The cost of a college education at a four-year state school rose just 2.9% from 2012-13 to 2013-14 was 2.9%, the smallest one-year increase since 1975-76. After adjusting for inflation, the increase was 0.9%, the lowest inflation-adjusted increase since the 2000-2001 school year.
At private four-year colleges, meanwhile, the 3.8% increase in college costs in the 2012-2013 period, was slightly lower than the increases of recent years.
And, in the decade ended with the 2012-13 school year, the average annual increase in tuition and fees at private four-year colleges was 2.4% beyond inflation — lower than in either of the two preceding decades.
It would seem that the soaring cost of college has finally been starting to moderate.
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These statistics on the cost of college come from the College Board
, an association for 6,000 of the world's educational institutions. College Board’s annual Trends Reports is relied upon by financial planners and the press as the “gold standard” for measuring college inflation.
However, the statistics don't tell the full story. They actually mask a hidden price increase at U.S. colleges.
According to Bruce Neimeyer, of Global Search Associates, a consultant who helps the children of advisor clients with the college admissions process, colleges have begun boosting revenue by accepting fewer advanced placement credits from applications coming out of high school and toughening academic standards, which increases the number of students who need an extra semester or two—beyond fours years—to graduate.
Neimeyer, an Associate Vice-Chancellor for Special Programs at University of Illinois at Chicago who has worked as a manager in the financial aid and admissions departments of several colleges over the past 25 years, provided detailed analysis, including some of which was frightening, about the rising cost of college at our weekly A4A webinar
series, and he also focused on the importance of matching students with the right college programs.
Advisors serving the mass-affluent, who are hit hard by college costs, should listen to Neimeyer's presentation, but Neimeyer's approach is ideas are probably even more important to advisors who work with high-net-worth individuals (HNWIs) and ultra-HNWIs.
Neimeyer’s experience and knowledge make him an excellent collaboration partner for financial planners advising high-net-worth individuals (HNWIs) and ultra-HNWIs. These people often have children with serious issues because they must face the problems as well as the opportunities that comes with wealth. Plus, having successful parents puts pressure on the children to succeed and outdo or at least keep up with the accomplishments of parents. Point is, clients of advisors can afford Neimeyer’s college admission consulting services and are good candidates to benefit from them. Bringing in a consultant with PhD in Social and Comparative Analysis in Education to help your clients’ children find the right college program for their interests and career goals is a really great way to help clients.
This was not a topic I expected to attract a lot of attendees because it seems far afield. But the 4.4 star-rating (out of five) tells you that Neimeyer’s ideas resonate with advisors, and look at the comments received:
- I liked it.
- Good Topic
- Wish there were more specific tips on career options. Admissions best practices, more info on financial aid
- Good general info on challenges and approaches to educational planning
- The webinar clarified many issues surrounding the college application process as it exists today. It is obviously a much different system than existed when the baby boomers went to college. I was not aware of the gravity of the situation pertaining to college financial viability. Also, seeing the exact dollar outlays being faced by college students and their families in today's world is alarming and should be understood clearly by competent financial advisors. Thank you.
- Very insightful and beneficial. I have a 5 year old and college is something I think about frequently.
- I thought the speaker was well versed in his expertise. I wish he would have gone a little slower
- Disappointed. Not much substance.
- Would've like to heard more about how Global College Search can help and what exactely they do to help
- Very helpful to have this kind of allied colleague available.
- I thought it was very well done except that it felt too "salesy" towards the end.
- I like everything except for the slides, I prefer power point slides over the way Bruce did it
- Rather sobering statistics
- Outstanding. One of the better presentations.
- Andy, Thanks. This is helpful. The information has given me a lot to think about. I have 12 years to prepare. OMG
You can view all of A4A's weekly professional education videos for financial advisors and get CFP Board or IMCA continuing education credits for most sessions if you have paid A4A’s $60 annual membership fee.