cost of attending college. Literature Review Due to the little knowledge of how universities work and how they spend their income, we are prone to thinking that the increase of college tuition prices is unjustified. There is a common misconception that universities dont allocate their resources effectively, which results in an increased cost of tuition. The problem with this kind of thinking is that we dont know how universities function and how their funds are allocated. Instead of judging from the outside, we should try and better understand what causes the price increase. When thinking about the cost of tuition, something to consider is that prices are affected by competition between institutions, the distribution of wealth among potential college students and the ability of an institution to attract large proportions of its students from economic groups that can afford to pay the cost of higher education are important factors on deciding the tuition

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prices (Stoke, 1937). This means that the price that a student pays for tuition is affected by different factors such as: the competition between the universities, the wealth demographics among potential students and the demand for attending the college. As they are the first group to be affected from even a minor price increase of higher education, students and their families should be highly educated about how universities function and how they allocate their funds. Its the students main responsibility to know how much he is going to be spending while attending college, so he and his family can decide what can be done to make college affordable. Although it would be hard to prove and research due to deadlines for this paper, I believe higher tuition would have a negative impact on the economy because it will affect the percentage of population who consider attending college. Young Americans will look into alternatives like jobs involving labor. This will prevent our nation from moving forward in terms of technological advancement in the modern age. An advanced nation relies on bright minded individuals and their ideas to advance. Not having a highly educated and professional set of engineers and entrepreneurs can potentially set back a countrys development. Method Due to few data available that show how knowledgeable student are about the increasing cost of tuition, I decided to conduct a survey with students at Oakland University Campus in Rochester Hills. The survey would gather data that would show whether the students were aware of the ongoing increase of tuition cost or not. The target group included students that had already attended college for at least one year. The students were asked three short questions and were reassured their answers were anonymous. The surveys questions are designed to see if the

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student noticed an increased price of tuition and if they did, do they think this is justified or no. Knowing what students think about the increased price of pursuing higher education, and understanding if they thought the increase was necessary is important because it shows if the students are educated about this topic or no. Results The interview study that I conducted showed that six out of ten students had noticed an increase in prices of college tuition cost and all six of them thought that the increase was not justified. The truth is that the cost of tuition has seen an ongoing increase and in 2006 alone, the tuition cost for attending college in the state of Michigan increased by 7.9%. This increase was necessary even though the state of Michigan boosted funding to universities by 3% (WalshSarnecki, 2006). But is this increase unjustified? As the general public, since we cant really see where all the money from the tuition goes, we dont believe the rise of school tuition is necessary. What we dont seem to think of is that universities cant compromise the quality of their students education, hence resulting in an increased cost of attending college. Personally I think that there is no room for misusage of funds, which could factor in increasing tuition prices. When analyzing the cost of tuition, there are different factors that come into play. According to the laws of supply and demand, where there is demand, there is a higher price and vice-versa. Robert Bokelman (1960) suggested that across the country, there is still much extra unused instructional space. The problem is to convince the students to go where spaces are available. This shows us how students decide to go to universities where the majority of their friends go, instead of looking for an affordable and reputable college.

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The somewhat positive outlook on this issue is that students are aware. The first step to solving a problem is realizing it is there. Outside of the campus, the general public seems to be a little more concerned about this problem, as there are countless researches that describe the trend of the ongoing increase of higher education cost. As Ken and Daria Dolan (1995) state, the average price of a college education rose 6% in 1994, more than double the overall inflation rate of 2.9%. That followed an 8% jump the year before. Specifically here at Oakland University, in 2009 alone, undergraduates have seen 6.29% increases in tuition prices based levels set by its Board of Trustees (Lori Higgins, 2010). Discussion The broke college student stereotype has become a reality in our nation. The fact that many students have to take on one or two jobs to get by in the real world has a devastating effect on their learning. Although the young age group is usually the first one thought about, it must also be taken into consideration that older adults trying to get back into school have it equally or even harder to overcome. This is because they usually have families to provide for and it is obviously difficult if you have young kids to take care of. Fitting this, work and school makes getting an education a difficult task. This is something I can see for myself every day and I think the fact that it has become a normalcy is the problem. But what can students and their families do to deal with this ongoing increase of tuition cost? Change has to come from the people with the power to make change happen, and although I do not expect a full improvement, small steps forward make a very big difference. Knowledge truly is power, and taking action is the key to using the power to your advantage. Students and their families should firstly recognize the cost of tuition as something

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that might stop them from being able to pursuit higher education. After familiarizing themselves with this issue, they should take steps to tackle this problem. There are countless ways that will help them make higher education more affordable. The major steps that can help make higher education more affordable are: the possibility of receiving financial aid, low-interest loans, saving higher percentages of income towards college fund, etc. All these steps combined with healthy spending habits from the student can result in a hassle-free college experience. In order for both the student and the students family to be able to afford the cost of tuition, they should start saving a higher percentage of their income to help pay the higher education cost. Another solution is attending a less expensive university without compromising the quality of education. All these steps should be paired with healthy spending habits from the student, to help him stay debt free even after graduating college. Linda Stern (2009) offers quite a few good tips for the students considering higher education and their families. First thing to do is apply for financial aid early as the award is likely to be better. If the financial aid is not enough, a loan might be the perfect solution for many families. Stafford loans are the main form of federally funded aid now, and if the expected family contribution is below the school's estimated costs, students might be able to qualify for as much as $3,500 of subsidized loans for freshman year at 5.6% interest. If all these steps dont help, students should consider saving their summer earnings, or work on- or off- campus while they are in school. One thing to be noted is that students and their families should try avoiding private loans as their interests start at about 8 percent and can run as high as 17 or 18 percent depending on the credit score of the family. Other options involve using a home-equity line of credit or gifts from Grandma (Stern, 2010).

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If the increasing cost of tuition wasnt enough, students should also be careful with their personal expenses if they want to attend and be able to pay for college. From my personal experience, I would suggest students to skip eating out once in a while as these expenses can creep up without even being noticed. Another thing to consider is finding a reputable and affordable college. Just like the colleges dont want to compromise the quality of students they register, students shouldnt compromise the quality of the education they receive either, hence the best choice is going with a reputable college within affordability. Even though this isnt necessary, I would also suggest students to find a college that is close to home, so they wont be spending money on room and boarding if not necessary.

DEALING WITH INCREASING TUITION COST

References Bokelman, R. (1960). Tuition and costs. The Review of Economics and Statistics Journal, 42, 73-74. doi:10.2307/1926143

Dolan, K., & Dolan, D. (1995). The surest way to afford tomorrow's college costs is to start investing today. Money, 24, 41. Retrieved from http://search.ebscohost.com.huaryu.kl.oakland.edu/login.aspx?direct=true&db=bsh&AN =9506042767&site=ehost-live

Higgins, L. (2010, July 1). Oakland to raise tuition 6.29%. McClatchy - Tribune Business News. Retrieved from http://search.proquest.com.huaryu.kl.oakland.edu/docview/461092995?accountid=12924

Stern, L. (2009, August 17). How to afford college now. Newsweek. Retrieved from http:// www.newsweek.com/

Stoke, M. Stuart. (1937). What price tuition. The Journal of Higher Education, 8, 297-303. Retrieved from http://www.jstor.org/stable/1974031?origin=JSTOR-pdf

Walsh-Sarnecki, P. (2006, July 25). Oakland University raises tuition: 7.97% increase awaits students in fall. McClatchy - Tribune Business News. Retrieved from http://search.proquest.com.huaryu.kl.oakland.edu/docview/463454944?accountid=12924