Starting at a Community College May Not Save Students Money

By Catherine Groux
Posted January 29, 2013 10:00 AM

Transferring from a community college may not save students money.
Transferring from a community college may not save students money.

Many students begin their academic careers at a community college, hoping to take a few general education courses for a relatively low cost before transferring to a four-year university. This is widely believed to be a cheaper way to earn a bachelor's degree, as the cost of attending a community college can be drastically lower than that of a four-year university. According to the College Board, the published tuition at community colleges currently hovers around $3,131 per year. In comparison, private four-year universities now cost an average of $29,056 per year.

Based on this data, it seems logical that starting at a community college and transferring to a four-year school would save students money. However, according to a new report by nonprofit TG, this may not be true.

The TG report shows that regardless of whether students transferred from a community college or began their academic careers at four-year schools, they tended to graduate with the same amount of debt or, in some cases, even more debt. Both transfer and native students at public four-year universities graduate with about $20,000 in debt. Those who transferred to private four-year universities had $27,000 in debt, compared to $25,000 for native students at these private institutions.

"Many students have traditionally been guided to follow the transfer route, with the assumption it will help them save on certain college costs," said Carla Fletcher, TG senior research analyst and the report's author. "Unfortunately, we found this to be untrue, and in fact, the transfer route may end up creating significant barriers for some students."

One of the main reasons attending community college does not always help keep students' costs low is because both four-year public and private universities tend to give more financial aid to native students. At private schools in particular, native students receive an average of $4,000 more in institutional aid than transfer students.

Similarly, transfer students frequently receive less in grant aid than their peers, especially if they move to a private university. The report shows that, on average, individuals who transfer to four-year private schools receive $4,600 less in overall grant aid than native students.

Partially due to the fewer financial aid opportunities available to them, transfer students also borrow more money than their peers, which also contributes to how much debt they graduate with. According to the report, individuals who transfer to public schools borrow about $1,000 more than their native peers, while those who transfer to private universities borrow approximately $800 more.

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