Breaking Down and Comparing the Costs of an Online versus On-Campus Education
Ed Vosganian, founder and CEO of College Funding 123, has over 20 years of experience advising clients about how to maximize their financial outlook. He brings his extensive experience in college financial planning to families across America who face the challenge of paying for college while preserving the savings they have worked so hard to accumulate.
Over the last two decades, the field of online learning has grown rapidly, creating an alternative path to college for many students. In addition to being flexible and convenient, online learning can also be more cost-efficient than a traditional college program. By examining some of the most common expenses associated with traditional and online programs, students can determine which type of program makes the most financial sense for them.
Cost is a big factor for students pursuing a higher education. A 2015 study reported that affordable tuition and fees were the most important decision-making factor, with almost half of students choosing the least expensive school. Tuition and fees for online classes can be considerably lower than those at traditional institutions. Since they can study from home, online students can also avoid the room and board costs associated with living on campus and the transportation costs they would pay to live off campus while attending traditional classes. Additionally, some online students can take advantage of in-state tuition costs for universities, even if they reside out of state.
Because costs vary from school to school, it is important to do a budget analysis, looking at all of the specific costs associated with earning a degree. Once prospective students are aware of all the costs and fees associated with an online program, they can decide whether distance learning is the best route. To illustrate, the image below breaks down the costs for on-campus and online students at Eastern Kentucky University. Prospective students should remember, however, that they will need to find housing and pay for food regardless of whether they study online or on campus, although online students typically have more budget-friendly options available to them.
|Cost per credit hour||$735 (out-of-state)||$400||$500-$830||$500-$625|
Is it cheaper to attend college online? Whether students attend college online or on campus, they need to be prepared to pay tuition and fees. Some fees are mandatory and others are optional, so students should examine the complete list of fees carefully. But the costs for tuition and fees are typically less for online programs because their operating expenses are not as high.
Just as with any course or program, online costs vary greatly depending on the school, student circumstances and program. Our search tool makes it easy for students to compare schools and programs.
There are not many personal expenses when attending an online university versus a traditional college campus. Usually, everything in an online university cost is included, and some colleges also include a laptop for the student to use as well.Ed Vosganian
Tuition costs vary among online institutions but generally cost less than traditional on-campus programs. Online schools often offer a variety of options for making tuition payments. At Walden University, for example, students can make monthly, interest-free tuition payments. For students attending college through an employer-sponsored program, DeVry University offers a direct billing option that delays the due date until the middle of the semester. Several online schools also provide a tiered tuition option in which the per-credit rate decreases if students enroll in more credit hours. At DeVry, for instance, students who take more than six credit hours per term pay a lower cost per credit. This financial incentive is meant to encourage students to graduate quicker instead of taking classes one at a time.
Most online courses include a technology fee, either on a per-credit hour or per-term basis. The fee covers costs such as technology improvements, 24/7 tech support and online learning management systems. Some schools offer a tiered rate for technology fees. At Penn State, for example, students taking more credits save money on technology fees over the long term:
Many online colleges charge additional fees, such as for official transcripts or graduation. Students should also check whether there is travel involved for an internship or other program requirement, which they will be responsible for paying. Other charges that may arise include fees for:
In addition to mandated tuition and fees, it is important to consider personal expenses that students incur. For example, students will need a reliable, high-speed Internet connection. On the other hand, students shouldn’t have to worry about parking fees, fuel costs and on-the-go meals.
This refers to the amount a student pays to register and attend classes on a per-credit basis. Thus, the total will vary based on not only the academic program but also the number of hours a student takes. Typically, out-of-state students pay more for tuition than in-state residents at public universities, but this is not the case at private colleges.
Colleges usually include fees as part of the total tuition. Because the fees are wrapped up in the tuition, students may not realize that traditional campus programs often charge more fees than online programs. Fees can include:
Room and board covers the cost of housing plus meal plans for students who live on campus. Although off-campus students pay for housing (rent) and meals separately from tuition, it is important for all students to budget for these expenses.
According to the College Board, the average four-year student at a public university spends about $1,100 a semester on books and other course materials, which comes to about $8,800 for a bachelor’s degree program.
Students should consider nonacademic costs such as laundry, cell phone bills and takeout food as personal expenses.
Some colleges include the cost of a local bus pass in tuition. For example, CollegePass is an annual college-sponsored pass that allows users unlimited bus and light rail rides for a nominal cost included in tuition. However, if the cost is not included, students need to determine how they will travel to and from campus and at what cost.
The cost of attending college varies depending on whether students attend in person or online. Therefore, a good way to determine whether one route is cheaper than the other is to look at the figures side-by-side. The below illustrates the estimated annual costs for an actual school in Florida that offers both on-campus and online programs.
|Undergraduate On-Campus||Undergraduate Online|
|Tuition and fees||$28,588*Includes fees such as $52.62 per credit hour||$16,580*Includes fees such as $52.62 per credit hour|
|Books and supplies||$1,200||$1,200|
*$5.25 financial aid fee, $5.25 technology fee, $6.76 capital improvement fee, $35.36 non-Florida resident financial aid fee per credit hour
Overall, students can save a considerable amount of money by attending college online. In the above example, it works out to over $21,000, or half of the total expenses.
Students are responsible for many of the same costs whether attending college on campus or online. For instance, books and supplies, clothing and personal expenses are equal. The three costs that are the most different are tuition and fees, housing and food.
Tuition and fees tend to be higher at brick-and-mortar schools.
Traditional campus programs also require students to pay for housing, whereas online students can save money living at home.
Students who live on campus have to pay for food up front with a meal plan. Off-campus students have the opportunity to save money by cooking cheaper meals.
Students pursuing an online degree have many financial aid options available to them — as long as the online college is accredited. Accreditation means the college or university meets specific quality standards as determined by an accrediting agency. Financial options include:
Students should fill out the Federal Application for Student Aid (FAFSA®) to determine how much federal aid they qualify for, including grants and loans (Perkins loans, federal direct loans, direct subsidized/unsubsidized loans and Parent PLUS loans). Individual states also administer loan programs.
Companies, nonprofits and other organizations currently award $7.4 billion in college scholarships annually. Because criteria and requirements vary, students should investigate as many scholarship opportunities as possible.
Colleges and universities — both brick-and-mortar and online — offer aid to students based on a range of criteria. Students have access to work-study opportunities, grants and scholarships through various institutions.
For in-depth information, go to Financial Aid for Online Colleges, which details what types of financial aid are out there and how to apply for funding. Our College Resource Center can also help with finding additional scholarships and financial info.
Schools that offer both [online and on-campus programs] are more likely to be cost-efficient because of the endowment money available. There is a lot of money that is actually available for students, yet people do not know about all the possibilities out there. Taking time to research and get to know a school, their programs and scholarship money that is available is very important to start doing early on. I recommend beginning this process of looking for ways to be cost-efficient and researching scholarship options once the student is a junior in high school.Ed Vosganian
In addition to the flexibility associated with an online program, it can often be the cheapest option for students pursuing a degree. Although prospective students should determine their income and expenses to properly evaluate which path — online or traditional — is right for them, an online college may be the best option for many students.