I had a chance to read an interesting article today about tuition cost comparisons between private and public schools. The conventional wisdom suggests that attending a private university would make a bigger dent in your finances than attending a public one. However, the author of the article suggested that the opposite maybe true. Reuters gathered student debt data from 25 private and public universities. They looked at the average student debt in those schools in 2011. They found that students at public universities often ended up owing more money at the end of their school years. For example, University of Michigan graduates owed on average more than $27,000, while the average for a Princeton graduate was only $5,000.
The lower debt burden can be explained by the fact that private universities have larger endowment funds and more generous financial aid policies. While tuition costs at private universities remained higher, at least half of students at those institutions (on average) graduated debt free.
Another interesting factoid is that some schools, such as Harvard, Berkeley and Stanford, capped tuition costs for “lower” and “middle-income” families. Starting in the Fall of 2012, Harvard is going to offer free tuition to students with a family income of $65,000 and lower ("low income"), and students with a family income under $150,000 (“middle-income”), will pay 10 percent of the total cost of tuition, room and board.
So don’t lose hope of going to Harvard or another Ivy League school, if you are an aspiring student. With free or nearly free tuition at some private, elite universities, you may end up owing less money than if you chose to attend an in-state public university! Now the challenge of being admitted to one of those institutions is all up to you!
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