The Unforgiveable Tuition Hike

Al Jacobs

It appears there’s to be no peace at the 23 California State University (CSU) campuses, as the students decry a tuition hike. Amidst the chants of “No justice, no peace” and “The more we pay, the longer we stay,” protestors waved signs and shouted profanities. With a reported shortage of funds, the CSU Board of Trustees approved an annual tuition increase for resident undergraduate students.

What are the protests all about? The current yearly cost of $5,472 to attend the university, unchanged since 2011, is being raised by $270; the new fee will become $5,742. The increase is designed to bring in an additional $77.5 million in needed revenue to the school. Prior to the final vote the trustees adopted an amendment calling for the money to be allocated to classes and other student support programs.

For those of you unfamiliar with the costs of higher education, be aware obtaining a university degree may not come cheaply. You’ll find the following numbers instructive, if not intimidating. Current annual tuition to attend the University of California Berkeley is $13,510; if you also desire to live on campus, add another $14,992 room and board. If your home is just across the border, you may become a student at the University of Arizona for $11,400 plus $11,800 for living expenses.

Education becomes more expensive if you’re a Virginian, for their University’s tuition is $30,480. As formidable as these prices may seem, you’ll be even more out-of-pocket if you must attend a private university. The annual tuition at very respectable Rensselaer Polytechnic Institute in Troy, New York, will set you back $45,100. If you select Pepperdine University in Malibu, California, your tab comes to $48,090. And should you choose to earn your degree in residence at George Washington University, District of Columbia, you may expect to pay each year $51,950 in tuition, $12,500  room and board, $1,275 books and supplies and $2,550 other expenses. 

If it takes you four years to earn the coveted piece of sheepskin, you’ll have forked out $273,104 in cord hard cash. We might analyze how the numbers escalated as they did, but exactly why the skyrocketing costs at many institutions is a subject far beyond the scope of this article.

As you now possess a bit of perspective on the costs of schooling, we’ll return to the protests in process at CSU. After hours of debate, punctuated with testimonials from students claiming they spend their lives working long hours, are in need of financial support and on the brink of homelessness, the trustees approved the tuition increase. Whether or not you concur with the claims of many of the protesters maintaining the increases are unreasonable, there are a few facts you should know. The cost of higher education here in California embraces an enviable history.

Prior to the 1980s, the state-run systems operated essentially tuition free to verified residents. I specifically recall attending one of our community colleges and carrying a 15-unit course of studies. My cost: $6.50 per semester for a student health fee. Although conditions began to change thereafter, low cost schooling remained the established policy. As recently as the year 2000, annual tuition in the Cal State system was held below $1,500. By 2008 the total charge barely topped $3,000, and even with the most recent increase, it’s among the most reasonably priced university systems in the nation.

I’ll now offer my suggestions as to how persons with meager assets might best obtain their college education. The first two years, freshman and sophomore, will be spent at a community college. Here in California the charge is $46 per unit, so a student taking two full 15-unit courses of instruction during a two-semester academic year will require $1,380 for tuition. By living off campus – at home with parents if possible – and economizing on your required books as best you can, you can minimize your expenses. For your junior and senior years you’ll attend a CSU campus, again living off campus, where the $5,742 per year will be a necessity. Assuming you’re able to earn some money at a job during the summer months, and perhaps get a little financial assistance from whomever, you may be able to unceremoniously scrimp by – and mind you, there’s nothing wrong with unceremoniously scrimping by.

The method I’ve just outlined will cost $14,244 in tuition, plus books and fees. With any money you can earn or coax on the side, together with a heap of frugality, you should be able obtain your education – and a diploma to go with it – with no necessity to incur a student loan. And with this part of your life now behind you, and providing you’ve judiciously chosen your field of study, you’ll be off and running in your personal race to prosperity sweepstakes.

At this point, one particular matter must be considered. It relates to the sort of schooling I’ve just described. Although there’s general agreement a university education is a vital asset, there’s no consensus as to exactly what constitutes first rate schooling. If today’s institutions of higher learning share one thing in common, it’s the hyperbole each exhibits in promoting itself. Scholastic reputation, whether real or perceived, is a marketing tool, and there seems no limit to the claims of excellence used to induce students to attend, alumni to endow, and prestigious educators to affiliate. Above all else, higher education is big business in every sense of the word.

The message delivered is that unless a student attends a prestigious university, the education received will be second-rate. Lord knows, the academic community has been repeating this catechism for decades, and many persons believe it to be so. The result is as you might expect. Large numbers of students throughout the nation obtain their college diplomas from prestige institutions at a huge financial cost. Whether the funds are provided by parents, many who must literally mortgage their own existence, or by students who graduate with tens of thousands of dollars in student loan debt, the sacrifice is often immense.

Let me share my personal bias with you. The perceived reputation of an educational institution is mostly bunk. The source of the schooling is far less important than the student’s efforts, and neither the architectural characteristics of the campus and classrooms nor the credentials of its professors will determine the extent of learning acquired by a motivated student. As I’ve stated before, my mastery of algebra in no way suffered by my classroom being a primitively lighted and ventilated Quonset hut. Similarly my grasp of partnership law is sound, despite a one-time nameless and faceless course instructor located in a post office box two thousand miles away. Admittedly, a smiling and enthusiastic professor in an elite university adds a touch of stature to the process, but the eager student who strives to learn will do so regardless of the accouterments.

Unless you or your parents are rolling in more money than you know what to do with, attendance at an acclaimed university represents an unwarranted expense. The time will come when your textbooks have been sold, your course notes burned, the names of your instructors forgotten, and your framed diploma relegated to a rarely glanced at wall. At this point your education is what’s left in your head. That’s what really counts.

Al Jacobs, a professional investor for nearly a half-century, distributes a monthly newsletter in which he shares his financial knowledge and experience. You may view it on <> .




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