The Cost of Higher Education: A Guide to Assessing Value

Aug 18, 2011 by Dr. Donald Hecht

When considering your options for pursuing a college education, it would benefit you greatly to ask yourself (and find answers for) the following questions: What are my tuition and fees paying for? What am I receiving in return? Am I getting full value for my money? If I’m not using the sports facilities, or actively participating in campus life, social activities or intercollegiate athletics, must I still pay for them (and the myriad other costs associated with maintaining a university) as part of my tuition and fees? Is there a better and more economical way for me to earn my bachelor’s, master’s or doctoral degree?

The younger, undergraduate student body makes use of these facilities and activities that many adult students might consider to be frills. Yet the undergrad tuition charged by schools cannot cover the costs colleges must pay to provide these activities. As a grad student, I never took part in any of these on-campus and extra-curricular activities. I was too busy with a family, a job, and adult responsibilities. But did I get a tuition discount? Of course not! Was my tuition based on services I actually received? No!


Tuition for undergrad and grad students is fixed by economic necessity: to cover a school’s operating expenses. Usually, undergraduate tuition is lower than graduate tuition; in fact, graduate tuition is often 20 to 40 percent higher than undergrad. Why? Are there more services received in grad school? Are all the professors better qualified? Are the classrooms better furnished?

Unfortunately, the answer is again driven primarily by economics. Simply put, there are more undergraduate students available to pack into a classroom, so each class earns more sit-down tuition revenue. Since graduate-level courses are smaller on average, the cost per student must be proportionally higher to generate approximately the same income per professor or per class.

Is this good education policy or good business? I, for one, know that I would prefer to pay less tuition as a graduate student—tuition tied more closely to the services actually received. For example, if I am eating at a restaurant, I expect to pay for the cost of my meal (with a reasonable margin built in to allow the restaurant to make a profit), and not a bill based on the average cost of all meals served. Paying for those services received is certainly a better—and more fair—way.


Some online schools offer relief on high tuition costs since the campus-associated frills are not present. You get the educational services without the campus amenities (and their associated costs). Younger students (say, those 24 and younger) may prefer “camp college,” with all the extra activities that dominate their campus life and extend their studies so that it takes an average of five to six years to complete a four-year bachelor’s degree. Master’s degrees at brick-and-mortar schools usually take two to four; on-campus doctorates average seven to 10 years. More mature students tend to be interested in obtaining their education and degrees without these camp-like extras. And adult students, with families and jobs, want to save both time and money when seeking graduate degrees.

Many traditional on-campus colleges are now looking toward online education as a new revenue stream, one that allows them to make money without having students attend campus and occupy classroom seats. Many of these schools see online courses as a vehicle to save on campus-based expenses and services, yet they often charge a higher tuition for online courses. I can’t understand how they can justify the higher cost to students. (The most likely answer is that they don’t have to). Online schools should offer tuition savings since the educational services you receive are without campus-associated amenities—and costs. And I doubt there is a proportional increase in educational services associated with the online courses offered by traditional schools, since they often pack their online courses with hundreds of students, making them more cost effective, but diminishing student-faculty interaction and educational quality.

In considering how to best spend your education dollars, I suggest you look into online universities. Consider the cost of tuition and the savings you can receive in tuition, travel, and time. Plus, factor in the convenience of working from home, at your pace, and on your schedule. I—and many others—passionately believe that online colleges are the way to go in this 21st Internet century.

One further piece of advice: Be sure to find an online college or university with small course enrollment numbers, and one that’s accredited by an accrediting body recognized by the U.S. Department of Education, which will provide assurance that the institution offers quality instruction.

You’re a smart consumer when researching the purchase of automobiles, electronics, and virtually every other good and service you buy. So don’t forget to apply these principles when pursuing an undergraduate or graduate degree. Consider time, cost, and the quality and value of services received when evaluating your college options.

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