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New Report Shows Effects of Grant Aid on Undergraduates’ Price of Attendance

August 8, 2012

On average, grant aid in academic year 2010-11 lowered students' price to attend public and private nonprofit colleges and universities by roughly 40 percent, according to a new report from the National Center for Education Statistics. Grants had a much smaller effect on students who attended proprietary institutions.

The NCES report, Employees in Postsecondary Institutions, Fall 2011 and Student Financial Aid, Academic Year 2010-11, measures undergraduates' "net price" of attendance by institution type and family income level. The "net price" is the difference between the listed total price of attendance (tuition and fees, room and board, books and supplies, and other education-related expenses) and grant aid received from all sources (federal, state, institutional, and private grants and scholarships).

The net price data come from the Student Financial Aid component of the Integrated Postsecondary Education Data System (IPEDS) annual survey. The data are based on full-time, first-time, degree- or certificate-seeking undergraduates at public, private non-profit, and private for-profit (proprietary) schools. Each institution's net is posted on NCES's College Navigator.

Overall, on average grants from all sources lowered the price of attendance for students at four-year public colleges and universities from the "listed" price of $17,563 to a net price of $10,971, a 38 percent "discount". At private non-profit colleges and universities, grants lowered the price of attendance by 42 percent (from $33,969 to $19,770); at community colleges, grants lowered students' charges from $11,396 to $6,763 (42 percent).

Grants appear to have much less of an effect at proprietary institutions. On average, grants to students at four-year private for-profit institutions lowered the price by 19 percent, from $27,854 to $22,537. At two-year proprietary institutions, grants lowered the price of attendance by 21 percent, from $24,485 to $19,339.

Variances by Income Level

The NCES report also measures the net price by students' family income level among undergraduates who received federally funded financial aid—particularly Federal Pell Grants. Because most Pell Grants are awarded to students from lower-income families, the effects of grant aid were more pronounced for students from with family incomes below $30,000.

At public four-year colleges and universities, for instance, the average net price for students from families with annual incomes below $30,000 was $8,286, while from families with incomes of $110,001 or higher had an average net price of $15,871. At private non-profit institutions, low-income students' average net price was $15,798, compared with $23,473 for those from the highest income families. The average net price for lower-income students at two-year proprietary institutions was $19,884, versus $24,102 for those from the highest income level. At four-year proprietary institutions, the average net price ($22,336) was fairly close to the price charged to undergraduates from the highest-income families ($26,956).

Copies of the net price report are available for no charge from the NCES Web site.


Ken Redd
Director, Research and Policy Analysis