Fewer students are paying the full sticker price at private nonprofit colleges than ever before, with the average freshman getting half of his or her tuition and fees covered by the school, according to a new study released Monday by the National Association of College and University Business Officers.
The tuition discount rate -- which the study defines as "institutional grant dollars as a share of gross tuition and fee revenue" for all students -- reached an all-time high of 45 percent in 2012, according to NACUBO's Tuition Discounting Study, up from 39.9 percent in 2008 and 37.2 percent in 2000.
This growing average discount rate is an attempt to lure price-conscious students who would otherwise not consider a pricey private college, NACUBO found. The survey includes data from 383 private, nonprofit four-year colleges and universities.
The study also found the average first-year grant recipient in fall 2012 was covered for 53 percent of tuition and fees, up from 51.7 percent in 2011.
Most private colleges follow a high-cost, high-aid model, in which the tuition sticker price is relatively high, but most students receive some form of financial aid that brings down students' bills. Public colleges on the other hand, follow a low-cost, low-aid model, in which the sticker price is lower but there is less grant money available to students. Survey data shows prospective students can be scared off by a high sticker price and tend to dismiss those colleges without knowing net tuition cost.
Some private colleges that are rethinking the high-cost, high-aid model have opted to cut tuition in an attempt to lure price-savvy students. Though the number of colleges slashing tuition rates was relatively low, private colleges posted the lowest average tuition increase in four decades for the 2012-13 academic year.
NACUBO said in a release that net tuition revenue has "essentially been flat for the last 12 years, demonstrating that increased gross tuition revenue has been given back to students in the form of aid, rather than put back into the institution."