Families have more tools to evaluate college cost, but transparency still lacking, experts say

Derek Williams has received hundreds of letters from colleges across the country. Now, the high school football quarterback, baseball player and National Honor Society student must select among them a dream school that is actually within reach of his family’s pocketbook.

The stakes are high. Four years of paying tuition, fees, room and board and other personal expenses leaves the average student with more than $26,000 in debt. And some studies say the recent economic downturn has left half of the people who earned bachelor’s degrees working jobs that do not require that education and little way to pay back those student loans.

“The thing that concerns you the most is that you make that right decision,” said Chris Williams, Derek’s father. “Ultimately, this affects your child’s future.”

Across Ohio, financial aid award letters are going out this month, and students have until May 1 to commit to a school. But each letter can contain different language, so comparing schools can be a challenge. And even though there are more tools than ever available to evaluate how much college will cost, transparency is still sometimes lacking, experts say.

“It can be a little overwhelming to families,” said Brent Shock, financial aid director at Miami University. “Often more than one school is being considered at a time. They’ve got a lot of information coming back to them.”

Families say they are “annoyed, frustrated and scared” about saving for college, and only about a third have a plan to pay those bills, according to a survey by Sallie Mae, a private lender.

“We have students who are dreading the decision date of May 1,” said Danya Berry, Dayton Early College Academy’s college liaison. “Because they have this dream school in their minds… however, financially it seems almost impossible.”

Estimating costs

The need for greater transparency about how much four years of college will really cost comes as the nation’s leaders are pushing more Americans to pursue higher education.

President Barack Obama has challenged the United States to lead the world again in college graduates by 2020 and has asked every citizen to commit to at least one year of classes or training. Ohio’s leaders are also beating the drum about the need for more adults in the state to get a college credential to help attract new companies that will offer good-paying jobs.

Under the Obama administration, many colleges have entered a voluntary “Know Before You Owe” campaign that offers students standardized financial aid shopping sheets so they can more easily compare colleges. Obama also introduced the “College Scorecard” to provide “clear, concise information on cost, graduation rate, loan default rate, amount borrowed, and employment for every degree-granting institution in the country.”

And as of October 2011, colleges and universities are required to post net-price calculators on their websites. The calculators estimate what families will owe for tuition, room and board, books and supplies and other expenses after grants and scholarships are subtracted. However, it is still difficult to get an apples-to-apples comparison, and the numbers apply only to students who will attend college full-time for the first time who will seek a degree and have filled out the Free Application for Federal Student Aid.

“I would take the numbers with a grain of salt,” said national financial aid expert Mark Kantrowitz, creator of finaid.org. “They are estimates, and they’re averages. They’re not sufficiently accurate to compare one college to another.”

Kantrowitz said he does not recommend using the calculators to eliminate a college from a student’s search but to consider schools that the student might otherwise not thought possible.

Miami University’s net-price calculator asks just nine basic questions. Ohio State University’s requires 10 to 15 minutes to complete, and requires among information that families have on hand their records of untaxed income, current bank statements and the student’s ACT and SAT scores. Wright State University’s requires students to estimate their own cost for fees, other expenses and grants.

The calculators are still little understood by families, said Doug Schantz, director of the Office of Student Accounts at Wittenberg University and creator of CheapScholar.org. Still, he said they are an important tool that families should use to estimate what they might pay a college compared to what the sticker price might be. Although more people have been using the calculators since they were made mandatory, 54 percent of students still make their college choice without taking financial aid into consideration, according to a study by College Board.

“We have colleges and universities out there that have sticker prices that can be jaw dropping,” he said. “What net price calculators do is help get the families down to what they might be paying.”

Chris Williams said he has seen some net-price calculators so far in the search for the right college for his son, who is a 16-year-old junior at Springfield High School.

“I thought that was a great tool to offer to students and parents to be able to do that and kind of calculate where you would fit in financially as far as out-of-pocket,” he said.

Local efforts

Dayton Early College Academy senior Kinnie Carpenter said she has been able to estimate that her out-of-pocket costs to study dentistry at Otterbein University will be $14,000 per year.

“I don’t have a lot of money, so that made me want to apply to a lot more scholarship,” the 17-year-old said. “I don’t have the means to pay for it by myself and neither does my parents.”

Kinnie’s mother, Paula Carpenter, said the cost is her No. 1 worry, but she thinks her daughter’s desire to enter a medical field will provide her a stable future.

“You always want your child to be more prosperous than you are. You always want more for your child than you have for yourself,” she said.

Carpenter said she always knew she wanted to go to college, but she did not know the steps to get there, until she received help from DECA. The high school requires its students to take college classes while earning their diploma, complete at least 100 hours of community service, do job shadowing and internships and write a paper reflecting on how they are ready for college, Carpenter said.

Edgewood High School senior Hannah Brown said her school’s college life skills classes have helped her through the college selection process. Brown, 17, is hoping to attend Wright State University or the University of Cincinnati to study nursing and enter the Air Force, she said. She is also considering the Air National Guard.

“It’s been crazy. I’ve changed what I wanted to do a lot,” Brown said. She said she is applying for scholarships now.

Greg Brown, Hannah’s father who teaches at Edgewood, said his focus is to help her find a college that meets her needs and career expectations. But the costs, he said, are scary. And what parents think they have to save may not be enough, “and then you’ve got to rely on financial aid, if you qualify. Or if you don’t, then it’s loans and you worry about sequestration and what they’re cutting,” he said, adding, “If I have to find a second job, I will.”

Springfield High School also provides programs to help students plan for college, including a “College 101,” which brings back recent graduates to talk to current students about what to expect in college. The school also uses the CampusReady assessment to gather information on students and offer them one-on-one advising about college.

Local colleges and universities are investing additional money in financial aid and taking steps to be more transparent about costs.

The University of Dayton has received national recognition for being among the first institutions to offer a new tuition guarantee that eliminates all fees, promises grants will grow dollar-for-dollar with any tuition increases and spells out the total cost of attending all four years. Together, the changes promise to show families the full cost of earning a UD degree with no worries of hidden charges or surprises.

The reaction from families has been positive, said Rob Durkle, UD’s dean of admissions.

“We thought this was a worthy cause to take on,” he said. “We need to be a leader in higher education to show others that this can be done and this is the right thing for parents.”

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