Throughout his presidency, Barack Obama has highlighted the accumulating debt Americans face, especially in regards to higher education. Last Tuesday at the State of the Union Address, President Obama officially announced the creation of the College Scorecard for the 2013-14 academic year.
1. Compare Costs At Schools
The College Scorecard is an interactive website that provides financial information for the purpose of comparing higher education. The concept behind the Scorecard is to assist college-bound students and their families. This tool will help families make appropriate financial decisions when determining their college decision. President Obama said in his State of the Union Address, “… my administration will release a new College Scorecard that parents and students can use to compare schools based on a simple criteria: where you can get the most bang for your educational buck.” The Department of Education and President Obama also want to hold colleges accountable for the rising debt crisis of the nation.
This interactive tool compares basic information regarding the college search in a easy to read format. The consumer can either begin by creating their own college search or by entering a school of their choice. The website provides five basic components: Cost, Graduation Rate, Loan Default Rate, Median Borrowing and Employment.
The Cost component refers to the average net price cost of attendance per academic year at a particular school. The Graduation Rate provides the percentage of full-time students that graduate within 6 years from that institution. Loan Default Rate makes available the percentage of borrowers that defaulted on their federal student loan within three years of repayment. Median Borrowing presents the amount a typical family borrows to attend the school and the monthly repayment amount of their federal student loan. Employment will publish information on earning potential of that particular college’s graduates. This portion is a work in progress as the Department of Education has yet to finalize the information that can be found here. All the information within the Scorecard will be updated periodically by the Department of Education.
3. Net Price Calculator
The Net Price Calculator (NPC) was mandated by the Department of Education to be placed on a college websites. Since October 2011, each college provides information on their website that allows potential students to see the actual cost of attendance.
Although this is a helpful tool for college-bound families, there are still criticisms of the NPC. One strong complaint been the placement of the NPC on a school’s website. Some colleges are transparent with the NPC. It is easy to manage, while providing an accurate estimate of the cost of attending that school. Other schools make it difficult on the consumer. Either the NPC is not easily found on the website, or it asks only a few general questions. The Department of Education has created a basic template all schools to use. Yet, most colleges have created their own specific version that provides an accurate estimate of potential financial aid.
4. Criticisms of Scorecard
The Scorecard is a convenient website that provides information at a consumer’s fingertips. Yet with a little research, much of this information could easily be obtained. For example, the Department of Education plans to publish information on earning potential later this year in the Scorecard’s Earning‘s section. This information is already provided on the internet by the Department of Labor.
The O*Net (onetonline.com) is a free online database created by the Department of Labor that can be used for career exploration, job analysis and earning potential. It explains the education needed to obtain a position in a particular field, along with a short and long term prospectus.
Other criticisms to the Scorecard are that it is a ‘one size fits all’ report that compares colleges based on their financials. Many critics feel that the cost of attendance overshadows other important elements of college, such as quality of education, student-to-faculty ratio and retention rates. Many colleges have been critical of the Scorecard. They state a college that graduates more students in traditionally higher paying professions, such as engineers and medical fields, will have higher evaluations. Those schools who graduate students into traditionally lower paying careers such as social services and education will be penalized with lower evaluations.
This newest government higher education mandate is another tool for college bound consumers to use at when comparing college. The Scorecard is a work in progress and a step in the right direction. It is not a game changer, but with the rising cost of higher education growing faster than the rate of inflation, it provides families with another useful tool to use when making an important financial decision.
Thomas Jaworski is the lead consultant of Quest College Consulting. He is an Independent College Counselor with over ten years experience in the college admission process as an Certified Illinois Teacher (Type 09) and Counselor (Type 73) while also a member of IECA and NACAC. For more information, you can visit his website at QuestCollegeConsulting.com or email him at tjaworski@QuestCollegeConsulting.com. Follow him on Twitter @Tom_QuestCC or on Facebook at Facebook.com/QuestCollegeConsulting