You have to give credit where credit is due and I must say that the University of the South, found on a majestic wooded hilltop in Sewanee Tennessee, definitely should be given some recognition when it comes to adopting tuition pricing models.

In a time when most colleges are struggling to decide how small of a tuition increase they can impose on their students, Sewanee decides to take a different approach. They contemplate how much of a tuition DECREASE they can provide families and still maintain the same excellent level of services on their campus. That magic number for Sewanee this year was 10% (or $4600).

The current rate of tuition, room and board at Sewanee is $46,000 annually. So next year, the new rate will be $41,400 when factoring in the reduction. The silver lining to this story is that Sewanee is still standing by all of their financial aid commitments to current students as well. I bring this up because I have witnessed dramatic tuition rate reductions at other schools in the past but at the same time they adjusted financial aid accordingly. So the net out-of-pocket expense for many families never really changed from one year to the next even though the sticker price went down.

The Future of Sewanee

Not many colleges take as bold of a step or “leap of faith” as Sewanee has decidedly done… and there is good reason. It is very difficult for any college to plan on a tuition decrease because this almost always insures a loss in net revenue for the school. However, the way to offset that experience is to bolster numbers (enrollment). Based upon the coverage that Sewanee has received on their landmark tuition decrease announcement, I would say that they should probably be in store for a record year in regard to the size of their incoming class. If they are lucky, they may get enough steam off of this to secure their enrollment numbers for the next two years.

I would certainly encourage other colleges and universities to keep Sewanee in their sights for the next 3-5 years. If Sewanee’s “leap of faith” in tuition pricing pays off, it may serve as a good indicator for other schools that they can do the same. Inversely, it may prove that their decision may have been a little too “outside of the box”. Time will tell.

Here is a good promo video provided by University of the South (Sewanee):

You may remember that last year I wrote an article about how the Minneapolis College of Art and Design was implementing a tuition freeze for the first time in a number of years. President Jay Coogan stated that the tuition freeze would only be for a year and that a minimal increase was probable for the subsequent year.  Keeping true to his word, President Coogan just announced a tuition increase for the 2011-2012 academic year. One of our readers recently sent me a copy of the letter emailed to MCAD families this last week. You can read it in entirety below.

In response to the letter, I think that a 3% increase in tuition is pretty good given the double digit increases that we see popping up across the nation. I also like how they directly associated their increase to that of inflation for the past couple of years (1.5% each year).  Not many schools are quick to compare their tuition increases to the rate of inflation (probably because they exceed it every year). So, I give credit to Coogan and MCAD for their comparative analogy.

Request For Information
If you (or your student) go to a college or University that experienced a tuition increase (or decrease) that was historically significant, please don’t hesitate to pass the announcement letter or video onto me to share with our readers at CheapScholar.org. It could be great exposure for your college and it also helps to keep our readers in the loop of what is happening with tuition expenses in higher education.

MCAD Tuition Increase Letter

To all students:

I am writing to let you know that the Board of Trustees of the Minneapolis College of Art and Design has set tuition for 2011-12 academic year at $30,385; this is a 3% increase over the current year’s tuition of $29,500.

Over the past several years MCAD’s tuition increases have been among the lowest of art and design schools and private colleges in the country. Last year the Board took the unprecedented step of holding the tuition level from the previous year. When averaged out over two academic years, the 3% increase amounts to an annual increase of 1.5%; this is comparable with the nation’s overall rate of inflation.

In setting the amount for next year’s tuition we have kept two key objectives in mind:

1.     Keeping the increase as modest as possible so as to minimize the impact on MCAD students and families.

2.     Continuing to invest in the resources that help us maintain a high quality education. We believe this investment ensures the best possible programs and facilities to support our educational programs.

Members of the MCAD Board and I all understand the cost of attending a private art college creates a financial challenge for you and your families. Many of us faced similar challenges in attending college and all of us respect the sacrifices required. In order to help, MCAD is adding an additional $167,000 of institutional financial aid for the coming academic year.

Like all colleges, MCAD depends on fundraising to meet the financial needs of it students. The college has initiated the Students First Scholarship Challenge to provide currently enrolled students with additional financial aid. We are close to meeting this year’s goal of raising $100,000 from alumni, parents, and other donors in new and increased gifts—which will be matched by the Board for a total of $200,000 in increased scholarship funds. We hope to raise a similar amount of new funds this coming year.

MCAD is a place where creativity meets purpose. We are committed to spending your tuition dollars wisely in order to provide you with the best possible art and design education and help you achieve your goals as you transform your creative passions into meaningful careers and work in the world.

Sincerely,

Jay Coogan

President

The Board of Directors and Board of Regents for many colleges and universities will convene over the next quarter to establish the tuition rates for their respective institutions for the coming year. While we would all prefer to experience tuition freezes, or even better yet, tuition decreases, the fact of the matter is that the majority of schools will be increasing tuition and fees for the next academic year.

Princeton University is the first school that I have seen come forward and announce what the impact on tuition will be for their incoming and returning students next year. And I must say that I am pleasantly surprised.

Princeton is going to increase tuition and room charges by 1% and meal plans will receive a 2% bump. So, an undergraduate that plans to live on campus next year can expect to pay a total of $49,069. ($37,000 for tuition, $6596 for the dorm room,  and $5473 for the meal plan) This is just the sticker price because we all know that Princeton is one of the top financial aid schools in the country.

Provost Christopher Eisgruber shared the following statement: “In a year when Princeton had done relatively well and many families continued to struggle, we felt it appropriate to hold down the increase to the fee package to levels consistent with the very low inflation rates experienced by the university.”

So the question that comes to mind for new and returning students across the nation, is Princeton’s approach on a minimal tuition increase going to be the litmus test for how other schools move forward with their individual rate adjustments in the coming year? In a world of double digit tuition increases, I guess time will tell but I personally remain optimistic!

In the national news this last week, a young college man (Nic Ramos) attending the University of Colorado decided to pay his $14,000 tuition bill in cash (every parent and Bursar’s dream right?). The twist is that in an effort to bring to light the exorbitant cost associated with college, Mr. Ramos thought that he would pay his balance utilizing one dollar bills. You can check out the video coverage of this story below.

Nic’s story was an overnight rage as it flooded the Twitter and Facebook communities and it was only a matter of time before his event got picked up by national networks. I would say he was very successful in getting the message out about the rising cost of education. However,  that being said, I would like to offer the following reasons why you should NOT follow in his footsteps with paying your college tuition bill in cash (especially one dollar bills).

• IRS Form 8300 - Did you know that anytime you perform a cash transaction with an organization or business and the sum of the transaction exceeds $10,000, the organization is required to complete and submit Form 8300 to the Internal Revenue Service? My guess is that this could potentially set off some red flags for your next tax filing season.
• Did You Just Rob A Bank? - In the video coverage below, you will see that Mr. Ramos used a duffel bag to carry the cash to the Bursar’s office. This scenario of transporting cash reminds me of every bank heist movie created in the last three decades.
• Lets Talk About Safety – Nic was transporting this cash to and from various banks, probably throughout his dorm or college housing, and finally across campus to the Bursar’s office. Certainly not a good idea to do this with that much cash since someone could have easily stripped him of it at any moment.
• Time Wasted? - I am not as worried about Nic’s time associated with this venture since he actively chose to be part of the process. I am referring more to the bank tellers and the Bursar staff that had to count and proof all these one dollar bills by hand. A university representative said that it took three staff members at least an hour to count the money. If you take the Bursar staff time involved and double it to include the bank tellers’ time, that would put you at 6 hours involved with just counting money. Not sure of the hourly rate of these employees but you can see how quickly their time (and staff budget) would be gobbled up if more people started paying in this manner.
• Have You Ever Tried To Lug Around 33 Pounds Of Dead Weight? - This is how much 14,000 one dollar bills weigh (or roughly 424 dollars for every pound). It may not compete with a P90X workout but I am sure it ranks pretty close.

I certainly want to give Nic Ramos his props for passively taking a stance on rising tuition costs. His unique approach to paying his tuition bill certainly garnered some attention and got people talking (and that is always good). However, I can’t help but wonder, since we live in a society of one-upmanship, if there is a person out there right now that is collecting every last quarter, nickel, dime and penny in sight to pay their next tuition bill with only coins!

Can you imagine having to pay your college if you want to graduate with honors? I have never heard of this before. I am not sure if this a new fee or if it is just something that has not crossed my purview during the last decade and a half that I have spent as a college administrator.

Apparently 629 students that recently withdrew from the honors program at the University of Arizona don’t believe in paying this type of fee as well. The University imposed a $500 annual fee onto participating students this last year. Attendance in the program quickly went from 3,745 students down to 3,116 as students started dropping out left and right stating that the fee was the cause for their departure.

Kiki Wykstra is a senior at the college and she provided the following quote for the campus newspaper: “With the implementation of the fee, I didn’t want to pay money for something that wouldn’t benefit me and I haven’t seen any benefits so far,” Wykstra said. “Not that there aren’t (any benefits) but just for myself there wasn’t anything further that I wanted.”

In defense of the University of Arizona, they stated that the newly imposed $500 fee is going to help provide funding for special programs, presentations, and speakers for the honor students at a level that was not achievable prior to the fee.  They also shared that an Honor Fee is becoming more common and sited the following three institutions as having a similar fee: Barrett Honors program at Arizona State University – $1000 a year, Kitteridge Honors program at University of Colorado – $765 a year, and the University of South Carolina – $600 a year

In addition, the college has set up a scholarship program to help students that find the new fee financially burdensome and may have to cease being a part of the program due to inability to pay. Here is a copy of the application form to be considered for this scholarship.

If you are interested in learning more about the policy supporting the implementation of this fee, you can check out the “small print” here.

As for me, I am not a big fan of miscellaneous fees popping up on campuses across the nation. However, I understand the importance of them as they provide needed funding for critical programs and services that students enjoy. So.. the lesson for today… if finances are a driving force behind your college selection process, make sure you have a full understanding of all the fees that you may encounter at the school of your choice.

Health insurance is just one of those things that everyone should have. College students, of all people, should definitely have some sort of health insurance coverage to provide a financial cushion for any medical ailments that fall upon them during their time away at school. The question is, what are their options in regard to health care and what is the associated expense?

From what I can tell, college students have three options that they can choose from in order to get appropriate health care coverage:

1. Stay on Your Parent’s Plan: If your parent has medical coverage and it is beneficial from a cost and coverage standpoint, you should just stay on their plan. Starting this year qualified dependents are eligible to receive coverage under their parent’s plan until the age of 26. …just as an FYI.. this is not a green light for students to take 7 years to finish their undergraduate degree!
2. Enroll in the School’s Health Insurance: Colleges want all of the students on their campuses to have some sort of medical coverage. In order to achieve this, they have usually partnered up with an insurance provider to come up with an optional medical coverage plan just for students.  I refer to it as optional but most schools will charge you the fee upfront and enroll you in the plan unless you opt-out of the insurance, submit a waiver (electronic or paper), and show proof of alternate coverage. I have seen the annual fees vary on student health insurance from anywhere as low as $190 to as high as $1800.  A report from the U.S. Govt Accountability Office (GAO) states that $850 is about the average fee charged by colleges in the nation. If you decide to use the school’s program you just need to be mindful of the coverage and know if there are any limits that are imposed. The cost of these college health insurance programs are fairly cheap but as you can imagine, you get what you pay for, so the coverage may also have it’s short-comings.
3. Get an Individual Health Insurance Policy: Just about every medical insurance provider in the country has some sort of individual insurance plan that they provide to the public. Some of these programs are even geared (priced) for the typical college student. The GAO estimates that the average premium for this type of program is going to be approximately $1400 a year.  As you can see, it may be costlier than the college program but chances are the coverage will be better.

Based upon the information above, I would recommend the following student health insurance tips:

• Pick a Plan That Satisfies Your Medical Needs - If you are prone to needing medical care, a more comprehensive plan is the right choice for you. It may cost more up front but it will save you money over time.
• Your Parent’s Employer Sponsored Plan Should Probably Be Your First Choice - These plans will more than likely be the most comprehensive and the least expensive (when compared to similar options)
• Don’t Over Insure - If you stay on your parent’s plan, then make sure you opt-out of the college’s health insurance option. No sense in paying for something that you won’t use.
• Check Out Coverage Limits - If you have to go with the school’s insurance plan or sign up for an individual policy, make sure you are aware of any limitations to the coverage. It is not uncommon for these insurance companies to put a cap on how much they will spend on each illness or injury.
• Find Out How The Campus Health Center Operates - Most campus based health centers will only accept the insurance provided by the school. All other insurance claims would be your responsibility to submit to your insurance provider. This means you have to pay the fees up front and then seek reimbursement from your insurance company (you can imagine how daunting of a task this can be…).
• Consult Your Insurance Provider - In order to avoid the headache associated with the tip above, check with your insurance provider to find in-network doctors that are close in proximity to the school. They could prove to be a better option than the campus health center.

I hope our readers at CheapScholar.org find this information helpful.  As you can imagine, college expenses don’t stop with just tuition, room, and board. You have to make sure you are leveraging your options to limit your exposure to all fees associated with your college education.. that includes Student Health Insurance…