Understanding the cost of college — online vs. traditional

The average cost of attending an online college

For individuals returning to college after a hiatus or those with a full-time job or dependent children, attending an online college can be an ideal pathway toward higher education.

According to U.S. News & World Report, an online bachelor's degree from a public college during the 2019-20 academic year cost an average of $316 per credit hour, while an online bachelor's degree from a private college cost an average of $488 per credit hour. Furthermore, some colleges use alternative credit loads to appear cheaper. So, while they are $316 per credit, each class is 4 or 5 credits, making them more expensive. Meanwhile, the on-campus cost for the same degree from the same private college was $1,240 per credit — much pricier than an online degree.

That said, a survey by The Changing Landscape of Online Education found there is sometimes no change in tuition cost between on-campus and online degrees at the same institution.

Where the savings may come into play is outside of tuition costs.

Attending an online college may help save money in indirect ways. This can include lower (or non-existent) commuting costs, buying digital textbooks and spending less money on meals, parking, and day care or babysitters.

The average cost of attending a traditional college

The average cost of attending a traditional college depends on several factors. Attending an in-state college will typically be less expensive than an out-of-state college. Additionally, a two-year college will cost less than a four-year college. Attending a private institution is usually more costly than attending a public one.

According to College Board’s report "Trends in College Pricing and Student Aid," the following reflect the average tuition costs for the 2020-21 academic year (including fees, but excluding room and board) for full-time undergraduate students:

• Public two-year in-district: $3,770
• Public four-year in-state: $10,560
• Public four-year out-of-state: $27,020
• Private nonprofit four-year: $37,650

Those averages increase when room and board are included:

• Public two-year in-district: $12,850
• Public four-year in-state: $22,180
• Public four-year out-of-state: $38,640
• Private nonprofit four-year: $50,770

The bulk of most college students' educational expenses goes to tuition and fees. This means your choice of college will have the greatest impact on the final cost of your education. However, it's wise to consider other expenses as well. Expenses include the cost of books and supplies, transportation, clothing, personal items and entertainment.

For example, the average cost of books and supplies for public four-year in-state students at a traditional college is estimated to be $1,240 in 2020-21, a considerable sum that should be factored into your total budget.

Ways to save on traditional and online college

While these numbers provide a baseline for the average cost of attending a traditional college, they’re not the whole story. There are ways to save, in other words.

The most obvious of these is to choose a public, four-year, in-state institution that's close to your current place of residence (to avoid paying room and board). Or, if your degree of choice allows it, you may attend a two-year institution, otherwise known as a community college. You can also start your education at a community college to complete the mandatory general education classes, then transfer to a four-year institution.

Scholarships

Christine Conway, director of financial education initiatives at University of Phoenix (UOPX), suggests applying for scholarships to help reduce some of the costs of higher education.

“The best part is the money does not have to be paid back," Conway says. "There are many different scholarships available for students to apply for from colleges, community organizations, private companies and associations.”

Conway acknowledges that scholarship hunting can take time. But she adds, “When you think of it as hourly earnings, it can definitely be worth it. For example, if you spend 10 hours searching and applying. Receiving a $1,000 scholarship would be equal to $100 an hour!”

University of Phoenix is offering up to $1 million in scholarship opportunities this month. To learn more, visit our scholarship opportunities page.

Fixed tuition

Josephine Owens, director of enrollment at UOPX, says students often ask questions about “the benefit of our fixed tuition rate.”

A fixed tuition rate locks in your tuition cost for your entire program. This can make it easier to budget and helps you avoid costly surprises. Owens adds, “Education costs have risen an average of 2.6% every year in the U.S. overall.” This means a fixed tuition rate could help you save money in the long run.

University of Phoenix offers a Tuition Guarantee, so students pay one flat rate from enrollment to graduation from their program. If you’re interested in the University’s cost per credit or how tuition compares to competitors, visit the tuition and financial options page. However, not every school offers a fixed tuition rate, so make sure to check with your institution’s financial department.

Other savings

If you're employed and considering attending college, ask your employer about tuition reimbursement, which may cover “thousands per year,” says Conway. She suggests contacting your human resources department to verify if your company provides this benefit.

Another cost-reducing option is the Prior Learning Assessment (PLA) — the process where a university evaluates your relevant work or life experiences to determine what might qualify for college credit. Eligible experiences can include on-the-job training, industry certifications, standardized exams, military service or life-based skills. Unlike most universities, University of Phoenix does not charge for PLA. To learn more, visit our Prior Learning Assessment page.

Conway says of PLA, “You'll most likely need to provide documentation to demonstrate your experience and knowledge. But this can be time well spent since it could result in credits earned at no financial obligation.”

No matter how you choose to save, many options are available to support your dreams of attending college, both in-person and online.

All you need to do is pursue them.

Paying for school is an investment. If you’re unfamiliar with the financial aid options available to you and how to apply, check out your options on our blog.

Ready to take the next step? Learn how you can make time to go back to school as a busy parent.