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Home College

Tuition discounts at private nonprofits continue to climb, estimates show

by TheAdviserMagazine
3 months ago
in College
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Tuition discounts at private nonprofits continue to climb, estimates show
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The tuition discount rate at private nonprofit colleges for first-time, full-time undergraduates reached an average of 56.3% in the 2024-25 academic year, according to preliminary data from the National Association of College and University Business Officers. 

“This means that for every dollar of undergraduate tuition and fees that these institutions could have charged, they awarded roughly 56 cents in grant aid to first-time undergraduates,” NACUBO said in an announcement. 

The estimated tuition discounting rate for first-time students — which would be a record high — is up from 54.4% in the 2023-24 academic year. However, the data for the current academic year is preliminary and will likely change when the official tuition discounting rate is published in 2026, NACUBO said in the annual report. 

The rate has steadily risen over the past decade, increasing from 48% for first-time students in the 2015-16 academic year. 

The share of first-time students who received institutional aid has also steadily ticked up, from 87.2% in the 2015-16 academic year to an estimated 89.8% in the current academic year. Students are also receiving larger aid packages on average, the report noted. 

The tuition discounting rate for all undergraduates is estimated to reach 51.4% this academic year. That’s up from 43% in the 2015-16 academic year. 

In recent years, more than half of institutional aid has been funded through undedicated sources, according to NACUBO’s report. That includes foregone tuition revenue, general funds and unplanned donations. 

The next largest source has come from institutional reserves, followed by endowment earnings and planned gifts and fundraising activities. 

The report noted that “tuition discounting strategies come at a significant cost for many colleges and universities,” as higher rates can mean less revenue for operations. 

“Ideally, gross tuition and fee dollars should rise faster than grant aid, so that new revenue covers the cost of the discounts,” the report stated. 

Yet net tuition revenue is expected to decline in the current academic year by 0.8%. Last year, it rose 4.8% after accounting for inflation, and it has risen in all but three years over the past decade. 

This year’s tuition discounting study is based on data from 286 private nonprofit colleges.



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