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Where is our tuition money actually going? #JULY2020

I'm beginning to understand just how corrupt our post-secondary education systems are. That said, where is our tuition money really going beyond supplies and material for classes, and potentially the salaries of professors? How much of a chunk are deans and presidents taking out of our cheques to our schools? #college #july2020


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Dexter’s Answer

Hi Isabel,

I think it's good to take a systematic approach to this question and just go by the numbers instead of trying to place blame at large salaries. I mean, yes, high salaries of sports coaches and administrators are an issue, but that's not where all your tuition funds go. Instead, I would direct you to look at this article by Vox (https://www.vox.com/2014/9/14/6144919/where-your-tuition-money-goes-in-two-charts).

Another thing to look at would be to get to the bottom of why tuition is increasing so quickly. This article seems to do a decent job of explaining what's going on (https://www.cnbc.com/2019/12/13/cost-of-college-increased-by-more-than-25percent-in-the-last-10-years.html).

Lastly, I would also direct you to read this article (https://www.stanforddaily.com/2019/01/07/stanfords-finances-explained/) to explain how much money a college like Stanford brings in (6.5 billion a year). In Stanford's case, a staggering $4 billion of that goes to salaries and benefits for administration and faculty.

Anyways, this is a very complicated question, but I hope these resources help you get a bigger picture of the moving pieces in this story.

Wishing you the best!

--
Dexter

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Edward Obasi’s Answer

Hi Isabel,

I can only speak on the college system in the United States, and more specifically about my institution. A large part of your tuition usually goes to salaries for professors and staff, maintenance and upkeep of the college, etc. However, administrators and coaches take in pretty large salaries as well. In fact, in D1 schools coaches can take in a higher salary than the University President (both positions can make millions per year). A list of admin salaries can be found online in tax documents if you dig deep enough. I found a tax Form 990 for my school and was shocked at the salaries of administrators.

The answer is exactly correct. D1 schools coaches making obscene amounts of money get funding from boosters athletic revenue generated from ticket sales to the general public, student athletic fees, bowl games, tv, NCAA basketball tournaments etc. Very little money, if any, comes from the university itself. Basketball and football generally earn enough money to fuel the athletic department e.g. tennis and soccer. Tuition is high is because the federal and state governments (for state schools) do not provide as much money from tax dollars as it did in the late 70's. So, the cost of school is passed on to the students. The overwhelming majority of people who pay $200-500 for one football game will most likely scream bloody murder if the state asked for tax money forstate schools. Burel Ford

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Richard’s Answer

A large portion of a university's tuition money goes towards paying faculty. Because many professors teach only a few classes and spend the majority of their time doing research outside of their classes, it takes a lot of money to fund all of those professors.
Furthermore, there are a lot of college faculty outside of professors. The college has to pay to take care of its land and building to keep them all clean as well as paying for maintenance and construction on buildings. Then they have to pay for dorms and food for their students.

Beyond these obviously necessary things, universities are paying a lot of sports teams, stadiums, and coaches to make their university more attractive to top athletes.

The reason tuition prices are so high isn't just because of one or two things that take up a lot of money. Although the top administrators do make a heft salary, the tuition has increased because of the total sum of the various things they have to pay for.

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Estelle’s Answer

The cost of higher education can be very cumbersome, but please do not lose sight of the fact that it is an investment in your future. People with advance degrees have higher salaries, higher income generating potential, and more room for advancement. Don't get frustrated.

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