The 2022 NACUBO Tuition Discounting Study, released on Monday, found that the majority of private colleges and universities clear the 50% mark in their tuition discount rates.
The survey of 341 private nonprofit institutions found a 56.2% average institutional tuition discount rate in the 2022-23 academic year for first-time, full-time, first-year students and a 50.9% discount rate for all undergraduates — the highest rates recorded.
The study has been conducted annually since 1994 and collects data from NACUBO member and nonmembers institutions who opt to participate in the survey.
“Discounting tuition is a key way independent colleges and universities make education affordable for students — many of whom are paying significantly less than their school’s published prices,” said Ken Redd, senior director of research and policy analysis at NACUBO. “At the same time, leaders remain mindful of the impact institutional grant expenses may have on their school’s overall finances.”
Similarly, the majority of undergraduate students grant aid, which were on average the largest recorded awards yet, with 90.9% of first-time undergraduates surveyed receiving institutional grant aid and 82.9% of all undergraduates receiving grant aid. That aid covered 62.1% and 57.6% of published tuition and fees, respectively.
Although the data for 2022-23 are preliminary, NACUBO reported that in 2021-22, the majority of institutionally-funded grant aid (56.5%) came from undedicated sources of revenue, while 28.6% came from institutional reserves, and 10.4% came from endowment earnings and withdrawals. Another 4.6% came from gifts or fundraising efforts.
The data also showed a slight dip in enrollment trends between 2021-22 and 2022-23 with a decrease of 1% for first-time undergraduates and a 1.4% dip for all undergraduates. Looking further back at the data when comparing the 2013-14 study to the most recent report, enrollments saw a 10% rise for first-time undergraduates and a modest 2.2% increase for all undergraduates.
“Despite modest declines in enrollment, the data show that the participating institutions delivered on their commitment to college access,” the report states. “Specifically, the results suggest that many private, nonprofit colleges and universities made significant investments to make higher education more affordable. Campus administrators continue to find efficiencies and new ways to offer high-quality postsecondary education without growing tuition revenue.”
Another key finding of the report is that “selective/highly selective institutions” are less likely to rely on tuition discounting. According to NACUBO’s data, the median rate for first-time undergraduates in 2022-23 at institutions who admit the smallest percentages of applicants was 46.8%, a roughly 12% drop from the median institutional discount rate (58.7%) for schools overall.
Data for 2022-23 is preliminary and NACUBO said the results will likely change when tuition discounting rates are published next year. Per NACUBO, this is due to slight changes in institutions that participate in the study and due to institutions completing the survey in the fall before enrollment data is finalized in the spring.
Publication Date: 4/26/2023