If you are a college student (or about to become a college student) you probably already know that trying to figure out the best college to attend strictly based upon price is a very difficult task. There are a multitude of variables that come into play and inevitably you are never able to compare apples to apples when calculating the cost of one institution verses another. The Department of Education has recognized this issue and is implementing some legislation through the Higher Education Opportunity Act to help make things a little simpler (or so they say..)
Net Price Calculators For All
By October of 2011, all colleges and universities will need to have a Net Price Calculator established and available on their websites. They can use the free template provided by the Department of Education or they can create their own program as long as it includes the same perimeters provided by the Department of Education’s template. It is unclear which approach most institutions will be utilizing but they will need to have something in place by October of 2011 if they are to adhere to the legislation and maintain their access to Title IV funding (Federal Financial Aid).
These online calculators will use preset data provided by the school and inputted data supplied by the student to come up with a net figure that the student can expect to spend if they attend that college. As you can imagine, there is no perfect formula that can be applicable to all students, so you will need to take the figures with a grain of salt. Basically, the net cost calculator will compare your financial situation to that of similar students from the prior year and tell you the average amount spent by those students (Cost of Attendance minus Financial Aid).
What is really nice about these net cost calculators is that students will now have the opportunity to get past the sticker shock of the schools they are interested in and look at what comparable students attending that school are actually paying out-of-pocket after financial aid is factored in. This is sure to take a lot of the guesswork out of the financial aspect of your college search process. The only significant downside I can see to this program is that it is only as good as the data provided by the school (and I guess the student). So, if the school misrepresents (miscalculates?) something in the net price calculator tool or the student inadvertently provides the wrong information, the net price figure may be drastically off from what the end result actually turns out to be (the amount of the check from your checkbook).
The First College Ranking That Nobody Wants To Be On
Colleges and Universities love to be at the top of ranking lists. Some schools even actively make decisions on their campus based upon the outcome they think it will have on some of these rankings.
Well… the Department of Education is introducing it’s own ranking and it is called the “College Affordability and Transparency List” (CATL). This list will be published by July of 2011 and it is aimed at highlighting the schools that have the highest prices AND the highest rate of price increases. Schools at the top of this list for the three year period preceding the release of this list will be required to submit additional reports to the Secretary of Education (kind of like being summoned to the Principal’s office..never a good thing).
I am really unsure how the Department of Education will be calculating these figures but I can guarantee you that no college or university wants to be on this list and will do whatever possible to steer clear of being in the top ranking slots.
Ultimately, I think these changes in legislation are a good step to helping more students find the right college (academically and financially). However, I am cautiously optimistic on how this new legislation will mold the educational sector for the long-term. For example, if a college or school continues to be at the top of the CATL, will they eventually lose partial or full access to federal financial aid? I know that this would be of great detriment to the school but I think it would probably financially impact the students attending that school even more… I guess time will tell. For now though, lets enjoy these new legislative initiated tools that help us to make the college experience affordable.
