It goes by in a blink.
One minute it’s ceramic handprints and skinned knees. In the next, college applications and mortar boards. Interspersed between the pomp and circumstance are pixels of nostalgia and a gnawing wonderment at the unrelenting alacrity of time.
Looking back, the memories are bittersweet on a journey that was both bumpy and joyful. But as she begins for the next, the challenge of the unknown and unknowables loom large.
Gaining acceptance to a quality institution has never been more difficult. Nowhere has the competition been sharper than among major public universities.
San Diego State is a case in point. Applications for the freshman class of 2010 numbered nearly 64,000 for approximately 4,000 open slots. According to admissions officials, this story has been repeated at public institutions across the nation.
It May Be a Good Bargain
In a time of continuing economic challenge, public institutions like San Diego State are viewed a good bargain. With finances already stretched for many families of college-bound students, applicants have been more focused on finding a quality education closer to home.
More than at anytime in the past 25 years, record numbers of students are also opting for two years of community college as a means to save money if they are unable to secure a spot in a public university closer to home. This has created an economic conundrum for community colleges that already have cut staff and courses from their catalogue. With the forced reductions due to falling tax revenues, what was once a certain two-year transition to a four-year college soon may stretch three years or longer.
As any applicant and his or her family will tell you, college tuitions and costs have never been higher. On average, tuitions at both public and private four-year institutions have climbed 15 percent since 2009. Since 2000, college costs have escalated nearly 41 percent across-the-board.
In years past, entering students could rely on scholarships and subsidies to defray the escalating cost of education. College endowments that supply these subsidies, however, have been hit with the double whammy. While the recession has eaten away at their portfolios, charitable giving has dropped to a 20-year low.
Sinking in Financial Quicksand
Even legendary endowments, like Harvard, have been hammered. Harvard suffered the largest decline in endowment funds of any major U.S. college last year, as the financial crisis crippled the sophisticated but risky investment models that in prior years have made it the biggest and often best performing endowment.
The total value of Harvard’s endowment fell nearly 30 percent in the fiscal year ended June 30, 2009, to $25.7 billion. Much of that decline is from investment losses – 27 percent; the fund’s balance also went down because the university needed to spend money on underfunded school programs.
The Yale University endowment, the nation’s second largest, dropped 28.6 percent, to $16.3 billion, while Stanford University’s fell 26.7 percent, to $12.6 billion. Based on a survey of 842 colleges and university conducted by the National Assn. of College and University Business Officers, the average drop for endowments across the country was 23 percent.
This has meant that students and their families have, increasingly, been compelled to carry a bigger financial burden. Even though the Congress and the Obama administration arguably have streamlined the process, credit still remains tight. Borrowing has never been more onerous. Moreover, given the uncertainty of the economic landscape, students have begun to look askance at shouldering a loan burden they may be unable to service.
Come September, I will have daughters attending major universities on both coasts. I count myself fortunate, but still view the future with a foreboding optimism.
As a parent, I couldn’t prouder of my daughter’s accomplishments. As a father, I accept that the notion of putting my children through college was never designed, nor should it ever be, an easy task. I’m just not sure that it’s supposed to this hard.
Congratulations, Maya. May your future be bright and your possibilities endless.
John Cohn is a senior partner in the Globe West Financial Group based in West Los Angeles. He may be contacted at www.globewestfinancial.com
