Colleges Are Raising Prices Faster on Their Lower-Income Than Their Higher-Income Students

"Even in high school, Miguel Agyei worried about how he’d pay for college. The son of parents who work at a hospital and for UPS, Agyei wanted to go to a school away from his home state of Illinois, but that was too expensive. He instead picked close-by Bradley University and worked during the summer to pay the costs his financial aid didn’t cover," The Hechinger Report writes

... "Colleges and universities depend on money coming in, said Justin Draeger, president of the National Association of Student Financial Aid Administrators, or NASFAA. That’s 'the bottom line and the real challenge.' Sophisticated enrollment management strategies, he said, 'are driving at one thing: staying afloat.'"

"'Trying to attract students from one socioeconomic category 'might decrease them [from] another,' Draeger said. 'It would be natural, then, that in this enrollment-constrained environment, the people bearing a disproportionate impact of that would be needy students.'"

"The maximum Pell Grant this year is $6,895 per student. That’s up 15 percent since the mid-1970s, when adjusted for inflation, a period during which the inflation-adjusted cost of four-year public colleges rose 157 percent, the Pell Institute and University of Pennsylvania report. Advocacy and professional organizations including NASFAA have called for the maximum Pell Grant amount to be doubled."

"'We’re largely just treading water,' NASFAA’s Draeger said. 'Meanwhile, costs keep going up. And when the Pell Grant fails to keep up with inflationary costs, that’s often going to be felt by the neediest students. It’s doubly unfortunate because for those students, price sensitivity doesn’t just impact their choice of where they’ll go to college, it impacts whether they’ll go to college.'"

NASFAA's "Notable Headlines" section highlights media coverage of financial aid to help members stay up to date with the latest news. Articles included under the notable headlines section are not written by NASFAA, but rather by external sources. Inclusion in Today's News does not imply endorsement of the material or guarantee the accuracy of information presented.


Publication Date: 3/27/2023

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