Tuition Increase Will Further Burden Students
UNIVERSITY PARK, Pa. – As of last year, American college students graduated with an average of more than $37,000 in student loan debt. Over 43 million students across the country use students loans to help pay for their education, totaling nearly $1.3 trillion.
The Federal Reserve statistics show that it takes most students at least 10 years to fully pay off their student loan debt. This decade-long span is just the standard payment plan for federal student loans, but in many cases, it takes even longer.
The average person will make just $50,556 in his or her first job out of college. Between paying for necessities such as housing, utilities, groceries, combined with student debt, and paying off these loans can be quite a burdensome process.
The more frightening news is that student debt is increasing every year. Also, the longer students take to pay off their debt, the more interest rates increase and the more difficult they become to settle.
Amber McKinney, an English teacher at Council Rock High School North, graduated from Penn State in 2007 and is still working to pay off her student loans.
“When I got out of college, planning to pay off my debt was not as much of a focus for me as it should have been. Now I am being more conscious about saving more money to go toward paying off my debt, and I am also paying a little extra each month as often as I can,” McKinney said. “I wish I would have done more to minimize the damage earlier in the process of paying it off.”
The average Penn State Class of 2016 graduate finished school with $37,112 in student loan debt, up 6 percent from the previous year, according to federalreserve.gov statistics.
This year Penn State made a 2.74 percent tuition increase from last school year, which increased the cost by $232 per semester. The annual tuition cost for in-state students is now $17,416, and when combined with housing, meal plans, and other mandatory student fees, the new annual cost of attendance is now $29,226 on average.
For non-Pennsylvania residents, it is even worse. Their tuition for the 2017-2018 school year increases to $33,213, resulting in an average $45,023 annual cost of attendance.
“Penn State is not your typical public state-school in that, legally, the university is separate from the state government,” Andy Weisner (PSU statistics professor) said. “While it receives some funding from the government, it has a lot of the freedom that a typical private university does.”
Pennsylvania is the only state in the country that uses this higher education public-private hybrid, which explains why Penn State tuition is higher than typical state schools. In fact, Penn State is the second-most expensive state-school in the country behind only the University of Pittsburgh, according to U.S. News data.
Some students were not even aware of this system when they first began applying to colleges.
“I assumed that Penn State and other Pennsylvania state-schools would be as affordable as any typical state-school around the country, but I was surprised to learn how much more expensive all of them are,” John Hogan (in-state student; sophomore-biology) said.
Even though it is still cheaper for a Pennsylvania resident to attend Penn State, many can agree that the new tuition increase further adds to the burden of paying for college.
“The hybrid system already makes things challenging enough, but the tuition increase forces me to spend less so I can help pay off as much tuition as I can,” Rachel Orr (in-state student; junior-kinesiology) said.
Orr added that she has had to particularly cut back on social spending, meaning using less money to eat out, attend concerts, or go to sports games on campus.
The newly enacted tuition increase is a result of several contributing factors, and it could increase slightly again within the next few years.
“Natural inflation will continue to slightly increase the cost over time,” said Brad Yeckley, a financial literacy advisor at Penn State. “Combine that with the facilities and academic resources the university wants to renovate, and they will need help paying for all of this somehow, which is where the increases start to come into play.”
A student from Massachusetts also spoke about how the tuition increase is more significant for non-Pennsylvania residents since it is based on a percentage increase.
“This means a larger increase to an already more expensive cost for students like me,” Tom Kaplan (sophomore-business) said. “Not only do I need to spend less, but I am also working in campus dining halls part-time this year to help pay for the higher costs.”
Similar to Orr, Kaplan also has been forced to spend less money in social situations, and he is working in the dining halls three times per week in four-hour shifts.
Some students are fortunate enough to be on partial-academic scholarships that help to ease the process, but these students make up only a small proportion of the student body.
“I am very thankful that I will not have a lot of debt when I graduate,” Megan Simms (junior-advertising/public relations), whose scholarship is worth $5,000 per year, said. “Just about all of my friends though, I don’t think will have that luxury, and it makes me feel bad.”
The tuition increase impacts those not only already attending Penn State, but also those who are currently considering attending the university in the future.
“Financially Penn State still makes a lot of sense compared to my other choices,” Morgan King (in-state high school student) said. “It definitely constricts my budget though, and maybe they will increase it again in the next couple of years before I graduate.”
King added that her family and she have extensively discussed a careful spending budget for her to follow at Penn State. She is also working as a camp counselor over the summer and will consider finding a part-time job at school to help her family pay the tuition.
The financial literacy department at Penn State and financial advisors in State College offer assistance for students to help make the process smoother. Even so, there is, unfortunately, no complete remedy to the student debt issue.
Richard McCabe, for example, has helped numerous students and their families with payment planning as part of his job at Loviscky & Associates.
“We help these families to make sure they have the right payment plan and that they are not borrowing more money than they have to,” McCabe said. “We make sure that they are paying on time and saving enough money to stay on schedule. Even though all of this helps them, it is obvious that this whole process does take a toll on some families.”
A college education is a major investment that may not seem worth it at times, but many of these financial experts contend that how the student handles the situation is critical to deciding whether it is or not.
“Some students find that the investment was not worth it, and a lot of times that is because they unfortunately either did not have an effective plan to pay their debt, or they did not make the most of the academic resources offered to them,” Yeckley said. “Usually though, the ones that have an intact plan and set themselves up well for their futures by performing well academically, have an easier time paying off student loans because they will get better jobs and be more financially secure in the long run.”
*all statistics used via federalreserve.gov*
Will Desautelle is a sophomore majoring in Broadcast Journalism and Political Science. To contact him, email email@example.com.